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Sir what is the difference between pre year-end sales and post year-end sales?
could you please give me simple explanation and examples with specific dates?
this is where pre and post year-end sales come from
Auditor response
Review a sample of the post year-end sales returns and confirm if they relate to pre year-end sales, that the revenue has been reversed and the inventory included in the year-end ledgers.
A pre year end sale happens before year end eg sale on 15/12/2017 when year end is 31/12/2017.
A post year end sale happens after year end eg a sale on 5/1/2018 when year end is 31/12/2017.
The auditor response you quote is there to check that the sale on, say 15/12/2017 wasn’t returned after the year end. If it was, the sale did not successfully occur and the revenue and receivables have to be reduced and the inventory increased.
If the sale on 5/1/2018 was returned on 8/1/2018 then that has no effect on the results for 31/12/2017 as everything happened after year-end.
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