LEDGER SCRUTINY
This query is : Resolved
20 July 2011
Sir/Madam
Please tell me.
What is procedure of LEDGER SCRUTINY in statutory Audit.
Please tell me.
What is procedure of LEDGER SCRUTINY in statutory Audit.
21 July 2011
Ledger Scrutiny is done with the purpose of finding out any anomalies in Ledgers.
You need to verify the following:-
1) A ledger that normally should have Debit balance should not show a credit balance.
Eg. Credit balance in Debtors Account. If it does find reasons for the same.
2) Similarly accounts that should normally show credit balance should not reflect Debit balance.
3)Scrutinise Capital Account, Reserves, Loan Accounts and see if entries posted are in order.
4) select P&L Accounts with major amounts and study the entries passed in those accounts.
5) Also see in case of Expense Ledgers if TDS has been correctly deducted and paid.
6) Check Ledger accounts with Inter company entries.
In short, Once the ledger scrutiny is done, You should get a comfort that all transactions are justified and properly disclosed in the accounts.
You need to verify the following:-
1) A ledger that normally should have Debit balance should not show a credit balance.
Eg. Credit balance in Debtors Account. If it does find reasons for the same.
2) Similarly accounts that should normally show credit balance should not reflect Debit balance.
3)Scrutinise Capital Account, Reserves, Loan Accounts and see if entries posted are in order.
4) select P&L Accounts with major amounts and study the entries passed in those accounts.
5) Also see in case of Expense Ledgers if TDS has been correctly deducted and paid.
6) Check Ledger accounts with Inter company entries.
In short, Once the ledger scrutiny is done, You should get a comfort that all transactions are justified and properly disclosed in the accounts.
23 July 2011
What anisha has told is absolutely correct. The term ledger scrutiny is a broad term and Anisha has noted down some examples of areas to be covered in ledger scrutiny. Ledger scrutiny under statutory audit is with the purpose of getting that level of comfort which will enable you to give your opinion on financial statements as an auditor.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- About TDS & Income Tax
- Section 194JA & JB Income which ITR Form to use
- Pass word to open justification report for Q1 for FY 2026-27
- PPF interest-As Exempt Income disclosure
- Under construction property in ITR
- Scrutiny and reopening of past returns
- Booth for sales promotion
- Upload Level ValidationITR3Category of Defect B/D
- Building tax payment deduction in rental Income
- F & O PROFIT REPORTING FOR AY 2026-27
- Difference in GSTR3B system generated which is correct and actual Payment it asks
- Indian IT Portal issue in computing tax as per UK-India DTAA
- Capital Gains on sale of residential flat
- PF Taxable Income
- Clarification on Tax Audit Applicability and Reporting of F&O Transactions in ITR-3
- Interest credited in FY2025-2026 & TDS therein by EPFO does not reflect in AIS or Form 26AS
- 44ad eligble money lending interest
- Taxation in the hands of Landowner under JDA
- Delisted shares sold in off market/ Rebate u/s87A
- In Exports Sales HSN details where to fill
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
