audit

Inherent Risk:

Here you document your inherent risk level (low/medium/high) for this account, including a rationale for the assessment (based on the nature of the account)

Overall Risk of Material Misstatement:

Here you document your overall risk assessment level (low/medium/high) for the given account based on the items at the left.

Control Risk:

Here you document your control risk level (low/medium/high) for this account, including a rationale for the assessment (based on the client’s internal control over this account)

Internal Control Testwork

Procedure

Relevant Assertions

W/P reference

Done by and Date

1.

Obtain an understanding of the client’s internal controls over cash transactions and balances.

2.

Perform tests of design over selected controls (you would list out what you did – i.e. walkthoughs, etc)

3.

Perform tests of operating effectiveness over significant internal control procedures related to this account

Example: inspect monthly bank reconciliations for proper and timely preparation, mathematical accuracy, and review by appropriate personnel.

Substantive Procedures

Tests of Details

1.

Confirm significant cash accounts with financial institution.

EAOP

2.

Review the client’s bank reconciliations for significant cash accounts.

Vouch reconciling items to supporting documentation.

CEAP

3.

Review cash accounts for any compensating balances.

CEAOP

Analytical Procedures

4.

Compare current year and prior year cash balances. Document explanations for significant variances.

CEAP