Question

What are the procedures in auditing cash? Which audit objective does each procedure relate to?

Answer 1

Audit of any functions is phased into

- Documentation

- Legal Complainces

- Authorisation Matrix

- Complaince with Accounting and Audit Standards

In order to conduct audit of Cash,

In documentatio: Records of receipt vouchers, payment vouchers, petty cash register need to be properly maintianed by the cashier. Daily balance to be updated and verified and reported to L2 officer as a policy startegy as chnaces of fraud may be decrease.

- Legal Complainces: Cash WIthdrawl , cash payment should not be more than limit as prescribed in IT laws, donation regulations, this things should be kept in mind, while conducting audit. As making payment above the cap may disallow such expenditure.

- Authorisation matrix: Every organsiation has policy and procedures for each and every process.

Same like in case of Cash, As very highly risky asset. where chances of embezzlement is very high.

- Maker Chacker should be in place

- Person giving the cash for deposit and person depositing the slip should be different

- Cash withdrawn from bank and updating in cash book should be different

- Reporting of Cash balance on daily basis should be updated to l2 officer. and sam eshould be reflected in ERP ledger balances.

Complaince with Accounting and Audit Standards: Cash balance as on Reporting date should be same as of apperaing in books of accounts. As same is required to be reported in the Financial Statement of the Company. Same should be autheticated by the CEO and CFO of the company so, same should be correct and appropriate as appearing in books of accounts.

No such cash transactions which is not to be expended in cash is reported properly in Audit report by the company.