Control testing, Revenue and receivables- For a representative sample of invoices issued to customers during the year, inspect for evidence that the client has matched the invoices to the order and delivery note and that the details agree, Observe client staff in the warehouse are correctly following documented procedures, and that goods sent out are checked to the order before being despatched, For a sample of payments to suppliers in the cash book, agree to the original invoice and ensure the supplier is listed on the approved supplier list., Payroll- Review a sample of staff who joined the client in the year to ensure that they've been correctly recorded in the month they joined., For a sample of disposals of non-current assets, ensure that the sale of the asset was appropriately authorised, Ensure that the client carries out regular bank reconciliations, and that there is evidence that these are approved by an appropriate senior member of staf, Substantive testing, For a sample of trade receivables send a letter asking the customer to confirm the balance that they owe the client, or state the balance that they believe they owe., Compare monthly purchases for the year with monthly purchases for the previous year and obtain explanations for any unusual variances, Compare average salary per employee with the same figure for previous years, and with the % pay increase for the year, For a sample of disposals of non-current assets, ensure that the profit or loss on disposal has been correctly calculated., Select a sample of items and count them independently from the client staff, and then compare them with the client’s records for the same items., At the client’s inventory count make a note of any damaged, obsolete or slow-moving inventory to ensure that these are separately identified and can be correctly valued, Calculate the inventory turnover for the financial year and compare it with previous years. Investigate any unusual differences., Check the client’s year end bank reconciliation in detail, and trace all unpresented cheques and uncredited lodgements to the client’s bank statements after the year end.

Applied Control or Substantive testing

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