4. EXPENDITURE
• Expenditure in the context of audit in
educational institutions refers to the money
spent or expenses incurred by the
institution during a specific period, such
as a fiscal year.
• It includes all the financial transactions
and payments made by the educational
institution for various purposes, such as
salaries, supplies, equipment, maintenance,
utilities, student services, and other
operational costs.
• During an audit, the expenditure is
carefully examined and reviewed to ensure
that it is properly documented, authorized,
and in accordance with applicable laws,
regulations, and financial policies. The
purpose of auditing expenditure in
educational institutions is to ensure
transparency, accountability, and the proper
use of funds.
5. Work of Auditor
1
2
3 4
5
6
He should vouch the amount of
salaries paid to the staff with the
salary register, counterfoils of the
cheques book, cash book and the
bank pass book.
He should see whether any
increment given to an employee
has been duly sanctioned by the
proper authority, say, the
managing committee.
He should see that, while
making the payment of staff
salaries, income-tax has been
deducted at source and duly
deposited with the income-tax
department.
The establishment expenses must
be careful vouched with relevant
vouchers and the entries in the
cash book.
The payment of scholarship
should be verified with the
receipts from students and the
scholarship register
He should vouch the items of capital
expenditure and see that are
sanctioned by proper authority, i.e.,
the managing committee.
EXPENDITURE
6. MISCELLANEOUS
In educational institution audits,
a "Miscellaneous" category may
include expenses such as small
purchases, minor repairs,
incidental costs, or miscellaneous
income that cannot be allocated to
specific accounts or categories.
These transactions are typically
grouped together under the
Miscellaneous category for the
purpose of financial reporting and
auditing.
7. Miscellaneous
01
He should ascertain
whether all purchases are
properly authorized by a
responsible official
02
STEP
He should ensure whether
adequate depreciation has
been provided on fixed
assets like Furniture,
Equipment's
03
He should verify the stocks of
stationery, sports materials,
equipment's etc. as far as
possible. He should see that
proper records have been
maintained for these items
04
He should see that proper
distinction has been made
between capital and revenue
receipts and capital and
revenue expenditure.
05
He should see that the assets
and liabilities are properly
exhibited in the balance sheet
06
He should verify the
cash and bank balances
in the usual manner
07
He should see that
investments representing
prize endowment funds are
kept separately and are not
mixed up with ordinary
investments.
8. Conclusion
It is the duty of the auditor to
take proper steps to verify the
assets and liabilities stated in
the balance sheet. This fact is
supported by many case laws. For
instance, LONDON OIL STORAGE
COMPANY VS SEEAR, HASLUCK AND
COMPANY
