| | Step | Audit Procedures Description | Timing | What is being tested? | Who
Completed | Date
Completed | Who
Reviewed | Date
Reviewed |
| | 1 | obtain an understanding of the internal controls systems of Barnes & Noble through an intitiation of a transaction to establish the controls in place as well as the effectiveness of the controls in place. | Phase 1 | Determining the effectiveness
of the internal controls put in place by Barnes & Noble |
| | | Observation of the business processes in action and specifically the control elements of the process. In the audit of cash and cash equivalents, an auditor checks the internal control measures associated with the recording as well as balances in the compnay's accounts. |
| | | The auditor carries out an
inspection of the business documents of the company to ascertain approval processes and signatures, stamps as well as the review of check marks indicating that the necessary controls have been perfomed. |
| | 2 | Substantive analytical procedures are conducted during the planning and review stages of the audit: The auditor compares the financial information of Barnes & Noble as per the current financial report and the past annual reports of the firm. | Phase 2 | Understanding the
effectiveness of the
analytical procedures
adopted by Barnes & Noble |
| | | Checks on the company's anticipated results as well as forecasts and budgets as compared to the financial infromation of another company within the same industry. |
| | | Conduct comparisons of the company's transactions at transaction as well as assertion levels. |
| | 3 | Testing of the account balances is vital to determine the correctness of the balances recorded in the company's financial reports: | Phase 2 | Understanding the
correctness of the
account balances recorded
in the company's statements |
| | | Issuance of bank confimartion to determine the ending cash balances |
| | | Contacting a selected sample of customers to confirm the correctness of the account receivable balances recorded
in the financial statements |
| | | Observation the end-of period physical inventory count |
| | | Matching of physical assets to the fixed assets record kept by the company |
| | | Determination of the correctness of accounts payable balances by contacting a selected sample of suppliers |
| | | Contacting lenders to determine the correctness of the loan balances captured in the company's account statements. |
| | | Review the minutes of the board of dircetors to verify the existence of the dividends approved and recorded in the company's financial reports. |
| | | Ascertain the validity of the calculations applied in inventory valuation. |
| | 4 | Carry out a classification testing to ascertain whether the company's transactions were correclty classified in the accounting records |
| | | Completeness testing to determine whether there are any missing transactions
from the company's accounting records. |
| | | Conduct cut-off tests to ascertain whether transactions are recorded in the period
within which they occured. | Phase 3 | Testing various assertions regarding
the compnay's transactions |
| | | Obtain supporting documents for the occurrence of various transactions
in the company.For example, invoices support the acquisitions made. |
| | | Determine the actual existence of assets or inventory to
evaluate the transactions. |
Kiary43
Copyof20190622011330financial_instruments-1.xlsx
