Audit and Accounting > Sales and Receipts

The main concerns in sales are completeness of recorded transactions, correct pricing and the calculation of commissions. Credit checking may be important and, if significant, credit notes are worth checking.

Generally a sales history file should be available, although on some systems, transactions are archived or cleared down monthly. In these cases arrangements will have to be made to copy and save the file each month. The Append Databases feature of IDEA can then be used to create an annual file (or whatever period is required) from the monthly files. It is normally worthwhile conducting some analyses of sales by appropriate headings and then using exception testing.

The following are commonly used tests (grouped by type).

Analysis

  • Analyse sales and profitability by area, salesperson, month, store, category, vendor or all
  • Summarise receipts by type
  • Summarise cash receipts by the account code distribution for reconciliation to general ledger postings
  • Summarise shipments by warehouse for product distribution analyses
  • Produce analytical review information on sales by value band
  • Analyse product demand by summarising products by due date
  • Analyse open orders and open invoices by customer for credit control
  • Reconcile booked items to inventory reserved (on hold) items

Calculations

  • Reproduce sales summaries and posting totals
  • Test pricing and discount calculations on invoices
  • Control profits by calculating line item margins before shipment
  • Analyse variances in sales and summarise trends numerically or graphically
  • Report of correlation between items shipped and items ordered.
  • Isolate detail and average backlog by customer, item, location, etc.

Exception Tests

  • Sales value higher than usual for item type
  • Sales prices less than expected for product type or large discount given
  • Large credit notes
  • Identify high volume amounts by products, customers, sales representative, store, etc.
  • Extract all sales data for audit by customer, product, region, etc.

Gaps and Duplicates

  • Test for missing sales invoice numbers
  • Test for missing dispatch note numbers
  • Test for duplicate invoices (either duplicate invoice number, dispatch number or customer and detail/amount)

Matching and Comparing

  • Match cash receipts to receipts posted to the Accounts Receivable ledger. Identify unmatched records
  • Analyse sales trends by comparing current and previous periods
  • Analyse demand/trends by comparing current product sales with booked sales
  • Compare current product sales with booked sales for demand analysis/trends
  • Compare ratios of current sales to open receivables (high-low; low-high)