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A Kaplan Kit said auditors have a right to receive notice of general meetings. I don’t understand how this works. What kind of meetings?
Also, to test for cut off of revenue, are the below substantive procedure sensible and score marks?
1.Match the date in which sample sales order were generated to the payment invoice date and posting date on the accounting system and determine if the sales was recorded in the correct period.
2.For a sample of sales recorded immediately after year end, trace them to payment invoices or purchase orders generated after the year end as well.
Q1 A general meeting is where all the shareholders atend a meeting to vote on proposals/resolutions.
Q2 1 Normally the date of despatch determines cut-off, not the date of the order.
2 As above. Sales orders are not asmimportant as despatch for cut-off.
If an item is included in sales, it should not be included in closing inventory as it should be despatched. If not in sales, so not despatched, it should be in closing inventory.
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