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Saturday, 24 September 2011

How you will vouch the dividend paid

Dividend Paid :-
To vouch the amount of paid dividend following steps should be taken :

1. Payment According To Right :-
First of all the auditor should check that dividend is paid according the right given in the legal documents.

2. Interim Dividend :-
In case of interim dividend auditor should check the articles of association to find that the directors were empower to pay this dividend or not.

3. Justification Of Payments :-
The auditor should also check this point that whether the profit disclosed by the interim accounts justify `the payments.

4. Resolution Examination :-
In case of final dividend auditor should check the resolution passed by the shareholders in the general meeting.

5. Checking Of Amounts :-
Auditor should check the amounts in the dividend book and compare it with the bank account.

6. Checking Of Dividend Book :-
Auditor should see that the total in the dividend book represents the correct percentage given on the share capital or not.

7. Checking Of Paid Income Tax :-
Auditor should examine the amount of income tax deposited in bank. He should also check the rate of income tax and receipts of challan.

8. Checking Of Unpaid Dividend :-
Auditor should trace out the unpaid amount of dividend from the unpaid register.

9. Checking Of Costs :-
Auditor should check the cost, cross costs and carry forwards the dividend book.

10. Checking Of Dividend Book :-
Auditor should check die dividend book with returned endorsed dividend warrants.

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