Prepayments - audit process, Auditing

Prepayments - Audit Process

Prepayments similar to accruals are not mostly checked through the double entry system. This creates them susceptible to mistake. The auditor's procedures involve:

1. That previous year's prepayments are written back.

2. Examining previous year's prepayments to obtain an appreciation of the kind of prepayments to expect the institute to have.

3. Comparison of previous year's listing along with the recent listing as prepayments do not change much from year to year, few items substantially greater or missing or less than last year's uses investigation. Obviously in the initial year of trading such a comparison is impossible.

4. Reliance on his knowledge of the accounts that frequently obtain prepayments such like rent, insurance, rates, advertising, etc. The auditor must examine that accounts to determine where prepayments have been understated.

5. Vouch the listing to maintain documentation of prepayments to establish the authenticity.

Posted Date: 1/28/2013 12:26:56 AM | Location : United States







Related Discussions:- Prepayments - audit process, Assignment Help, Ask Question on Prepayments - audit process, Get Answer, Expert's Help, Prepayments - audit process Discussions

Write discussion on Prepayments - audit process
Your posts are moderated
Related Questions
Auditor's Duties - Audit of Current Assets The auditor's duties can be summarized as follows: a) The accounting ascertaining policies adopted through the entity for pri

Building Societies - Specialized Audit Situation Building Societies are organisations that exist to offer a savings and investment intermediate to the public and to lend to pe

Standard Defines Development and Research The standard defines development and research as follows: (a) Research - planned and original investigation undertaken along with

Valuation and Petty-cash - Cash and Bank Balances Valuation Till recently, valuation of banks and cash balances was got for granted till several financial institutions st

Q. What are the different methods available for collection and analyzing audit data? Q. Describe and explain common audit findings in the fields of: a. Informed consent proce

Brand Names - Audit Process Few companies in current years have placed valuations on the brand names of the goods such they sell.  On the balance sheet the valuation is shown.

Auditor's Duty - Audit Process The auditor has a responsibility to express a thought on the truth and fairness and compliance along with legislation, of the accounts. The valu

Advantages and Disadvantages of Joint Audits The general disadvantages and advantages of joint audits as: Advantages 1. All fees and work are welcome to audit firms. 2. A


Q. Corporations generally issue stock dividends in order to a. increase the market price per share. b. exceed stockholders' dividend expectations. c. increase the marketability of