No. 1.

Audit Procedure Review the acquisitions journal for large and unusual transactions. Send letters to several vendors, including a few for which the recorded accounts payable balance is zero, requesting them to inform us of their balance due from Fooley. Ask the controller to sign the letter. Examine a sample of receiving report numbers and determine whether each one has an initial indicating that it was recorded as an account payable. Select a sample of equipment listed on fixed asset master files and inspect the asset to determine that it exists and to determine its condition. Refoot the acquisitions journal for 1 month and trace all totals to the general ledger. Calculate the ratio of equipment repairs and maintenance to total equipment and compare with previous years. Obtain from the client a written statement that all mortgages payable have been included in the current period financial statements and have been accurately recorded and that the collateral for each is included in the footnotes. Select a sample of cancelled checks and trace each one to the cash disbursements journal, comparing the name, date, and amount. For 20 nontangible acquisitions, select a sample of line items from the acquisitions journal and trace each to related vendors invoices.Examine whether each transaction appears to be a legitimate expenditure for the client and that each was approved and recorded at the correct amount and date in the journal and charged to the correct account per the chart of accounts.

Type of Evidence Documentation

Type of Test

TRAO/BRAO Test of Transaction Test of Details of Balance

2.

Confirmation

3.

Documentation

Test of Control

4.

Physical Examination

Test of Balance

5.

Recalculation

Test of Transaction

6.

Analytical Procedures

Analytical Test

7.

Inquiries of the client

8.

Documentation

9.

Documentation

No. 10.

Audit Procedure Examine invoices and related shipping documents included in the clients unpaid invoice file at the audit report date to determine whether they were recorded in the appropriate accounting period and at the correct amounts. Recalculate the portion of insurance premiums on the clients prepaid insurance schedule that is applicable to future periods. When the check signers assistant writes paid on supporting documents, watch whether she does it after the documents are reviewed and the checks are signed.

Type of Evidence Documentation

Type of Test

TRAO/BRAO

11.

Recalculation

12.