External Confirmation (3)

Question 1

External confirmation for receivables (1st step)

Answer 1

Obtain listing of trade receivables as at the confirmation date

Question 2

External confirmation for receivables (2nd step)

Answer 2

Agree total to nominal ledger

Question 3

External confirmation for receivables (3rd step)

Answer 3

Review for any obvious omissions/misstatements by comparing this year’s list with last year’s

Question 4

External confirmation for receivables (4th step)

Answer 4

Select a sample of accounts for confirmation. Agred receivables report may be used to make the selection

Question 5

External confirmation for receivables (5th step)

Answer 5

Send an additional confirmation request if no reply in a reasonable time

Question 6

External confirmation for receivables (6th step)

Answer 6

Follow up by phone/email/fax if still no reply

Question 7

External confirmation for receivables (7th step)

Answer 7

Where no reply is received obtain confirmation of individual outstanding invoices using alternative procedures

Question 8

External confirmation for receivables (8th step)

Answer 8

Further audit work is required where the confirmation response disagrees with the balance selected