ACCA F8 Audit Question Advice

Hi everyone,

I just wondered if any of the F8 peoples would give me an opinion on a question I answered this
morning?

The question asked for possible substantive tests to be conducted on the Trade payables section
of a company making tables and furniture.

I gave some basic tests such as:

1) Select a sample of purchase invoices and reconcile against PO and GRN (Accuracy)

2) Check sample of purchase orders for sequential numbering (Completeness)

3) Reconcile sample of purchase invoices against purchase ledger, making sure they have been
entered into the correct supplier accounts at the correct value and they also have a corresponding
value in the purchase ledger control account (Accuracy)

4) Review a sample of post FYE bank payment transactions to ascertain if their were any outstanding
liabilities at the FYE not recorded as accruals (Cut-off, completeness)

5) Analytical proocedures - Compare creditor days between this and last year, assess total trade
payables figure in relation to last years figure. Are there any significant variations to investigate?

6) Recalculate corporation tax computation to assess accuracy of tax balanct at year end. Also
reconcile payroll tax computations with payroll records at year end (Accuracy)

7) Obtain bank confirmation letter, with client permission, to ascertain balance of overdrafts and
review bank statement balances at FYE for proof of overdrafts.

8) Creditors circularisation letters sent to creditors to confirm balances of material creditor balances,
check supplier statement for evidence of credit balances.

Many thanks

Mark