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Saturday, 24 September 2011

How will you vouch the following, 1. Commission paid 2. Commission received 3. Payments to creditors 4. Bank account

It can be vouched by the auditor in the following way :

1. Checking Of Commission Book :-
Auditor can vouch the commission paid by checking the commission book. It will be initialed by those people who had received the amount.

2. Inspection Of Agreement :-
If the commission is paid according to percentage on sale then auditor will examine the agreement. It will explain the exact terms of calculation.

3. Calculation Of Commission :-
Auditor will check dial percentages is calculated on net sale after deducting the allowance bad debts and returns.

4. Checking Of Unusual Increase :-
Auditor will also examine that is there any unusual increase. If there is any increase then it is authorized or not.

It is vouched by the auditor keeping in view the following points :

1. Checking Of Account :-
Auditor should check the commission account with the account of parties from whom commission is received.

2. Inspection Of Agreement :-
Regarding the rate of commission auditor should examine the agreement with parties.

3. Checking Of Counter Foil Receipts :-
Auditor should verify the counter foils of the receipts with the cash book.

4. General Checking :-
Auditor should make all types of calculations to check the accuracy of the amount.

Auditor should check the following things while vouching the payments to the creditors :

1. Checking Of Invoice :-
All the invoices should be checked by the auditor.

2. Checking Of Receipts :-
Auditor should also verify the receipts given by the payee.

3. Checking Of Account Statements :-
All the accounts statements of creditors must be verified. He can send these statements to the creditor for confirmation with the permission of his client.

4. Checking Of Creditors Name :-
Auditor should also verify the names of the creditors.

5. Checking Of Account Posting :-
Auditor should check that posting to the relevant account is correct or not.

While vouching the bank account following steps should be taken by an auditor :

1. Comparison :-
Auditor should compare the bank statement with the cash book.

2. Checking Of Date And Other Particulars :-
Auditor should check the date of each entry and other particulars like figures for proper vouching.

3. Checking Of Credit Side Items :-
The items on the credit of cash book should appear on the debit side of the bank statement. It should be verified by the auditor.

4. Checking Of Statements :-
Auditor should examine the reconciliation statement and entries of a few weeks of the succeeding period.


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