The control procedures that are made available are the tool that auditors have to evaluate the correct application of the audit programs that exist within the company.
Many of the problems that arise within the company due to the management of the available are caused by the poor implementation of the controls that are made on the most liquid assets, below are some of the procedures that must take into account the auditors to perform the evaluation of this item.
Control procedures for the available
1. Prepare summary sheets that break down the cash for each of its component concepts, reflecting the previous and current balances according to the records of the audited entity.
2. For a selected period, review the numerical and chronological sequence of the cash receipts, checking that it is complete and without amendment. Record any irregularities.
3. Obtain a list of all fixed funds, their respective managers and their location. Determine if there is any significant amount of cash to be deposited on the date of the settlement.
4. Selectively take daily cash movements and:
A. Check the operations that give rise to income and expenses, establishing the registry in the auxiliary; that the supporting documents are attached.
B. Verify the arithmetic operations and legal aspects of the originating documents;
C. Add the cash receipts and cross them against consignment and auxiliary vouchers. Determine that the cash has been collected in its entirety and in the state in which it was received.
5. Request confirmation of the bank accounts that had movement during the year, on the dates considered convenient.
6. Obtain the bank statements for the last month and the first month after the date being reviewed.
7. Selectively take movements and compare the items registered in the bank books against the consignment receipts.
A. Verify the reported consignments and cross them against the bank statements.
B. Check all consignments in transit or those registered by the bank and not by the entity.
C. Investigate conciliatory debit and credit notes.
8. Verify that all fund withdrawals are made by writing individual checks based on legalized vouchers.
9. When reviewing payments for bank commissions, interest, financial loans and services, verify that the payment authorization or debit note from the banks is in accordance with the operation.
10. For the analysis of payments for any concept, verify that the number of the current account of the check, name of the bank and net value drawn is recorded in the respective voucher.
11. Take note of the bank reconciliations (preferably obtaining a copy) prepared by the administration, verifying that they are prepared in accordance with accounting principles as follows:
A. Prepare a form indicating for each bank: Balance according to books, debit and credit reconciliation items, balance according to statement, arithmetic operations.
B. Select both debits and credits from the bank book and identify such movements against the bank account statement, or against the reconciliation.
C. Compare the balances against the major or auxiliary and against the statement.
D. Investigate all conciliatory items.
E. Verify that it is shown on the pending collection list: date, beneficiary, explanation and value.
F. Examine all debit and credit notes, checking that said charges or credits are correctly allocated to the respective accounts or are in the reconciliation (it is convenient to request a duplicate of the debit notes made by the bank to keep it as support).
G. Compare against the cash book those checks of any consideration that have been drawn with a later date.
H. Examine the payment dates of the checks selected in the test to ensure that they have not been drawn before the date and examine the pending ones.
I. Investigate all those checks previously deposited.
12. Verify that the collections received are deposited in full and on time, at least three days before and after the review date.
13. Investigate and review important check vouchers that have not been paid by the bank during the month following the review date.
14. Investigate all checks deposited prior to the reconciliation date that have been returned by the bank during the month following the same reconciliation.
15.Inquire about all extraordinary or abnormal transactions for a month before and after the review date. (It is recommended to carry out this work in accordance with the principle of materiality)
Fundamentals
All procedures should be based on generally accepted accounting principles, such as general auditing principles.
16. Make sure that all transactions that affect the accounts managed by the entity in foreign currency are authorized by the designated officials and comply with the administrative and legal provisions in this regard.
17. Confirm that the transactions in which these accounts are used are recorded based on the supports that justify the transaction in foreign currency, incorporating in a timely manner the exchange rate in force to date.
18. Circulate 100% of the balances of the bank accounts that are controlled in the treasury, both in national and foreign currency, obtaining confirmation of them on the closing date by verifying the transactions that originated them.
19. Ensure that the bank confirmations received include all the required information, proceeding to their verification.
20. It is recommended to verify that the confirmations come directly from the financial institution.
21. Selectively examine bank reconciliations in National currency. And in its entirety that of foreign currency.
22. Confront the adjustments to the current exchange rate for foreign currency accounts.
23. Practice checking funds and values in the presence of the cashier, maintaining control over the funds until this ends:
A. Request the account of the values by the person in charge and take note of their composition.
B. List the receipts issued and found in the box on the date of the settlement, verifying information such as: number, date, value, concept, etc.
C. Number and value of the last receipt consigned.
D. Establish by difference in numbering the last receipt consigned, issued, and those pending consignment with their value.
E. Obtain explanation of any normal items or differences or exceptions.
F. Leave a signed record of the confirmations of the test performed.
G. Demand the respective explanations if they are necessary from the person in charge, with respect to the materiality of the facts found.
24. Cross the result of the accounting with the book figures.
25. Check that all supports of the cash register are duly approved to date.
26. It is recommended to know the previous amounts of the limits to authorize the petty cash expenses.
27. Carry out minor cash accounting on the date deemed convenient using the general cash procedures and all those deemed necessary.
28. Based on the information obtained from the previous procedures, prepare the corresponding report.
29. Obtain the signature of the person in whose custody is the general box and the smaller boxes, acknowledging receipt of the cash, supporting documents and other items belonging to the fund.
30. Examine the original evidence of disbursements and rectify the general and minor cash vouchers with the cash renewal voucher, inspecting distributions and approvals.
31. Compare the cash reimbursement vouchers with the policy register, the expense book, cash expenses and other means. In case of differences, make the necessary adjustments with prior authorization.
32. Reconcile the lower cash balance with the higher on the balance sheet date.
