A company has 25 branches in India. Draft an audit plan to monitor sales activities and receivables. The total sales of the company in India is ₹200 crore and outside India ₹100 crore. (a) What would be the possible cont

Audit Plan Area Verification Needed 1. Dispatches from factory to branches Reconcile delivery challans with inward store entries at branches. 2. Dispatches at branch Verify store entries with e-way bills 3. Invoicing Verify purchase order raised by customers Verify e-way bills with invoices raised along with consignment note for transportation of goods in case of domestic sales Verify the contents of bill of entry in case of exports Verify the custom clearance Verify the adequate transit insurance in both domestic and export sales 4. Receivables Verify receipts with invoices. Verify bank entries with customer details. Verification of genuineness of Credit Notes for Sales returns Verify age of receivables. Carry out Balance confirmation exercises. Possible control weaknesses: Goods dispatched but not billed. Goods dispatched more but invoice raised for less (both quantity and value) Payment not received against bills. Excess credit to customer. Unauthorised Credit Notes reversing revenue and misappropriating money Teeming and Lading Payment received but not recorded in books Receipts not recorded in account of correct customers Control features: Inventory should be properly controlled and physically verified. Regular reconciliation of invoices with e-way bills, weightment slip and consignment notes. Follow up on receivables and ensuring age of outstanding as well as amount in the credit limit. Journal entries passed in the books should be scrutinised using Data Analytics