Question

Wal-Mart Corporation is the largest retailer in the world, with sales in excess of $370 billion dollars in a recent year. Write the audit program for statistical sampling their Accounts Receivables or Accounts Payables. No data to provide, simply please describe the steps to be followed in the process.

Answer 1

Answer:

The most common audt procedure involving the accounts receivable balance is confirmation. To test that accounts receivale exist, the audtior will send letters to a sample of the client's customer asking to verify the amount that is owed to the company beng audited.

Audit procredure for account receivable are as folows:

• Trace receivable report to general ledger
• Calculate the receivable report total
• Investigate reconcile items
• Test invoices listed in receivable report
• Match invoices to shopping log
• Confirm account Receivable
• Review cash receipts.

To audit account payable you must match the ledger transactions to the figures in your geneal ledger. Cutoff tests check to whether transactions for the fiscal year are indeed including in your business end of year financial statement. Often an account payable audit can be the sole focus of an audit. Simply put an AP audit is an independant and systematic examination of an organization's account payable. It checks whether your transaction are properly recorded and whether those recording present an accurate view of your business.