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This presentation takes you through the impact of Technology on Audit Environment. There are lot of slides from Tally which is an eye opener in the sense, that how a cheap software like Tally can be ...

This presentation takes you through the impact of Technology on Audit Environment. There are lot of slides from Tally which is an eye opener in the sense, that how a cheap software like Tally can be effectively used for Audit purposes like planning, documentation, query management. There is also some sharing on what is seen in SAP Environment.

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  • In this slide the points that will be discussed in the presentation are mentioned.
  • Note: This is the main menu of the AE tool consisting of Tax Audit, Statutory Audit and Compliance menus.The Tax Audit menus consists of:44AB AuditForm 3CDForm 3CAForm 3CB
  • Note:This is the dashboard of the clauses under the Sec 44AB Audit . It provides a snapshot of the clauses to be audited The current number of audited, unaudited vouchersThe number of vouchers: Under Observation Needing Clarification Clarified (but to be audited again) Altered by the Client after a preliminary audit (those again have to be audited) Whether clauses are audited.In addition we have the following buttons:F2: Period: Choose the period of transactions for auditAlt+F9: Save Audit- To save the audit of the clause.Alt+C: Clarification List: This is the list of clarifications that have been sought and the replies by the clientF11: Features: Displays the Audit Rules defined for the audit.F12: Configure: The details of audits conducted of the previous year under each clause.
  • Note:In the Annexures to Form 3CD screen, click the Bonus, PF, ESI Recoveries feature to display the Employee Deduction screenThe screen displays the amounts of statutory deductions, the payment status and the current audit statusSelect the desired statutory deduction and click to display the Payroll Monthly Summary screen for audit.Drill further to payment voucher level details and select the required voucher(s) for audit. ( Press the spacebar to select any voucher)Press F9 to perform the audit.
  • Under this clause the Auditor has to report on cash payments aggregating and exceeding Rs.20000 in a day ( increased to Rs30000 in the next FY).
  • The initial configuration before audit in F11: Features is defined in that screen.Some payments are exempt from cash payment rule, for example, payments of taxes to Govt or payments in rural/moffusil places where banking facilities are not available or if the recipient of cash has no bank account or the local traditions demand payments by cash only.For this purpose the Rule 6DD allows you to exclude such ledgers from the purview of the tax audit.
  • The Auditor can generate reports on the lowest and highest values of payments. Further the Auditor can provide any values of ranges to generate a report on cash payments.Notice the lowest and highest values of payments displayed for a ledger account.Select any ledger account and drill down to the payment level for audit.
  • If the Auditor is concerned about the issue of Bearer Cheques, the AE provides a list of bank payment transactions for analysis. The Auditor can select such transactions for audit and satisfy if they are paid through A/c payee cheque/DD or the client has issued bearer/self cheques. For this exercise, the Auditor has to check the bank statements and cheque counterfoils to satisfy that the payments were made as per law.
  • The display of details in the Cash Payments to aid the Auditor in the audit work. The F12: Configure button allows the auditor to define the limits for cash payments, display high and low payment values,etc.
  • The method of auditing is described here and the values for the Audit Status.Drill down to the voucher level, select the transaction and use F9: Audit to perform the audit.The status values for Audit Status are: Unknown: This status is chosen when the auditor has not decided about the outcome of the audit of the payment transaction or wants to change the decision taken earlier.Disallowed: The amounts paid late or unpaid are not allowed as deductions in computing the taxable income.Need Clarification: The Auditor wants more information from the Client before deciding on the audit decision.Under Observation: The Auditor is yet to form an opinion on the transaction under audit and wants to collect more information/consult supervisors before taking a decision.
  • Note:Printed report - Annexure for Clause 17h
  • Note: Certain payments to persons who are closely related to the client and may be Directors, Partners, Relatives, etc. have to be reported in the Tax Audit. The Auditor before starting the audit consults the Client and obtains the information on such payments. The other type of payments that the Auditor is interested if they are unusual and are excessive/unreasonable.Ledger accounts created for such persons can be configured using the Ctrl+F9:Master feature or the Ledger Master creation screen.The Auditor can also configure the display of information on the Payments to Specified Persons screen by using the F12: Configure button menu.
  • Note:Audit of payments to Specified persons can be performed at the voucher level by using the F9:Audit feature.The status values available for Audit Status are:Unknown: This status is chosen when the auditor has not decided about the outcome of the audit of the payment transaction or wants to change the decision taken earlier.Needs Clarification: The Auditor requires more information from the Client before concluding the audit.Not to be Reported: The Auditor decides after verification that the cash payment is allowable as per law in certain cases, like payments to Govt, payments to persons having no bank account, etc.To be Reported: The Auditor has found that the payment was made violating the clause 18 and hence had to be reported in Form 3CD report.Under Observation: The Auditor is still not completed the audit and wants to refer to other sources/Superior for confirmation.
  • Note:Printed report-Annexure for Clause 18.
  • Note:Under this clause any payment of loans/deposits as described under Sec269T are to be made through an account payee cheque/DD if the amount aggregates to and exceeds Rs.20000/- on a day.Click F9:Master to configure the inclusion of any ledger account under Loans and Deposits Repaid for audit.
  • Note:Under this clause any payment of loans/deposits as described under Sec269T are to be made through an account payee cheque/DD if the amount aggregates to and exceeds Rs.20000/- on a day.Click F9:Master to configure the inclusion of any ledger account under Loans and Deposits Repaid for audit.
  • Note:The Auditor can drill down to the voucher to perform the audit of the selected transaction. The audit is performed using the F9:Audit feature.The status values available for Audit Status are:Unknown: This status is chosen when the auditor has not decided about the outcome of the audit of the repayment transaction or wants to change the decision taken earlier.NeedClarification: The Auditor requires more information from the Client before concluding the audit.Not a Loan: The transaction is not a loan and hence will be disallowed as a deduction while computing the taxable income.Repaid by Cash: These are transactions that are repaid by cash and will be disallowed while computing the incomeRepaid by Cheque/DD: These transactions are repaid by a crossed account payee cheque/DD.UnderObservation: The Auditor is still not completed the audit and wants to refer to other sources for confirmation.
  • Note:Printed report -Annexure for Clause 24b.
  • Note:Under this clause the assessee has to report whether tax at source deducted has been paid to the account of the Govt as per Chapter XVII-B of the IT Act. The remittance of the tax deducted at source should be within the prescribed time as specified under the IT Act.To perform this audit, the TDS option in Tally.ERP 9 has to be enabled.The Auditor can view the party and payment details using the Alt+F4:Party and Alt+F5:NOP.The TDS Payment Summary with the details of Deductions and Payments are displayed and also the expense summary.
  • Note:The Auditor can use the F5: Expenses Analysis to compare the TDS and non-TDS expenses.
  • Note:Select the required tax payment by drilling down to the voucher level and audit it by using F9:Audit key.The three audit status values in this clause are:Audited: This refers to the situation where the tax payment has been verified to the fact it has been remitted within time or not.Needs Clarification: The Auditor requires more information from the Client before concluding the audit.UnderObservation: The Auditor is still not completed the audit and wants to refer to other sources for confirmation.
  • Note:Printed report -Annexures for Clause 27b.
  • Note:In the Form 3CD feature, click Alt+P to print the audit report. The Form 3CD is the audit report that is prepared by the Auditor for filing with the IT Dept.
  • Note:The Form 3CA and CB are assertions/opinions made by the Auditor in respect to the conduct of the audit under Sec 44AB and reported by Form 3CD. Form 3CA audit report is prepared for businesses audited under any other laws – partnership, proprietorship, Association of Persons,etc.Form 3CB is an audit report prepared for an assessee who carries on a business other than mentioned under Form 3CA.

Audit and technology Presentation Transcript

  • 1. CA Sandesh MundraSandesh.mundra@smaca.in
  • 2. Impact of IT CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 3. IT has significantly impacted the audit profession in the past two decades• Electronic work papers to facilitate the documentation.• Large firms are developing computerized decision aids to assist them in going concern decisions, client acceptance issues, analytical procedures, etc.• IT impacts the behavior and attitudes of individuals working in the firm, and the structure and processes of the firm.• Enhancement in productivity through audit automation, eliminating certain audit procedures, and enhancing information and knowledge sharing capabilities. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 4. Some Applications in use• Analytical procedures• Internal control evaluation• Sampling tasks• Fraud review• Testing on-line transactions• Administrative/practice management tasks• Knowledge management CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 5. Migration in Expectations• Moon vs Mars• Bigger the organisation – Micro Level Audit• Expressed and Unexpressed Requirements• Are we really required ?• Where lies the future ? – Total no. of CA’s in India is ___________ CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 6. Male vs Female• Male group argued that computer is female because: 1. No one but their creator understands their internal logic 2. The language they use to communicate with other computers can-not be understood by everyone else 3. Even the smallest actions are stored in long term memory for a long time and 4. As soon as you make a commitment to one, you find yourself spending a lot on accessories. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 7. • The womens group, however, concluded that computers should be male, because: 1. In order to do anything with them, you have to turn them on. 2. They have a lot of data but still cant think for themselves. 3. They are supposed to help you solve problems, but half the time they ARE the problem; and 4. as soon as you commit to one, you realize that if you had waited a little longer, you could have bought an improved version. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 8. Impact of IT on Audit• Organisational Walkthrough• Tally • SAP – Audit Planning – Understanding TB – Tax Audit – Auto Entries – Multilocational Client – Role of CAAT Tools• ERP • Excel / Access – Basics – Financial Statements – Audit Methodology – Analysis – Customised vs Ready Made ERP at client – Exceptional Reporting CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 9. Walkthrough• MSO Cable Operator Software in Use Functionality TALLY ERP 9 Accounting LOG2 SPACE Bandwidth Management MQ SUBSCRIBE 5.72 Subscriber Management ORACLE 10G DATABASE Subscriber Database MOBILE PAYMENT SOLUTION Subscriber Collection DCR FORM ENTRY SYSTEM Ad Revenue Booking PAYROLL Payroll Management CRM Material Management ARS WINNET Attendance Management ZIMBRA Email Server CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 10. CA Sandesh MundraSandesh.mundra@smaca.in
  • 11. CA Sandesh MundraSandesh.mundra@smaca.in
  • 12. The New Statutory AuditFeature in Tally.ERP 9 - Auditors’ Edition CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 13. Statutory Audit – Scope Covered Data Analysis Auditing Financial Statements As Per Schedule VI CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 14. Data Analysis – Tools availableVerification of Chart of AccountsVerification of BalancesVerification of Stock itemsAnalytical ProceduresPending Documents Mark the Status as VerificationStatutory Payments Complete after Analysing the data CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 15. Verification of Chart of Accounts Exception Types with Ledger Details All the Ledgers are Listed Under the Different Exception Types CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 16. Verification of Stock Items Verification of Stock Items Report Similar to Chart of Accounts CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 17. Analytical Procedures CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 18. Verification of Statutory Payments CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 19. Auditing/Vouching Verification of Vouchers Related Party Transactions Forex Transactions The Auditing procedure is similar to the Tax Audit Outstanding of MSMEs with respective Audit Status will and the Vouchers be displayed in the respective columns Salary/Wages Payments (including ‘Head Count’) CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 20. Auditing – Related Party Transactions Once the Related Parties are identified, all the Related Party transactions will be available for Scrutiny Auditor can identify the Related Parties with the help of Client CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 21. Auditing – Forex TransactionsAll the transactions involving Forex will be listed for scrutiny. The auditorcan drill down to check the Rate of Exchange used by the Client for each CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 22. Financial Reports – ProvidedBalance Sheet as per Schedule VIProfit & Loss A/c as per Schedule VI CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 23. Schedule VI Balance Sheet – FeaturesCan be generated with just a single clickTally Default Groups (Business Groups) are mapped to Schedule VI groupings by default too.Can be further regrouped as required (User defined)Flexible Schedule numberingGeneration of SchedulesExport to Excel for further formatting if required. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 24. Schedule VI Balance SheetThe selected Group is moved along with theBalance without affecting the actual dataThe Group/Subgroup/Ledger Balances can be MovedFrom one Schedule VI titles to another as required orwithin default Tally Groups. To undo all changes click on button or press F10 Select the Group which needs to beMovement is possible using Ctrl+X Move button or movedCtrl+Enter Configuration screenMove the cursor to the required line To undo last change click on Click on this button or the Click this press Ctrl+U button or button or press press Ctrl+X to CUT/Move Ctrl+V to PASTE CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 25. Schedule VI Balance SheetFinal Schedule VI Balance Sheet With Schedules nos. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 26. Schedule VI Profit & Loss A/c – FeaturesSales & Income Groups are mapped to INCOME by defaultExpenses & Purchase Groups are mapped to EXPENDITUREOption to rename INCOME & EXPENDITURE is provided to support all industriesFlexibility to regroup within INCOME & EXPENDITUREFlexible Schedule numberingGeneration of SchedulesExport to Excel for further formatting if required. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 27. Schedule VI Profit & Loss A/c CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 28. Preparation of Sch VI in Excel• Giving Suffix to Ledgers in Tally• Lets see a demo• Other Advantages of using the suffix CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 29. CA Sandesh MundraSandesh.mundra@smaca.in
  • 30. Tally.ERP 9 Auditors’ EditionTax Audit (Sec 44AB of IT Act) CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 31. AgendaTax Audit under Sec 44AB using Tally.ERP 9 AE • Benefits • Definition & Audit Objective • Audit & Analysis-Features • Clause 16, 17h, 18, 21, 24a, 24b & 27 • Forms 3CD, 3CA & 3CB CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 32. Tax Audit MenuTally Main -> Gateway of Tally->Audit & Compliance The Audit & Compliance Menu with the available features. The menus under Tax Audit are: • 44AB Audit • Form 3CD • Form 3CA • Form 3CB
  • 33. Tax Audit DashboardGateway of Tally > Audit & □ Clause No. in Form 3CDCompliance > Tax Audit □ Description of the clause under audit □ No. of unaudited Vouchers □ No. of audited Vouchers □ No. of Vouchers under observation □ No. of Vouchers requiring clarifications from client □ No. of clarified Vouchers for re-audit □ No. of altered Vouchers for re-audit CA Sandesh Mundra □ Audit Status Sandesh.mundra@smaca.in
  • 34. Cl. 16- Payment of Statutory DuesVerify employee contributions towards statutory funds(PF,ESI,etc), employee bonus and commission payments. To perform the audit , Use the Bonus, PF under this clause, the ESI Recoveries Payroll option in feature F11:Features to verify remittance in Tally.ERP 9 has to of statutory dues in be enabled and the time payroll transactions to Government have to be accounted CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 35. Cl. 17h- Amounts inadmissible u/s 40A(3)Verify and disallow payments aggregating and aboveprescribed cash limits Click F11:Features in Cash Payments screen. The Company Operations Alteration screen is displayed. Audit rule under Inadmissible Cash Payments U/s 40A (3) is defined. Define new value if required. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 36. Cl. 17h- Amounts inadmissible u/s 40A(3)Exclude ledger account(s) for which cash paymentsaggregating to Rs.20000 in a day are allowed. Click Ctrl+F9:Master button in Cash Payments screen. Select the ledger account in Select Ledger screen. Exclude the ledger account in Ledger Alteration screen from the scope of audit CA Sandesh Mundra under Rule 6DD of IT. Sandesh.mundra@smaca.in
  • 37. Cl. 17h- Amounts inadmissible u/s 40A(3)Define amount range for selecting transactions for audit ofcash payments in a day. Define new Click F10: Range F6: Amount amount display wise to range as define per values for newrequirements. the Lowest andthe Lowest ranges and Highest and Highest range of the numbers of cash payment payments. vouchers. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 38. Cl. 17h- Amounts inadmissible u/s 40A(3)Verify if the Client has issued Bearer Cheques to suppliers. Click Alt + B: Bank Summary to display ledger payments through the bank account. Specify payments made by bearer in consultation with client. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 39. Cl. 17h- Amounts inadmissible u/s 40A(3)Configure the display of details in the feature. Configure the following display details: • High/Low value vouchers • Limit for displaying cash payments • Display of low valued payments CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 40. Cl. 17h- Amounts inadmissible u/s 40A(3)Select the required Ledger Account’s cash payment for audit. Values available for Click F9:Audit to audit Audit Status Transactions. are: • the Audit In Unknown Details • Allowed screen: • Disallowed • SelectClarification Need required • status Observation Under under Audit Status • Enter the appropriate value under Amount • Enter remarks under CA Sandesh Mundra Audit Note. Sandesh.mundra@smaca.in
  • 41. Printed Annexures to Form 3CD Clause 17(h): Click Alt+P in Amounts Inadmissible under u/s 40A(3): CA Sandesh Mundra Sandesh.mundra@smaca.in Contd…
  • 42. Cl. 18- Payments to Specified PersonsVerify and disallow expenses/payments made to specifiedpersons if found to be excessive/unreasonable You can Payments The Payments to Use the alternatively Configure the ledgerto display configure the ledger through F12: details under Other accounts inPersons Specified Related accounts as Specified Configure. details to audit featuredisplay after Information in Party Configuration Ledger party screen as per (b) Persons Alteration -Sec 40A (2) related through excessive and ledger screen. underpayments creation configuration. unreasonable Masters discussions with the menu. -Sec made40A (2) (b) Client.to specified Click F12: Configure. persons. Select Yes against Click F9:Update toUse Other Information configure. Click Ctrl+F9: Master for Ledger Accounts. and select the appropriate ledger accounts in consultation with the Client from the Select Item screen. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 43. Cl. 18- Payments to Specified PersonsAuditing Payments to Specified Persons. Values are available for Select required ledger Audit Status. vouchers for audit. • Unknown Click F9 Clarification • Need : Audit to audit. to be Reported • Not • To be Reported • Under Observation Select required status under Audit Status. Enter values under Amount, Nature of Payment. Record appropriate remarks under Audit CA Sandesh Mundra Note. Sandesh.mundra@smaca.in
  • 44. Printed Annexures to Form 3CD Clause 18 : Click Alt+P in Payments to Specified Persons u/s 40A(2)(b) CA Sandesh Mundra Sandesh.mundra@smaca.in Contd…
  • 45. Cl. 24(b)- Loans / Deposits Repaid-Sec 269TVerify repayments of Loans and Deposits aggregating to andexceeding prescribed cash limits Clickthe 24(b) – to Use F4:Group Select any Group for select a/Group. Loans Deposits inclusion by pressing Repaid feature to Spacebar. find payments (loans & deposits) made by Click Ctrl + cash aggregating to A:Change to include and exceeding the selected Group. prescribed limits. Press Ctrl+Q : Quit Click F9:Master to to return to Loans configure the and Deposits inclusion of a ledger Repaid screen. account under the clause. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 46. Cl. 24(b)- Loans / Deposits Repaid-Sec 269TConfigure the display of details in the report. Click F12:Configure to define the display of details the Loans and Deposits Repaid screen. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 47. Cl. 24(b)- Loans / Deposits Repaid-Sec 269TAudit transactions of Loans / Deposits Repaid – Sec 269T. Select status under required ledger vouchers for audit. Audit Status. Enter value under Amount. Audit to Click F9 : audit. Record appropriate remarks under Audit Note. are large If there number of transactions, Audit Status Values available are: F12: use the Alt + Range to filter the • Unknown • Needof ledger display Clarification amounts greater than • Not a Loan Rs.20000. • Repaid by Cash • Repaid by Cheque/DD CA Sandesh Mundra • Under Observation Sandesh.mundra@smaca.in
  • 48. Printed Annexures to Form 3CD Clause 24(b): Click Alt+P in Loans & Deposits Repaid - u/s 269T CA Sandesh Mundra Sandesh.mundra@smaca.in Contd…
  • 49. Cl. 27- Tax Deducted at SourceVerify remittance of taxes deducted at source have been made withintime to the Government Use thethe Tax To use Tax Click Alt+F4:Party to display Party Deducted at Summary details. Source feature to feature, find whether tax enable the TDS Click Alt+F5:NOP to deducted Statutory option in at source display the Nature of has been Summary Payment remitted & Taxation under within time to the attracting TDS. in F11:Features Govt. Tally.ERP 9 and account the TDS Note: Verify detailsof NOP-Nature under: related transactions. Payments. Examine any particular • Deduction Details detail (e.g. Deducted • Payment Details on Time) in the TDS CA Sandesh Mundra Summary screen. Sandesh.mundra@smaca.in
  • 50. Cl. 27- Tax Deducted at SourceDisplay the TDS expenses closing balance with the closing balancesof other expenses (non-TDS).expenses. Compare TDS Verify non-TDS expenses with non to see if TDShas to be in the tax expenses TDS Summary deducted at source screen. for them. Click F5: Expenses Analysis to generate the analysis report. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 51. Cl. 27- Tax Deducted at SourceAudit transactions of Tax Deducted at Source. Values required ledger Select for Audit vouchers for audit. Status available are: Click F9 : Audit to • Unknown audit. • Audited • Need Clarification Select required status • Under Observation under Audit Status. Record appropriate remarks under Audit Note. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 52. Printed Annexures to Form 3CD Clause 27: Click Alt+P in TDS Summary CA Sandesh Mundra Sandesh.mundra@smaca.in Contd…
  • 53. Forms 3CD ReportThe Form 3CD report after generation
  • 54. Forms 3CA & 3CB Form 3CA-This report is prepared when the accounts of the business/profession have been audited under any other law. Refer clause (a) of Rule 6G Form 3CB-This report is prepared in the case of a person who carries on business or profession, but not being a person referred to in clause (a) of Rule 6G.
  • 55. Multilocational Connectivity
  • 56. ERP – Can we say everything is proper by defaultImplementation• Customised vs Ready• Bunch of tables• Mapping of Auto GL• Mapping of Auto Entries• Variance ManagementAudit Methodology• Sample verification for System Assurance• Check the first transactions in the sequence• T Format vs Open Entries• Control by Reports – System and Customised CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 57. Part – I TB in SAPInvolvement of Non Accounting PersonnelMost entries passed by Department other than Accounts CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 58. • Lets see a Trial Balance from SAP CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 59. SAP V/S Non SAP- Non SAP : Purchase GL’s available- SAP System: Consumption GL’s Variance GL’s Revaluation GL’s- Purchase is a derived figure Purchase = Closing Inv +Consumption – Opening Inv CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 60. Material Movements• 311 – Transfer from Stores location to PP location.• 261 – Consumption by PP.• 101 – Receipt• 321 – Quality Check• 601 – For Sale• 531 - Scrap CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 61. CO module / Valuation of InventoryThe Raw material is booked at actual cost and valued at FIFO method orweighted average method. SFG & FG are valued at Standard Cost basis.Determination of Standard CostStandard Cost of SFG & FG is determined by system itself.Periodic standard cost run has to be made in the system. The systemcalculates std cost on the basis of BOM & moving average price of RM.Bill of MaterialStages: Preparation of BOM is dependent on stages to be kept in system.You can have stock of SFG stage wise.Material Code: Material need to be created in Material Master.All material whether RM, Consumable, SFG, FG are given separate IDnumber.Series need to kept for proper understanding. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 62. Period End Activities- Knocking up of Customer. (F-32).- Knocking up of Vendors. (F-44).- In case you have more than 1 plant, you can have TB plant wise. You can see/verify all the above entries Plant wise. Certain related activities that must be done before period end so as to have proper FS- WIP Run KKAO- Variance Run KKS1- Settlement of Variance CO88- Closing of Production Orders COHV- Std Cost CK40N- Knocking up of Customer.- Knocking up of Vendors.- Closing of PP module FI should be closed when FS for a period is prepared. CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 63. CAAT Tools• Masters – Vendor Masters • Vendors with Same PAN No.s • Vendors with same addresses • Duplicate Names• Transactions – Purchases • Rate Variance among various suppliers • Time lag between Purchase order and GRN • Number of suppliers for each item • Comparison of Freight Cost from different suppliers CA Sandesh Mundra Sandesh.mundra@smaca.in
  • 64. • CA Subodh Kedia• CA Vishal Langalia• CA Inderpal Singh• Dr Kalpesh Parikh• Google.com CA Sandesh Mundra Sandesh.mundra@smaca.in