Sales Transactions

Audit Audit Procedures

Objectives Test of Controls
Existence/Occurrence.
- The recorded revenue
pertained to the services
Examine the approved copy of
rendered to customers.
sales invoice/receipt for a sample
Recording of service
of entries in the service revenue
revenue transactions is
journal.
supported by customer
receipts.

Completeness.
- All revenue transactions
that occurred are recorded.
Observe procedure. Examine
Prenumbered sales
entries for a sequence of sales
(service) receipts are
(service) invoice/receipt in the
accounted for to determine
service revenue journal.
that all service transactions
are recorded.

Rights and Obligations.

- Revenues recorded
Observe procedure. Examine
represent only service
documents.
revenue transactions.

Valuation/Allocation.
- Service revenues are
correctly billed and
recorded.
The invoices/receipts are
checked for proper pricing.
Presentation/Disclosure.
Inquire about the updates and
use of approved price lists. For a
sample of invoices/receipts,
examine the signature pertaining
to the performance of task.

- The revenue account is

presented in accordance
with PRFS.
An independent review is
made of account journals
for recorded sales.
Observe procedure. For a sample
of invoices/receipts, recheck
account journals.
 Inventory and Purchase Transactions

Audit Audit Procedures

Objectives Test of Controls
Existence/Occurrence.
- All acquired items that have
been recorded as
acquisitions.
Examine the signature.
Purchase orders for
inventories are signed as an
Inspect and observe the
evidence of approval for
procedure and examine the file
acquisitions.
of documents.
Each acquisition must be
supported by purchase
Examine the cancelled
requisition, purchase order,
documents.
receiving report and
vendors invoice.
Documents are cancelled so
they cannot be reused.
Completeness.
- Acquisitions that occurred
are recorded.
Receiving reports are pre- Inspect the documents.
numbered and account for. Observe procedure.
Vouchers are also pre-
numbered and accounted
for.
Rights and Obligations. Observe procedure.
- Recorded acquisitions are
the entitys asset or
liabilities in case of
purchases.
 Receiving reports are
prepared by authorized
persons only. Inventories
are clearly identified.
Valuation/Allocation
- Acquisitions are recorded
for the proper amounts.
Amounts in the inventories
Examine the documents as well
are verified in reference to
as the signature.
purchase orders and
receiving reports and
amounts in the invoices are
rechecked.
Presentation and Disclosure.
- Acquisitions are recorded to
result in presentation and
disclosure in accordance
with PFRS.
All items that should be Examine signature of employee.
disclosed have been Recheck the documents.
completely disclosed.
Assigned person doing the
accounting report should be
different from the person
reviewing the files.

Cash Receipts Transactions

Audit Audit Procedures

Objectives
Existence/Occurrence.
- Recorded receipts
represent actual collections
of cash customers.
The assigned person in the
reconciliation is the one in
charge on prelisting of cash
receipts in the journal
entries and reconciling it to
the cash registrar, it should
Test of Controls
Observe whether a prelisting is
prepared and inquire of preparer
about the procedures.
Observe separation of duties and
inquire of personnel about their
responsibilities.
Examine the documents reported
to the Business Affairs Office and
 be different from the on
handling cash, the cashier.
There will be a
reconciliation on the from
SPA journal entries to the determine that the preparer
cash register and to the does not have conflicting duties.
Business Affairs Office who
is the responsibility of the
treasurer, at the end of the
month.
Completeness/Rights and
Obligations.
- All receipts are processed Observe monitoring and cash
and recorded. register operator about
Listing Cash receipts and procedures.
cash register are
monitored. Observe the procedure and
Cash receipts are deposited inquire personnel who perform
intact daily. the procedure.
The daily cash summary is
reconciled is prepared and For selected day, trace totals
reconciled to the total of from cash receipts journal to
pre listing and over the cash summary.
counter receipts and the
cash receipts.
Valuation and Measurement.
- Cash receipts are valued at
amounts received. Examine voucher for signature
Invoice/Receipt amounts indicating performance.
are verified.

Presentation and Disclosure. Examine the notes presented in

- A supervisor approves the financial statements.
account classification made Examine signature performing
in journalizing. check.
 Payroll Transactions

Audit Audit Procedures

Objectives Test of Controls
Existence/Occurrence.

- Personnel department
Examine approval signature on
authorizes additions of
pay rate (fixed rates).
employees to payroll and
approve changes in status
Procedure Observe separation of
and in pay rates
- Payroll disbursements are duties.
distributed by a person not
in the personnel.
Completeness.
- All payroll earned by the
employees is recorded.
Payroll disbursement are
pre-numbered and
accounted for in the cash
Observe procedures
disbursement journal.
Reconciliation shall be
made by the treasurer in
the Business Affairs Office
from payroll ledger to the
BAO's record.

Rights and obligations.

- Employees record their time
using a time clock but don't
record other employee
time. Examine signature on cards.
Supervisor approves time
cards before submitting to
payroll department.

Valuation/Allocation.
- Payroll transactions are
properly recorded for Examine signature indicating
proper amounts. verification on payroll.
Payroll calculations are
verified.
Presentation and Disclosure Examine the notes presented in
- Payroll transactions are
the financial statements.
recorded in accordance with
Examine signature performing
PFRS.
check.
Saint Paul University Philippines SPA and
Salon
May 2, 2016
AUDIT PROGRAM

Background:

SPUP is an international institution dedicated to

provide quality education and offers quality services at
affordable prices. One establishment found in SPUP is the
University SPA.

The University SPA is a non-profit organization but a

service-providing business. It was created primarily not
for the purpose of providing profit or gain but it was
intended for the medical students as their live-laboratory.

The SPA does not have accounts receivable control

since its operations requires cash payment just right after
rendering such service.

Auditors:
 Kristine Carla Santos
Alicia Ashley Viggayan

Elgiva Princess Leigh Umayam