Cash and window dressing - building society, Auditing

Cash and Window Dressing - Building Society

Cash

Possibility of misappropriation and error usually accompany the handling of cash. Building societies transactions towards a large extent are in cash. However this does not include audit considerations so that differ in principle from those encountered in any another business. Then there should be surprise cash counts and any discrepancies have to be investigated in detail.

Window Dressing

Auditors should examine transactions that have the effect of showing as on the balance sheet date a state of affairs mainly the society's liquidity such is materially better after it was while the year and shortly after. Of specific attention are:

1. Large deposits obtained shortly before the year finish and repaid shortly after;

2. Large mortgage repayments obtained shortly before the year finish and re-advanced on the same property shortly after;

3. Unusual delay until after the year finish in creating payments in accordance along with applications obtained for withdrawals of shares or deposits;

4. An abnormal year finish accumulation of commitments for advances followed through the creating of the advances shortly after the year finish;

5. The importance of items in the bank reconciliation statements.

Not just does the auditor report on the financial statements to the members, he is also supposed to provide a report to the registrar of societies to accompany the yearly return.

Posted Date: 1/28/2013 4:19:26 AM | Location : United States







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