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Controls over customers' creditworthiness
(1) 
For a sample of new accounts opened during the period check to see that suitable 
references were obtained before the company supplied any goods on credit terms 
and that the credit limit set was properly authorised and of a reasonable amount. 
(2) 
For a sample of customers' orders check to see that, at the time they were 
accepted, their invoice value would not have been such as to cause the balance on 
those customers' account to go above their agreed credit limit. 
(ii) 
Controls over the recording of sales and receivables
(1) 
On a sample basis check the completeness of the sequence of order forms and also 
that unused inventory of order forms are securely stored.
(2) 
For a sample of order forms raised during the period ensure that they can be traced 
through the system such that there is either evidence that the order was cancelled 
or that a valid invoice was subsequently raised.
(iii) 
Control over the issue of inventory and the despatch of goods
(1) 
For a sample of entries in the inventory records check to ensure that a valid order 
form exists for all issues recorded as having been made.
(2) 
Attend the inventory rooms to observe the procedures and check that goods are not 
issued unless a valid order form has been received and that the appropriate entries 
are made in the inventory records and on the order form at the time of issue. 
(iv) 
Control over the invoicing of customers
(1) 
On a sample basis check the completeness of the sequence of invoices raised and 
also that the unused inventory of invoice forms are securely stored.
(2) 
For a sample of invoices raised during the period ensure that they have been 
properly matched with the appropriate order form (copy 2).
 
BPP Tutor Toolkit Copy

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