Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › what is the difference between test of details and analytical procedure
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- June 8, 2012 at 4:34 pm #53234
what is the difference between test of details and analytical procedure
thx
June 8, 2012 at 6:07 pm #99754They are both substantive tests.
Analytical procedures consist of ratios, comparison to last year’s figure and budgets. The aim is to find items that look ‘odd’ or ‘wrong’. If everything looks reasonable then that is evidence that the FS do not contain a material misstatement.
Tests of detail include tracing figures from invoice to ledger, recalculating lots of wages, performing receivables circularisations. These tests give direct evidence that all’s well.
June 11, 2012 at 1:10 pm #99755can a question came of solving ratios as an analytical procedure and then describe the differences ?
June 11, 2012 at 2:45 pm #99756Yes indeed. You might have to calculate ratios and suggest reasons for changes. There have been such questions in the past.
June 11, 2012 at 6:41 pm #99757AnonymousInactive- Topics: 0
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Test of control is to test the effectiveness of an entity’s internal control system, ie payroll system.
Substantive tests are to the details of items on the P&L or BS at assertion level.June 12, 2012 at 11:35 am #99758No one has mentioned test of control on this thread. Why have you?
May 15, 2016 at 2:20 am #315112Is directional testing an example of test of detail?
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