Substantive Procedures , Analytical Procedures and Tests of controls

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November 4, 2011 at 7:50 pm #50345
cc123
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Hello could you please help me with the difference or definations of the three procedures. Substantive procedures, analytical and tests of controls.

Thanks.
November 7, 2011 at 5:29 pm #89360
Ken Garrett
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Tests of controls test controls. Eg has an order been authorised? Has a bank reconciliation been performed.

Substantive tests test financial statement figures directly. So, a receivables circularisation is a substantive test on the existence and ownership of receivables.

Substantive tests are of two types:

1 Tests of detail (look at lots of transactions etc, so circularise many customers))
2 Analytical procedures (ratios and comparisons). So, look at receivables days to get some evidence about receivables.
November 14, 2011 at 4:51 pm #89361
cc123
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Thank you. Much appreciated.
June 3, 2012 at 6:30 am #89362
Anonymous
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difference between substantive procedure and analytical procedure
June 3, 2012 at 6:58 am #89363
Ken Garrett
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Analytical procedures are one type of substantive tests. The other category is known as ‘tests of detail’ eg inspection, confirmation, reperformance etc
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