WorksheetsTOPIC 3 - AUDIT CASH AND BANK BALANCES
Total questions: 7
Worksheet time: 10mins
Purpose of Audit of cash balances is
Verifying whether the recorded cash in general ledger correctly reflects all cash transaction that took place during the year.
To enable the auditor to express an opinion whether the financial statements are prepared an all material respects, in accordance with an identified Financial reporting framework”.
Represents currency on hand, cash in bank including certificates of deposit, time or fixed deposits and saving accounts.
Types of Documents and Records
a copy of bank statement
Cash book
Standard letter to request information from financial institutions
Branch accounts
Audit Objectives for cash and bank balances are
Obtaining evidence to support the assertions contained in the financial statements, the auditor develops specifics audit objectives that relate to each management assertions.
Verifying whether the recorded cash in general ledger correctly reflects all cash transaction that took place during the year.
Explain the various types of management assertions and their relationship to specific audit objectives
Audit test for cash and bank balance are
Substantive test
Test of control
Analytical procedures
Test of detail of balances
Relates to the auditor’s examination of documentary evidence such as clients accounting records, ledgers and journals and corroborating evidence (payment vouchers, invoices and so on)
Above statement refer to audit procedures for
Inquiry
Physical inspections
Documents inspections
The flowchart above shows the
Control procedures to be taken by the auditor.
Internal control for cash and bank procedures.
Substantive procedure for recorded sales and cash.
Are an important type of procedures of an audit. Consists of evaluation of financial information made by as study of comparisons and relationships among both financial and non-financial data
This statement refers to
Inquiry
confirmation
Analytical procedures
Recalculation
