BU547 Lecture Notes - Lecture 9: Accounts Receivable, Trial Balance, Gross Margin
Document Summary
Involves selecting a sample of transactions if done manually. Reperformance or parallel simulation the redoing of procedures and internal controls (other than mathematical calculations) of the client by the auditor. This could include rechecking of transfers of information, which consists of tracing amounts to verify that when the same information is included in more than one place, it is recorded at the same amount each time. Reperformance is also referred to as parallel simulation. For example, if the auditor recreates the aged accounts receivable trial balance using client data, this is parallel simulation. This is a dual-purpose test since it ensures the mechanical accuracy of the aging process (a substantive test) while also verifying that the client"s aging program is functioning correctly (a controls test). lomoar cpsd| 5490467. Later, the auditor performs a walk-through and tests of controls to determine if the controls function as described.
