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Ayush Kumar asked 1 year ago

For example we want to check all sales transactions and eliminate fake bills through sampling. As we are checking a particular assertion we would select a sample to apply Audit procedures. What are the examples Of TOC and TOD we can check? And from which data we compare the conclusion drawn from sample to find deviation and misstatement? 

1 Answers
RaviRavi Staff answered 1 year ago


Such transactions will be generally credit sales 
Whether credit sales are done to registered customers, who are evaluated first
Whether credit sales are authorised, see signature or stamps
Whether sales are booked after receiving signed delivery channel from customer  
Whether sales is booked only after having all documents such as customer order, sales agreement, transporter bill, gate pass etc
Match sales with all transactions as given above
Check subsequent collection
Check whether there are unusual sales return or balance write offs
we will project level of misstatement and compute level of deviation
tolerable misstatement will be based on materiality
tolerable rate of deviation will depend on how much reliance we want to put on controls, 96% confidence means 4% rate of deviation  

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