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DEBTOR VERIFICATION

This query is : Resolved 
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(Querist)
21 January 2010 THE DEBTORS OF THE COMPANY ARE SHOWING BALANCE (AGEING ) OF MORE THAN 180 DAYS PENDING WHILE THE AVG. COLLECTION PERIOD OF THE COMPANY IS 90 DAYS. AND ALSO THE MGMT OF THE COMPANY SAID THAT THEY DONT HAVE THIRD PARTY CONFIRMATION FROM THE DEBTORS.
PLEASE SUGGEST THAT AS AN AUDITOR OF THE CO. WHAT SHOULD I DO?
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CA Vijay Kumar Gupta

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CA Vijay Kumar Gupta (Expert)
21 January 2010 Send a/c statement todebtors directly stating that if no reply is recd. with in 10 days, it will be presumed that the balance is correct.
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Rasesh

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Rasesh (Expert)
21 January 2010 Agree with Expert.

Additional Point:
1)Ask them to make provision for doubtful debts if debtors are old for more than 6 months
2) Obtain explanation as to when old debtors would be recovered.
3) Track the status in the next audit
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