Substantive Procedures

[zeal]

Hi Friends,

There has been lots of talk regarding use of Subsantive Procedures. Please anyone explain in full with example for:

a) Test of details of transactions

b) Test of balances.

[Hamdy Hafez]

ok at first you must take a fast forward regarding some points
Test of controls are tests performed which help to see the effectiveness of internal control system i.e. how are they implemented and if the strategies implemented are running effectively.

Substantive testing has a component known as test of details. It really means checking details, the underlying accounts in financial statements and everything which would be necessary to get enough documented audit evidence on which to form an appropriate audit opinion.
How would you differentiate between test of detail and test of control?
Test of control as I said above relate only to the testing of internal controls while test of detail test every, and everything from procurement policy to the marketing dept and accounts underlying the financial statements.

in the next post , it will be clear, wait for it.

[zeal]

Hi Ham

Thanks for reply. Your answer really revolved around definitions.

I would appreciate if you can add some words that clearify both of the Test of details of transaction and balances. with one single example.

[Hamdy Hafez]

Hi Ham

Thanks for reply. Your answer really revolved around definitions.

I would appreciate if you can add some words that clearify both of the Test of details of transaction and balances. with one single example.

Dear Zeal
excuse me you have missed the remaining parts of answers regarding your first question, so please visit this link & wait again for more clarification
http://getthroughguides.co.uk/forum/showthread.php?t=982