Question

Auditing the client's bank reconciliation is the primary substantive procedure for auditing cash. Identify at least 5 procedures the auditor performs in testing the bank reconciliation.

Answer 1

1. Internal auditor are important to any company to check whether a procedure, system, project or product sound. The same appappl to bank Reconciliation

2. In order to begin we need to copy of the bank reconcilation of the month we wish to audit a copy of the corresponding accounting records and a copy os the bank stastatem for the month in question.

3. The fundamental first step is begin with a triple check comparing the balance on three documents and conforming that it is correct.

4. If a reconcilation process has been deemed necessary we can assume that some difference between the balance give with the found and this means we will have to check that this difference is justified and under controle.

5. The next step is to review every transaction on the bank accoubt and check them against general accounting records to make this task easier a check mark can be placep against each item verified on the pronted copies of both documents.