This website uses cookies to ensure you have the best experience. Learn more

Revenue Cycle Audit Objectives Essay

507 words - 3 pages

REVENUE CYCLES AUDIT OBJECTIVES, CONTROLS, AND TEST OF CONTROLS
INPUT CONTROLS
1. Credit Authorization Procedures
* Only customer transactions that meet the organization’s credit standards are valid and should be processed further.
2. Testing Credit Procedures
* It pertains to the valuation/allocation audit objectives and the accuracy objective
3. Data Validation Controls
* Input validation controls are intended to detect transcription errors in transaction data before they are processed. Validation procedures are most effective when they are performed as close to the source of transaction as possible.
a. Missing Data Check – are used to examine the contents of a field for the presence of blank data or spaces (missing product numbers, missing customer accounts numbers, or incomplete mailing address)
b. Numeric-alphabetic ...view middle of the document...

d. The numbers of records in the batch (record count)
e. The total dollar value of a financial field (batch control total)
f. The total of a unique nonfinancial field (hash total)
PROCESS CONTROLS
1. File Update Controls – monitoring the batch as it moves from one programmed procedure (run) to another.
2. Sequence Check Control
* An out-of-sequence sales order record in a batch may prevent the remaining downstream records from being processed
3. Access Controls
* Prevent and detect unauthorized and illegal access to the firm’s assets. Inventories and cash are the physical assets of the revenue cycle.
OUTPUT CONTROLS
* Designed to ensure that information is not lost, misdirected, or corrupted and that system processes function as intended.
EXPENDITURES CYCLE
PURCHASES AND CASH DISBURSEMENT PROCEDURES
1. The revenue cycle or the conversion cycle initiates the purchase process.
2. When inventories are reduced by sales, the system determines if the affected items in the inventory subsidiary file have fallen to their reorder point.
3. Upon receipt of the purchase requisition, the purchasing department prepares a five part purchase order. (Vendors, accounts payable, receiving, data processing, and the purchasing department’s own file.
4. When the goods arrive from vendors, the receiving clerk prepares a receiving report. (purchasing, accounts payable, and data processing)
5. The data processing department runs a batch job that updates the inventory subsidiary file from the receiving reports and removes the “on order” flag from the inventory record.
6. When the accounts payable clerk receives the supplier’s invoice, he or she reconciles it with the supporting documents that were previously placed in the accounts payable pending file.
ADVANTAGES OF AUTOMATED SYSTEM
1. Improved Inventory Control
2. Better Cash Management
3. Time lag
4. Purchasing Bottleneck
5. Reduce Excessive Paper Documents
6. Segregation of Duties
7. Accounting Records and Access controls

Other Papers Like Revenue Cycle Audit Objectives

Evaluation Of Internal Control Environment Essay

8902 words - 36 pages CASE STUDY PA503 FUNDAMENTALS OF AUDITING Audit Firm Contact Number JABATAN PERDAGANGAN Programme Section CHAPTER 1 CHAPTER 2 Email Materiality and Audit Risk Corporate Governance PROBLEM SOLVING CLO2 | LD2/P3 Instruction: Please answer ALL questions. | Part 1 NEW CLIENT ACCEPTANCE DECISION Learning Objectives After completing and discussing this case, you should be able to: 1. Understand the types of

Case 5.3 The North Face Inc

609 words - 3 pages of trade credit. SFAS No. 48 was also violated by North Face Inc. North face falsely recorded sales of $9.3 million to inflate their revenues. These transactions were actually consignments and North Face did not receive money for the transactions. They allowed the wholesaler to return any unsold merchandise. Therefore the conditions were not met to allow North Face Inc. to recognize this transaction as revenue. 4. Audit work papers show

Audit Paper

1552 words - 7 pages companies state accounts receivable at the amount that will ultimately be collected” (Auditing pg. 530). During the audit we will use several objectives which will help us determine the accuracy and any misstatements in regards to balance-related accounts receivables. Also, we will review invoice confirmations, blank confirmation and positive confirmation. Based on our findings we feel that giving an unqualified opinion on this audit is

Testing

9695 words - 39 pages losing audit trail of information getting changed over the course of period. The benefit of establishing a new process to fix data in FDS/ODS is that we will maintain the integrity of the financial data allowing us to meet various regulatory requirements. This new process will save original records, reversal records, and correction records in the data store with sufficient detail and audit trail allowing UHG to recreate a snapshot of

Corporate Governance

1045 words - 5 pages the fraud case at WorldCom, WorldCom’s senior managers did not endorse this objective nor made any attempt to provide useful financial information to present and potential equity investors, lenders, and other creditors. Why? The senior managers subverted these objectives by focusing on revenue growth, seen as the key to increasing the company’s market value. Now although this focus is encouraged, WorldCom, as one manager says, “encouraged

A Report Of Environmental Cost On High-Speed Railway

1694 words - 7 pages , but these methods are extremely complex and require a lot of detailed information。It does not apply to the conceptual design phase; or just the simple sum of the cost of the product life cycle, so it can not correctly reflect environmental costs. Australia's S. Kara and S. Manmek, gave an integrated approach to estimate the external environmental costs, their comprehensive the SLCA (Simplified Life Cycle Assessment) model and EV (Economic

Case 1.6 Nextcard, Inc

1986 words - 8 pages understood the business they were auditing, their reporting methods and operations, having established preliminary objectives, researched possible problems or issues for this particular industry and become familiar with Comptroller policies and laws. If the audit team had researched previous audit records, contacted the Comptroller of the Currency (OCC), the integrity of Lent and his executives would have been in question. With research

Finiancials

1131 words - 5 pages auditor’s recommendation would have led to a downward revision of revenue which would have altered their growth perception they wished to portray. The internal audit committee and the board of directors, who have oversight of management practices, didn’t operate independently. The audit committee and the board of directors were controlled by the key families who had the controlling interest in ownership, though not outright majority owners. The

Au2 Assignment2

4505 words - 19 pages existing clients * According to CAS 300 the purpose of planning is to provide for effective conduct of the audit. * The auditor should understand factors such as major sources of revenue, key customers and suppliers, sources of financing, and information about related parties that may indicate areas of increased client business risk Question 4 (15 marks) Recently, you had lunch with some friends at a new restaurant in your

Warehouse Kpis By Segment (Sharing)

1027 words - 5 pages . 2. 3. 4. 5. 6. Shipping errors – order accuracy Order cuts – inventory accuracy Rail car cycle time – inventory availability Warehouse damage GMP audit rating On-time deliveries – customer service Monthly internal review – published / distributed Annual review with providers Monthly / annual award program KPI Scorecard Today Determining the correct KPI focus What is the right number of KPIs? No perfect number – 4

Tax Evasion In Bangladesh

5263 words - 22 pages various sectors. For this activities government needs founds and tax revenue is the main source for the purpose. But due to tax evasion and tax avoidance government’s revenue generation is not sufficient. So, it is very much important for us to stop tax evasion and avoidance for accelerating economic development. Objectives of Taxation: Taxation is the major source of revenue for the government. In order to accelerate economic development as

Related Essays

Smackey Essay

3065 words - 13 pages objectives. In this activity, the audit team assesses the risk of material misstatements arising from Smackey’s business risk. For example, the high wastage in Smackey’s Best Dog division presents a lot of business risk, and therefore material misstatement risk. 3. Perform preliminary analytical procedures. Keller CPAs needs to compare the performance of Smackey’s with the industry to further support its initial assessment of business risk

Adm 3349 Essay

2411 words - 10 pages you know it, but Brodie has also misplaced the audit plan for the acquisitions and payments cycle. He would like you to state each of the six specific transaction-related audit objectives for acquisitions and, for each objective, describe one common test of transactions. (12 marks) |Assertion |Transaction Related Audit Objective |Test of Control | |Occurence

Audit Essay

7817 words - 32 pages growth of performance audit work. 1.2 Objective of the study 1.2.1 General objective The general objective of this study is to evaluate whether the Ethiopian public sectors applying the performance auditing. 1.2.2 Specific objectives * To examining the application of performance audit in water and energy minister * To recommend appropriate solutions * The role of OFAG in Ethiopia performance auditing. 1.3

Jessica Essay

2307 words - 10 pages 304 sales tax 销售税,营业税 305 sales 销售,销货 306 sample size 样本量 307 sampling risk 抽样风险 308 sampling units 抽样单位 309 schedule of unadjusted errors 未调整的错误表 310 scope and objectives of internal audit 内部核数的范围和目标 311 segregation of duties 职责划分 312 service organization 服务组织 313 significant fluctuations or unexpected relationships 可重视的 (市价)波动或不能预料的亲属关系