CRUZ, Jeff Lawrence NICOLAS, Janila May

LAOYAN, Angela Fae PANOYO, Daisylyn

LASDACAN, Claudine TADEO, Rizza Mae
Form AP 70

Index Reference

Audit Program for Revenues and Expenses

Legal Company Name Client:

Balance Sheet Date:

Instructions: The auditor should refer to the audit planning documentation to gain
an understanding of the financial reporting system and the planned extent of testing
for revenues and expenses. Modification to the auditing procedures listed below may
be necessary in order to achieve the audit objectives.
All audit work should be documented in attached working papers, with appropriate
references noted in the right column below.

Audit Objectives Financial Statement

Assertions

Billings are for the correct amount; revenues are Existence or occurrence
recorded correctly as to account, amount, and period; Completeness
and uncollectible amounts, sales returns, and Rights and obligations
allowances are adequately provided for. Valuation or allocation

All revenues earned during the year have been Existence or occurrence
recorded; and recorded revenues represent valid Completeness
transactions applicable to goods shipped or services
rendered.

Expenses and costs of products and services are valid, Existence or occurrence
complete, and recorded correctly as to account, Completeness
amount, and period. Rights and obligations
Valuation or allocation
Recorded expenses include costs which are properly Existence or occurrence
allocable to the year and are properly matched with Completeness
revenues. Valuation or allocation

Revenues, costs of revenues, income, and expenses are Presentation and disclosure
properly classified in the statement of operations, and
adequate disclosures are made in accordance with IAS,
CRUZ, Jeff Lawrence NICOLAS, Janila May
LAOYAN, Angela Fae PANOYO, Daisylyn
LASDACAN, Claudine TADEO, Rizza Mae
including: extraordinary items, discontinued
operations, unusual or infrequent items.

Performed Workpaper
By Reference
1. Perform the following analytical procedures for
revenues and expenses, and investigate any significant
fluctuations or deviations from the expected balances:

a. Compare monthly sales by product line or

geographic area for the current year with monthly
sales for the prior year and the first few months
subsequent to year end.

b. Compare monthly sales returns and allowances and

credit memos for the current year with those of the
prior year and the first few months subsequent to
year end.

c. Compare gross margins by product line or

geographic area for the current year with the prior
year and budget.

d. Compare other operating relationships (e.g., both

sales and cost of sales to units shipped) for the
current year with the prior year.

e. Compare the current year’s composition of total

product cost (i.e., materials, labor, and overhead)
with the prior year’s.

f. Compare the relationships of current-year payroll

expense to cost of sales and sales with the prior
year’s.

g. Compute payroll tax expense as a percentage of

total wages and salaries and compare with the prior
year’s.

h. Compare current year other income account

balances with the prior year’s.

i. Compare current year other income account

balances with budgeted amounts.
 Performed Workpaper
By Reference
j. Compare current year expense account balances
with the prior year’s.
k. Compare current year expense account balances
with budgeted amounts.
l. Calculate individual expense categories as a
percentage of total expenses for the current year
and compare with the prior year’s percentages.
2. Test sales for overstatement by selecting several sales
recorded in the sales journal, for each month, and
compare amounts and other information to shipping
documents.
3. Test sales for understatement by selecting several
shipping documents, for each month, and compare
information to sales invoices and determine if the sales
were properly recorded.
4. For expense accounts that are material or high risk,
select individual large disbursements or accruals and
examine the supporting documentation (e.g., vendor
invoice, payment orders, etc.); consider examining the
propriety of the balances in the following accounts:

a. Rent

b. Repairs and maintenance

c. Legal and professional fees

d. Travel and entertainment expenses

e. Salaries

f. Social insurance

g. Miscellaneous expenses

h. Other expense categories selected by the auditor

(specify accounts below):

5. Scan the general ledger and other accounting records

for large and unusual income and expense transactions
and review supporting documentation.

6. Ascertain that revenues, costs of revenues, income,

 Performed Workpaper
By Reference
and expenses are properly classified in the statement
of operations and adequate disclosures are made in
accordance with IAS.

Based on the procedures performed and the results obtained, it is my opinion that the
objectives listed in this audit program have been achieved.

Performed by Date

Reviewed and approved by Date

Conclusions:

Comments: