Payables Flashcards
1
Q
What are the sources of evidence?
A
- Aged Payables Listing
- Purchase Invoices
- Goods Received Notes
- Post Year-End Bank Statements
- Supplier Statements
1
Q
What are the key assertions?
A
Completeness.
2
Q
What can you do with the aged payables listing?
A
- Obtain a list of trade payables, cast to verify arithmetical accuracy and agree to the general ledger and the financial statements - completeness, classification, presentation.
- Reconcile the total of the individual payables accounts with the control account - completeness.
- Compare the list of trade payables and accruals against the prior year list to identify any significant omissions - completeness.
3
Q
What can you do with supplier statements?
A
- Obtain supplier statements and reconcile these to the payables balances. Investigate any reconciling items - existence, completeness, obligations & valuation.
4
Q
What can you do with purchase invoices?
A
- Inspect invoices received after the year-end in respect of goods delivered before the year-end and trace through to the accruals listing - completeness.
5
Q
What are other things you can do?
A
- Enquire of management their process for identifying goods received but not invoiced and ensure that it is reasonable - completeness.
- Inspect the trade payables ledger for any debit balances, for any significant amounts discuss with management and consider reclassification as current assets - valuation of payables, completeness of receivables, classification.
6
Q
What can you do with goods received notes?
A
- Select a sample of goods received notes immediately before the year-end and follow through to inclusion in the year-end payables balances - completeness of payables & cut-off of purchases.
7
Q
What can you calculate?
A
- Calculate the trade payables payment period and compare to prior year, investigate any significant differences - completeness & valuation.
