In previous posts in relation to auditing creditors, we mentioned about:
- Review of Creditors' Statement of Account
- Purchase Cut-off testing
- Comparison of current year balance to prior year balance
In addition to the above, it would be good if a creditors' turnover analysis is performed:
Creditors Turnover (day): Purchase/ Average Trade Creditors x 365 [for periodic inventory system]
Creditors Turnover (day): Purchase/ Average Trade Creditors x 365 [for perpetual inventory system]
Auditor can compare the creditors' turnover (day) computed above to general creditor term given by the creditors to assess if the Company has been repaying on time. If the creditors' turnover (day) is significantly longer than the credit term given by suppliers, this might indicate the liquidity issue the Company is facing.
#94- Auditing Creditors III
In our previous entries in relation to auditing creditors and auditing creditors II, we discussed about the audit procedures for trade creditors balances:
(i) Review of Creditors' Statement of Account
(ii)Purchase cut-off testing [ Please also refer to interesting comments posted by our readers
Apart from the procedures mentioned above, auditor should also perform analytical review, by comparing current year creditors' balance to prior year creditors' balance to investigate if there's any unusual fluctuations or absence of expected fluctuations.
For instance, sales volume for ABC company reduced substantially during the year, while the trade creditors balance has increased significantly. We need to understand / analyse the reasons caused the increase in trade creditors' balance while the sales volume has dropped substantially. One of the possible answer is due to the ABC Company is having liquidity issue, and resulted in delaying in repaying its trade creditors.
A good and thorough analytical review give auditor a better understanding of the business.
(i) Review of Creditors' Statement of Account
(ii)Purchase cut-off testing [ Please also refer to interesting comments posted by our readers
Apart from the procedures mentioned above, auditor should also perform analytical review, by comparing current year creditors' balance to prior year creditors' balance to investigate if there's any unusual fluctuations or absence of expected fluctuations.
For instance, sales volume for ABC company reduced substantially during the year, while the trade creditors balance has increased significantly. We need to understand / analyse the reasons caused the increase in trade creditors' balance while the sales volume has dropped substantially. One of the possible answer is due to the ABC Company is having liquidity issue, and resulted in delaying in repaying its trade creditors.
A good and thorough analytical review give auditor a better understanding of the business.
Closing of Account in Numia
Numia provides you a way to close your account by retrieving all your accounting transactions. Closing of your accounts prevents you from logging in and to access any of the services provided by Numia. The steps followed in closing of account in Numia are
1) Select Company -> Close Numia Account.
2) A new window will be opened similar to the screenshot as below.
3) By clicking the "Close Account" Button, Your account will be closed.
As soon as you closed your account, You are not logged out immediately. You may manage your accounts even now too and it will be audited as before.
If you want to reactivate your account with Numia, You will be given a period of 48 hours or 2 days (from the time you closed your account) to login again. You or the persons linked with this account can login to the website within this stipulated period of time to activate your account.
After the deadline given by Numia to reactive your account is completed, Your account will be permanently closed. You can contact support@numia.biz for retrieval of your accounting records or any kind of assistance.
1) Select Company -> Close Numia Account.
2) A new window will be opened similar to the screenshot as below.
3) By clicking the "Close Account" Button, Your account will be closed.As soon as you closed your account, You are not logged out immediately. You may manage your accounts even now too and it will be audited as before.
If you want to reactivate your account with Numia, You will be given a period of 48 hours or 2 days (from the time you closed your account) to login again. You or the persons linked with this account can login to the website within this stipulated period of time to activate your account.
After the deadline given by Numia to reactive your account is completed, Your account will be permanently closed. You can contact support@numia.biz for retrieval of your accounting records or any kind of assistance.
Banking Registers
Register is basically the official written record of names or events or transactions. Banking Registers are the records which are maintained in order to keep track of your banking transactions.
Numia, online accounting software not only helps you to record your accounting transactions or maintain your banking records, but also enables you to edit or delete the transaction. You can view the report of the transactions each and every bank separately within your desired time period.
The steps involved are as follows:
• Select Bank-> Banking Registers.
• Select the bank name to view the accounting transactions in that specified bank.
• Select the account name.
• Now you can view the list of transactions made in that bank in the corresponding account name.
• Edit or delete the transaction by just clicking the edit or delete icons which is viewed by moving the cursor over the transaction.
• You can also customize the report by clicking “Customize” option. Customizing allows you to view the transaction report within specified dates and to differentiate the transactions based on reconciliation.
• You can also export the report to “Excel spreadsheet” or simply print it.
Numia, online accounting software not only helps you to record your accounting transactions or maintain your banking records, but also enables you to edit or delete the transaction. You can view the report of the transactions each and every bank separately within your desired time period.
The steps involved are as follows:
• Select Bank-> Banking Registers.
• Select the bank name to view the accounting transactions in that specified bank.
• Select the account name.
• Now you can view the list of transactions made in that bank in the corresponding account name.
• Edit or delete the transaction by just clicking the edit or delete icons which is viewed by moving the cursor over the transaction.
• You can also customize the report by clicking “Customize” option. Customizing allows you to view the transaction report within specified dates and to differentiate the transactions based on reconciliation.
• You can also export the report to “Excel spreadsheet” or simply print it.
Exporting your Report to Excel Spreadsheet
In Numia, You can easily export your report to excel spreadsheet. By exporting your report, You may be able to save the report under any name in your desired path and you can make whatever changes you want to do. The steps involved are given below:
1.Select Report -> Choose the report you want to export.
2.Click “Excel Spreadsheet” Button.
3.Choose “Save file”.
4.Select the folder where you want to save the file. You can also change the name of the file.
5.Open the file in excel and make the changes you want. This change does not affect the data in the Numia reports.
The screenshot is as follows.
1.Select Report -> Choose the report you want to export.
2.Click “Excel Spreadsheet” Button.
3.Choose “Save file”.
4.Select the folder where you want to save the file. You can also change the name of the file.
5.Open the file in excel and make the changes you want. This change does not affect the data in the Numia reports.
The screenshot is as follows.
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