Page 33 - eBook Audit Of Financial Statement Components

Auditors also perform verification on the date of

presentation of cheques unpresented as at the end of
the reporting period, which is part of the test on bank

reconciliations.

TEST OF DETAILS OF BALANCES

Test of details of balances concern the obtaining of evidence for
Test of details of
accounts payable balances. The tests do not concern debit or
balances includes
the following credit of transactions but the balance at the end of the period.
three tests: Test of details of balances includes the following three tests:

iv. Review of monthly payable reconciliations
i. Review of
v. Confirmation of balances
monthly
payable vi. Investigating for unrecorded liabilities
reconciliation

i. Review of monthly payable reconciliations
ii. Confirmation A supplier's statement is documentary evidence.
of balances
However, since the document is obtained from the

iii. Investigating client, the authenticity of the document should be
for unrecorded
cautiously relied upon. Auditors should review the
liabilities
reconciliation prepared by the client and investigate any

unreconciled balances.

Auditors should be concerned about understatement of
account payables, thus the selection of accounts for

testing should be based on the volume of transactions

and not the list of account payables provided by the

client.

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