Total Accounts Receivable
Bradmark Wholesale
General Supply
ACL Case Study
This paper contains the summary of the details and results of the audit tests on
Bradmark’s Revenue and Expenditure Cycles. The audit tests were performed through the ACL Program.
2005
Rachelle Cultura | Trixia Ebol | Christine Fonseca
Mary Rose Samas | Nadaine Tongco
Ross & Specter Co.
October 24, 2012
1 | P a g e
REVENUE CYLCE
Assessment of Internal Controls over the Revenue Cycle
The assessment of Bradmark’s internal controls over its revenue cycle procedures were done through the analysis of the processes each department is undertaking.
For the Sales Department, it is but right that the clerk will seek the approval of the credit manager for customers with insufficient available credit. However, the credit manager should not only verbally authorize the clerk to change credit limits. More so, it is inappropriate for him to delegate the said task to the clerk as it violates the general control of authorization.
Reconciliation of the documents – packing slip, shipping notice, and bill of lading – with the goods to be shipped must likewise be done for independent verification. Several copies of these documents must be made to be filed for future reference and monitored by the departments responsible in the each of the operational processes.
In conclusion, Bradmark needs to improve some of the internal controls over its revenue cycle procedures.
Existence or Occurrence
From Bradmark’s data files on sales invoices, cash receipts and list of customers, the ACL software was used to compute and determine the Accounts Receivable balances of customers in the books.
January 20, 2005
United City
920 4 th Street
Bridgewater, New Jersey
8807
Dear Sir/Madam,
In connection with an examination of our financial statements by Ross & Specter Co., Certified Public Accountants, 8th Avenue,
Manhattan, New York (NY) 10014, we will appreciate it if you will indicate the
General Supply
ACL Case Study
This paper contains the summary of the details and results of the audit tests on
Bradmark’s Revenue and Expenditure Cycles. The audit tests were performed through the ACL Program.
2005
Rachelle Cultura | Trixia Ebol | Christine Fonseca
Mary Rose Samas | Nadaine Tongco
Ross & Specter Co.
October 24, 2012
1 | P a g e
REVENUE CYLCE
Assessment of Internal Controls over the Revenue Cycle
The assessment of Bradmark’s internal controls over its revenue cycle procedures were done through the analysis of the processes each department is undertaking.
For the Sales Department, it is but right that the clerk will seek the approval of the credit manager for customers with insufficient available credit. However, the credit manager should not only verbally authorize the clerk to change credit limits. More so, it is inappropriate for him to delegate the said task to the clerk as it violates the general control of authorization.
Reconciliation of the documents – packing slip, shipping notice, and bill of lading – with the goods to be shipped must likewise be done for independent verification. Several copies of these documents must be made to be filed for future reference and monitored by the departments responsible in the each of the operational processes.
In conclusion, Bradmark needs to improve some of the internal controls over its revenue cycle procedures.
Existence or Occurrence
From Bradmark’s data files on sales invoices, cash receipts and list of customers, the ACL software was used to compute and determine the Accounts Receivable balances of customers in the books.
January 20, 2005
United City
920 4 th Street
Bridgewater, New Jersey
8807
Dear Sir/Madam,
In connection with an examination of our financial statements by Ross & Specter Co., Certified Public Accountants, 8th Avenue,
Manhattan, New York (NY) 10014, we will appreciate it if you will indicate the