Detailed List of Accounts Receivable

Topics: Accounts receivable, Invoice, Customer service Pages: 2 (384 words) Published: December 30, 2010

4. Scan the detailed list of trade accounts receivable and investigate significant unusual items (e.g., credit balances and zero balances).

Done by Date ..../../..


When scanning the detailed list of accounts receivable (aged by customer, if practicable), the auditor should be alert for high risk conditions and unusual trends that may indicate audit risks that require further attention; for example, unusually high or low sales activity in the current period (30 days or less), concentration of balances among a few customers, customers with known financial difficulties, the existence of related company balances or unusually high levels of long overdue accounts.

The auditor should also be aware of credit balances in the list because they may result from, among other things, unrecorded sales, erroneous entries to the accounts or, in some cases, special transactions or financing arrangements with customers. Scrutiny of customer accounts by the credit department and others reduces the risk of error associated with credit balances.

12. When confirmations are not sent, for selected accounts:

a. Compare subsequent remittances credited to the accounts with remittance advices or other receipts (e.g., deposit slips and bank statement) and ascertain that payments relate to the account balances.

b. Examine documentation such as shipping documents, copies of sales invoices, customer sales orders, and other relevant correspondence supporting the unpaid portion of the account balances. Coordinate this test with the review of the collectibility of overdue accounts (see step 17b)....
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