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You have given me good advice regarding suitable TOCs for control recommendations. Thank you so much for this.
I have some questions regarding this,
1. If the control recommendation says to confirm from the customer that they have placed an order for goods via telephone, and if it was just a verbal confirmation, what can I as an auditor do?
2. If the recommendation says to check inventory, is the TOC that the auditor must attend company stocktake and physically count inventory?
3. What can the auditor do to test unfulfilled orders? How can he track the despatch down if its possible? Like, whether its in the warehouse etc…
And lastly, 4. How can the auditor check that discounts allowed are authorized? Does he inspect the department records that authorized it or does he speak to the manager?
And does the examiner accept all these answers?
Thank you once again
1 Might be recorded in case there are disputes. If so, listen to recordings. Otherwise look for despatches, invoices, signed delivery notes and cash receipts.
2 On full stockcounts, auditor attends, observes, and does some test counts but does not do the whole count.
3 The despatch should be made at some time even if after period end. That can be checked.
4 Generally, there should be written authorised records of agreed discounts so that the company and customers know what has been agreed.