Скачать или смотреть Auditing - Verification of Outstanding Expenses, Bills Payable & Creditors

Accrual Accounting:- “Accrual” is the Fundamental basis of Accounting. A Limited Company must maintain its accounts on Accrual Basis. Under this basis,
Expenses which have accrued are booked even if not actually paid.
Scrutiny of Expenses A/c:- Auditor should scrutinise all expense accounts (especially Accounts like Service Charges Paid, Interest, Rent, Salaries, Royalties etc.) to ascertain the amounts outstanding or prepaid.
General Rule:- As a general rule, expenses should be booked when they have accrued as per the terms of agreement between the parties.
Service Charges:- Service Charges Accrue when the Service is performed and complete. Thus, Charges for Job work accrue when the job or processing is complete. If a job is complete at the year end, but not yet billed, Auditor should ensure that the service charges are shown as Accrued and Payable in the books.
Interest Due:- Interest accrues on time basis at the rate agreed. Thus, if a Loan Agreement states that interest on loan of ₹ 100000 is payable @ 20% per year, interest for an year would be ₹ 20000. If only ₹ 15000 are paid till the year end, interest of ₹ 5000 has accrued and must be booked as Outstanding Expenses.