Audit of purchases ledger/Book:
After the books of original entries have been vouched and pasting there from fully checked, the following further steps should be taken in connection with the audit the purchases ledger which is also called Sundray creditors ledger or accounts payable ledger.
1. Casts:
The casts and carry forwards of the purchases ledger should be checked.
2. List of balances:
The list of closing balances of creditors should be checked with the purchases ledger and the control account of the above ledger in the general ledger should be tallied with the total of the list of balances. The casts of the schedule of creditors should also be checked.
3. Confirmation:
The purchases ledger balances should be compared with the confirmation or statement of account received. Any differences must be sorted out and reconciled.
4. Old balance:
The amount remained arrogate or unclaimed for a long time, should be noted and those which do not represent payable, should be suggested for write off.
5. Dispute cases:
If certain amounts due to the creditors are in dispute, it should be seen that they are shown as contingent liability and are adequately provided for in the accounts.
6. Debit balance:
In the case of debit balances on any of the accounts, the auditor must satisfy himself that they are really recoverable.
7. Scrutiny:
Scrutiny should be made to make sure that no item is left unlike.
Audit of sales ledger/Book:
Sales ledger is also called sundry debtors ledger or accounts receivable ledger. After the books of original entries have been vouched and pasting checked, similar work as explain under the audit of purchase ledger should be carried out for the audit of the sales ledger.
Further, the list of debtors must be thoroughly scrutinized. Any legally time barred debts must be written off. Steps should be taken to ensure that adequate and proper provision for doubtful accounts.
Audit of general ledger/Book:
After the pasting in to general ledger has been checked, the following work should be done to audit the general ledger.
1. Casts:
Casts and carry forwards of the accounts of the general ledger should be checked.
2. Scrutiny:
The general ledger should be scrutinized to ensure that no entry remains unlike. This would assist in uncovering the cases of entries which did not exist in any of the books of original entries.
3. Trial balance:
The closing balances of the general ledger must be checked with the trial balance.
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