- This topic has 7 replies, 2 voices, and was last updated 10 years ago by
.
- Posts
Hi,
Is it right when I write the sale cycle like this ( I can’t find in BBP book the sale cycle)1) sale department receives the order from customer and then prepare and sends the sequentially number sale order to credit control dep.
2) Credit control dep check a) credit reference for new customer and approve new acc with credit limit b) credit limit for existing customer to ensure that this order doesn’t make above credit limit
then approve the sale order and send to the
-shipping dep/ despatch dep
-accounting dep/
-invoice /billing dep3) shipping dep employer will go to the Warehouse and submit the Approved sale order and pull out the inventory, the perform the check of good received with the information in approved sale order, and the prepare a sequentially numbered despatch note and send to
– invoice dep
-accouting dep
-customerthen ship the good to receive the delivery note
-warehouse employer will record the good outward in a note ( and what is the name of this note? ) and update the inventory then send the note to the accounting dep’ for reconciliation purpose
4) Invoice dep’ compare , matching the sale order, despatch note and delivery note to produce invoice with check the quantity, total and authorised price.
send to customer and acc dep’5) acc dep’ match all the document and record invoice( dr receivable and cr sales) and delivery( Dr cost of sale and cr inventory)
That’s a pretty good system. Might be improved by physical control over despatches such as ensuring all goods leaving have a valid delivery note. Also,your system does not cover follow up of receivables (to ensure payment is received promptly) and the recording of receipts (Dr Cash, CD Receivable).
Statements would normally be regularly sent to customers and control account postings and reconciliations carried out.
Hi,again
Would you please explain for me why
Test of control(revenue cycle) for Segregation duties, authorization and credit check is classified at Occurrence and Existence assertion levelIn completeness assertion Control objective : All revenue relating to goods dispatched is recorded , control procedure : accounting for numerical sequence invoices, control test : review and test entity’s procedure for accouting for numerical invoice:
Would you explain for me the procedure for accounting for numerical invoice is what procedures?is it right when i said
to ensure the authorisation of credit term to customer i would OBSERVE the procedure of authorisation ,( only authorizing credit term to customer after checking the credit reference/credit limit) and sampling a number of customer order, INSPECTING the audit evidence for poper credit approval by looking at the signature of senior manager of credit control staff in approved credit limit file.In bbp book : the control test for authorisation is REVIEW the procedure for granting credit, EXAMINE a sample of sale order for poper credit approval
I’m so confused in using the verb here, why they use Review for procedure instead of Observe and in my opinion Inspect document include the meaning of Examine, Scrutinize ,Reading, Scaning, why the don’t use Inspect instead of Examine
Test of control(revenue cycle) for Segregation duties, authorization and credit check is classified at Occurrence and Existence assertion level :
>I don’t know why this is classified like that.
In completeness assertion Control objective : All revenue relating to goods dispatched is recorded , control procedure : accounting for numerical sequence invoices, control test : review and test entity’s procedure for accouting for numerical invoice:
Would you explain for me the procedure for accounting for numerical invoice is what procedures?>If sales invoices are a sequentially prenumbered pad of paper then completeness can be verified by ensuring there are no missing numbers in the sales day book and receivables ledger. Similarly if they are issued by a computer in sequence. The entity should have some way of ensuring that all invoices have been accounted for eg by ensuring their sequence is complete, such as reviewing the sales day book entries. Ideally, this control should be evidenced as having taken place, eg by a client’s staff member initiallying the bottom of each page in the sales day book to show that the sequence check has been performed. The auditor would also reperform some of these tests.
is it right when i said
to ensure the authorisation of credit term to customer i would OBSERVE the procedure of authorisation ,( only authorizing credit term to customer after checking the credit reference/credit limit) and sampling a number of customer order, INSPECTING the audit evidence for poper credit approval by looking at the signature of senior manager of credit control staff in approved credit limit file.> That’s fine though inspection is a stronger test than observation as behaviour can change when observation is taking place.
In bbp book : the control test for authorisation is REVIEW the procedure for granting credit, EXAMINE a sample of sale order for poper credit approval
> All they are saying is that first decide if a procedures is going to be effective in achieving a control. That is the review process. If that’s OK then it’s worth carrying out a test such as inspection/examine.
No one will worry whether you use inspect, examine or scrutinise
Hi, (^!^)
Would you please explain for me1)Rhapshopdy (6/7)
After the Oder detail is transferred to the Inventory control system, 2 packing list are printed in seed warehouse. The first one is sent to customer and second one is sent to accounting dep’.
Warehouse did’nt hold any copy
In book,
they said there should be 3 copies and one copy should be retained at ware house
If account misplace this copy there is no physical record of documentation sent to customer in case of dispute. This may lead to financial loss.In my opinion ,in case of dispute the warehouse can ask the accounting dep’ for copy and send to the customer, so why they need to retain a copy, they just need prepare a inventory summary and send to accounting dep’.
2) In “Planing attendance at inventory count”
In Plan procedure
they said : Ensure a representative selection of Location, Inventory and Procedures are covered.
so what is the meaning of the this sentence
Is it mean the auditor have to decide the which count at which location the auditor member have to observe for “representative selection of location+ inventory”
Decide the scope of audit testing to perform during the count base on professional judgement for ” procedures”1 “If accounts should misplace…” There would then be no /packing note/despatch note copy in the company. Better to keep an additional copy in the warehouse.
2 Correct. The auditor always decides on what to investigate and how to investigate it.
Hi,
English is not my 1st language so got problem in understanding this sentences, ( i can guess the meaning base on the context but not sure it’s 100% right)
“In light of the surrounding circumstances” , would you please explain the meaning for me?
- You must be logged in to reply to this topic.