Page 36 - eBook Audit Of Financial Statement Components

Purpose of auditing cash and bank balances auditing cash and

bank balances allows the auditor to ensure the following:

(a) Verify that the cash balance and deposits are accurate,

and

(b) Verify that cash disbursements are promptly recorded

in the proper amount.

Cash and Bank Balances
Audit Assertion Audit Procedures Cheques which

Occurrence Obtain a copy of the bank reconciliation statements have been
and check subsequent clearance of outstanding issued for more
items, noting dates of clearance
than 6 months

from the date of
Where items have been remained uncleared for a
long period of times, obtain details of payees, date of issue are
issue of cheques, uncredited amounts banked-in, deemed to have
dates banked-in etc
expired and are

no longer valid.
Rights/obligations Obtain direct confirmation from banks for balances
and credit facilities outstanding as at the date of Thus, such
period/year under review
payments

should be
Existence Obtain written confirmations for cash-in-hand and
petty cash-in-hand, where relevant investigated,
and

appropriate

actions should

be taken with
regards to such
payments.

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