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• What should auditor do when risk of fraud with regards to cash is increased? • What are...

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Accounting

•What should auditor do when risk of fraud with regards to cash isincreased?
• What are the aspects of control that auditors are mostconcerned about for sales and collection cycle?
• What are the significant factors about cutoff forsales/collection cycle?





Answer & Explanation Solved by verified expert
4.1 Ratings (490 Votes)
1 The following may be used by auditor to detect increasing fraud on cash activities Bank Reconciliation Tracking transfers to the bank statements Tracking the reconciled items in the subsequent period Trace interbank transfers by preparing Bank Transfer Schedule for detecting the possibility of kiting Trace cash receipts to bank deposit slips by tabulating the details of cash receipts documentation s and bank deposits for detecting skimminglapping Trace cash receipts from cash sales to sales register Make a surprise cash checks 2 1 Proper Segregation of duties Management should deny cash access to anyone responsible for entering sales and cash receipts transaction information into the computer The creditgranting function should be separated from the sales function because credit checks are intended to offset the natural tendency of sales personnel to optimise volume even at the expense of high bad debt writeoffs Personnel responsible for doing internal comparisons should be independent of those entering the original data 2 Proper Authorisation The auditor is concerned    See Answer
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