AUDIT OF IMPERSONAL LEDGER PDF

Therefore, contingent liabilities are said to be possible liabilities. Such adjustments relate to outstanding assets and liabilities and depreciation etc. Such contingent assets may be stated as footnote for disclosure requirements. The auditor can, maintain accuracy of accounts. The auditor should check postings of various cils11 payments and receipts in respect of nominal accounts in the impersonal ledger.

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Impersonal accounts refer to real accounts and nominal accounts which are related to a trading account, profit and loss account, and balance sheet. Nominal accounts are related to Trading and Profit A Loss Accounts whereas real accounts record assets.

So, if there are any errors in such accounts, they will affect adversely to the report and financial statements which are to be signed by the auditor.

Checking of such accounts is known as an audit of the impersonal ledger. It does not only assure the correctness and reliability of nominal accounts but also helps to detect the errors which remain in personal accounts.

Such audit is conducted with the help of cash book, journal and subsidiary books. Following works are to be performed for the audit of the impersonal ledger: Cash transactions are to be checked on the basis of cash book or journal. The postings of cash transactions to the Impersonal Ledger should be carefully checked.

Other impersonal transactions are to be recorded on the basis of sufficient evidence. The Journal should be carefully vouched to ensure that each entry is supported by sufficient evidence. An auditor has to check whether it is recorded on the basis of evidence or not. Special attention should be given while checking transfer entries because it affects the final accounts.

The total of the subsidiary books should be checked. Totals and balances of the impersonal ledger should be ratified with the balance shown in the trial balance. The balances in the Impersonal Ledger should be checked and verified with the Trial Balance. Reviewing truthfulness of debtor balances in a customer account. Opening balance of impersonal ledger should be verified with the audited account of the previous year.

Reviewing of Internal Control System. The auditor should thoroughly check the totals of the various other books of original entry and also the postings of their totals of the impersonal ledger.

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What are Impersonal Ledgers? | How are they vouched?

What are Impersonal Ledgers? How are they vouched? What are Impersonal ledgers? Impersonal ledgers are also called General Ledgers or Nominal Ledgers. They are of two types such as Nominal Accounts and Real Accounts. Nominal accounts are related to Trading and Profit A Loss Accounts whereas real accounts record assets. If these accounts are not correct, they will affect the Profit and Loss Account and the Balance Sheet.

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Auditing - Vouching of Ledger

Samurr Expenses of heavy repairs of fixed assets shall not be debited to profit and loss account of year in which these expenses incurred but it should be spread to number of years like other deferred revenue expenses. The remaining amount may be called up i,personal creditors in case of winding up of a company. The regular renewal means bad debts. The profit revealed by Profit and Loss Account will thus get inflated. The Impersonal Ledger will be Vouched as Follows: The Auditor should carefully examine the interest on loan from bank, loan from outsider parties, unsecured loan, financial institutions, term loan and interest on debentures.

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Notes on Audit of Ledgers – Guidelines to Auditors

You know that balances of nominal accounts are transferred to Trading and Profit and Loss Account while balances of real. We will now study the vouching of items which appear in the impersonal ledger and relate to Profit and Loss Account. The Impersonal Ledger will be Vouched as Follows : The auditor should check postings of various cils11 payments and receipts in respect of nominal accounts in the impersonal ledger. These transactions can be salaries, wages, rent, etc, paid in cash or dividends, interest, etc. The auditor should check the totals of all the subsidiary books, and their postings in the relevant nominal accounts in the impersonal ledger.

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