COMM 455 Chapter Notes - Chapter 9: Financial Statement, Accounts Receivable, Audit Risk
Document Summary
Receivables do actually exist and are collectable, and adequate allowances have been made for receivables that are doubtful, in terms of their collectability. Sales are genuine and are neither overstated or understated. To obtain sufficient and appropriate evidence about each significant. Use a combination of toc and substantive procedures. assertion (txns & balance) 9. 2 the process for credit sales and transactions. Accepting customer - this involves receiving a sales order and checking it for authenticity (occurrence), acceptability of terms and conditions and the availability of inventory. Once accepted, the order is then recorded on a pre-numbered (completeness) multi-copy sales order (occurrence) which shows the description of the goods, quantity ordered and other relevant data. Approving credit - this should be completed before the order moves to the warehouse. To obtain credit, cu completes a credit application and a credit report. Approved by the credit manager, credit limit is set and cu is entered.
