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.
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.
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