Vouching of Credit Sales
In Sales Book, only credit sales of goods are
recorded. Auditor before vouching the sales book should check the effectiveness
of the system of internal check and control in operation.
The auditor should carry out vouching of credit
sales in the following manner:
1. The
auditor should verify the efficiency of the system of Internal check in
operation by test checking the transactions.
2. Auditor
should vouch Sales Book with the copy of the invoices, Orders Received Book and
Goods Outward Book and ensure that all sales made are accounted.
3. He should
check the casts, postings and carry forwards of the Sales Book.
4. He should
see whether there is any omission or inflation of sales.
5. Auditor
should ensure that sale of capital assets are not considered as ordinary sales
and accounted in Sales Book.
6. Trade
discounts allowed to customers should be checked and differences if any
observed should be enquired.
7.
Auditor should check that cancelled invoices are
properly cancelled and kept separately.
8.
To detect fraud, the auditor should prepare a
statement of accounts of the customers and send it to the customers to confirm
the accuracy of the balance.
9. Auditor
should carefully vouch the entries made in the sales book of the last few weeks
to ensure sales belonging to the next financial period are not treated as
current year’s sales or fictitious sales not being recorded in the books which
will inflate the profit.
Books and Documents to be Vouched: (1) Sales Invoice, (2) Sales
Book, (3) Customers ledger account, (4) Goods Outward Book.
On 5.2.2017, X Ltd. sold 20 shirts
for Rs.200 each to Ram & Co., Bangalore on credit.
Auditor should vouch the transaction
in the following manner:
1. Verify entry in Sales Day Book
with respect to date of sale, invoice number, name of customer and sale amount.
2. Verify entry in Debtors or
Customers Account with regard to date and amount of sale.
Related Topics
Privacy Policy, Terms and Conditions, DMCA Policy and Compliant
Copyright © 2018-2026 BrainKart.com; All Rights Reserved. Developed by Therithal info, Chennai.