You are an auditor on the Alpha Limited (Alpha) engagement. Alpha's accounts receivable master file includes the
Question:
You are an auditor on the Alpha Limited (Alpha) engagement. Alpha's accounts receivable master file includes the following fields:
1 Debtor account number
2 Debtor name
3 Debtor address
4 Credit limit
5 Total balance
6 Balance > 60 days overdue
7 Sales year-to-date total
(a) Alpha has integrated a programmed input application control (a limit check - refer to module ) on the credit limit field.
Describe a specific, practical audit procedure you would undertake to test whether this application control is operating effectively.
(b) Using generalised audit software, outline one exception report that could be produced from the Masterfile to assist with the audit of accuracy, valuation and allocation of accounts receivable.
Discuss how this report will be utilised in providing relevant evidence necessary to substantiate this assertion.
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill