The Following Procedure Should Be Adopted for Verifying Bills Payable:

Topics: Income statement, Accounts receivable, Money Pages: 2 (367 words) Published: December 30, 2012
The Following procedure should be adopted for verifying bills payable: 1. The auditor should obtain a schedule of the bills payable which are outstanding as on the date of the balance sheet and tally the total of this schedule with the bills payable Book and bills payable account 2. The bills on which a payment has been made are received back in to the business. Therefore the amount of bills payable can be verified with respect to the bills received back into the business. Also such bills on which payment has been made should be matched with the cash book or bank pass book. 3. If any bills have been dishonoured or renewed and the organisation has had to pay any interest or noting charges, then the auditor should see that the same has been recorded approximately in the books or not. Also the auditor should see wheather the above mentioned expenses have been taken in the profit and loss account or not. 4. To verify the bills payable as on the date of the balance sheet, the cash book should be verified for a couple of weeks after the balance sheet date to ensure that between the balance sheet date and the date of the audit a payment has not been made on any bill. In case of any suspicion, the auditor should do written communication with the drawers of the bills to find out the correct amount of the bill.

Bills Payable A/c
2012DATE| PARTICULARS| JF| AMOUNT| 2012DATE| PARTICULARS| JF| AMOUNT| 4.Jan| To Bank A/c| | 10000| 1.Jan| By Balance b/d| | 10000| 11.Feb| To Bank A/c| | 5000| 9.Jan| By Ram A/c | | 5000| 26.Mar| To Kaushik A/c | | 7000| 16.Feb| By Balram A/c | | 10000| 13.Jun| To Bank A/c | | 10000| 18.Feb| By Kaushik A/c| | 7000| 22.Sep | To Bank A/c| |

18000| 27.Aug| By Ankit A/c| | 30000|
22.Sep| To Discount A/c| |...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Admission Procedure Adopted in an Organisation Essay
  • Audit procedure Research Paper
  • Essay about civil procedure:
  • Criminal Procedures Essay
  • criminal procedure Essay
  • Account Payable Essay
  • Essay on Adopted Children Should Have Access to Birth Records
  • Report on the procedure of discounting and collecting Hindies (Bills of Exchange) Essay

Become a StudyMode Member

Sign Up - It's Free