34) Assertions Specific Substantive

GENERAL SUBSTANTIVE PROCEDURES – (Assertions Specific)
Procedure – on COMPLETENESS of INCOME/REVENUE

- Perform analytical procedure by comparing the revenue from the past years and discuss with the
management and investigate the significant difference.
- Obtain the list of customers, sent GDNs and invoices and cast to confirm the completeness.
- Perform proof in total calculation, obtaining the units sold and multiply with the average selling
price and compare with the reported revenue and discuss and investigate the significant difference.
- Calculate GP margin and compare with the past years and industry averages and investigate the
significant difference.
- Agree the total revenue in the receivable ledger, control account and trial balance to confirm
completeness.
- Obtain the sales records and contracts and ensure revenue is completely recorded for all those
orders whose performing conditions are met as per IFRS-15.
Procedures – on VALUATION of Receivables
- Perform analytical procedure on receivable by comparing over the past years and investigate the
significant difference and also discuss with the management.
- Inspect the aged receivable analysis and discuss with the management whether any allowance is
needed.
- Calculate the receivable collection period and compare with the past years and investigate the
significant difference and also consider and discuss the need for any allowance.
- Review the correspondence of the company with the customers to identify the disputed balance or
balance unlikely to be paid.
- Review the post-year-end cash receipts and follow in the pre-year-end receivable balance.
- Obtain the positive confirmation from the customers with the permission of management to
confirm the year-end balance of receivable.
- Recalculate the total receivables to verify the accurate valuation at year-end.
- Perform proof in total, estimate the allowance of receivable and compare with that of management
and consider to discuss and investigate the significant difference.
Assertions Specific Substantive 1 By:- Haris Hanif

Procedures – on EXISTENCE of receivables
- Review the correspondence of the company with the customers to identify the disputed balance or
balance unlikely to be paid.
- Obtain the P.O.s from the customers and sent invoices and GDNs to look for the signature of
customers.
Procedures – RIGHTS and OBLIGATIONS of receivables
- Obtain the P.O.s of customers and sent invoices and see the name of the customers on it.
- Review the GDNs sent and see the signature of evidence of goods despatched to them.
- Review the agreement with any factor organisation whether any receivables were sold to them.
Procedures – on VALUATION of payables
- Perform analytical procedure on the payables by comparing over the past years and investigate the
- Agree the opening balance with the last year closing balance to ensure exact amount is carried
down.
- Calculate the payable days and compare with the past and industry averages and discuss and
investigate the significant differences.
- If any amount is paid during the year, agree the paid amount in the cash book.
- Obtain the supplier statement to agree the year-end payable balance.
- Send the positive confirmation letter to the supplier to confirm the year-end payable balance.
- Review the post-year-end cash payment record and follow in the year-end payable balance.

Procedure – on Cut – off of sales.
- Obtain the GDNs sent before and after year-end and follow in the receivable ledger, sales records
to ensure it is recorded in the correct time period.
- Obtain the sale agreement and see the date when then performing obligations were met and
follow the sales in the correct accounting period.
- Perform analytical procedure by comparing the revenue from the past years and discuss with the
management and investigate the significant difference.
- Calculate GP margin and compare with the past years and industry averages and investigate the
Procedures – on PAYROLL
- Perform analytical procedures on payroll by comparing over the past years and discuss and
investigate the significant difference.
- Perform proof in total calculation on payroll by multiplying number of employees with average
wage rate and compare with the reported payroll expense and discuss and investigate the
- Obtain the payroll records and ensure that all statutory deductions were deducted.
- Obtain the payroll records and agree it as expense in the income statement.
- Agree the wages paid in the bank statement and agree with the payroll records.
- Obtain and recalculate the payroll calculations to verify the mathematical accuracy of figures.
- Review the notes to the accounts to ensure the necessary and complete disclosure of payroll.

Procedures – on VALUATION of Inventory
- Obtain the breakdown of inventory standard cost and agree it includes DM, DL, P-OHs.
- Agree the cost of DM with the invoices, labour cost from payroll records and discuss with
management how overheads are estimated and ensure basis are reliable.
- Compare standard cost with the actual cost to ensure standard cost is close approximated to the
actual cost.
- Compare inventory value over the prior years and investigate the significant variations.
- Calculate inventory turnover days and compare over the prior years and investigate the significant
differences.
- Review the inventory records for slow moving inventories and discuss with the management
whether it should be written down.

34) Assertions Specific Substantive

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34) Assertions Specific Substantive

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GENERAL SUBSTANTIVE PROCEDURES – (Assertions Specific)

Procedure – on COMPLETENESS of INCOME/REVENUE

Procedures – on VALUATION of Receivables

- Recalculate the total receivables to verify the accurate valuation at year-end.

Assertions Specific Substantive 1 By:- Haris Hanif

- Obtain the supplier statement to agree the year-end payable balance.

Assertions Specific Substantive 2 By:- Haris Hanif

Assertions Specific Substantive 3 By:- Haris Hanif

Assertions Specific Substantive 4 By:- Haris Hanif

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