Please tell me how will I check if the advances given to suppliers, as shown by the books are authe…
Please tell me how will I check if the advances given to suppliers, as shown by the books are authentic?
Chiranjibi Mar. 09, 2018
In case the entity has given out advances to the suppliers, you can consider this checklist to verify whether they are true and fair or not.
- Obtain schedule of debit balances in trade payables’ account and pay particular attention to the age of the balances. Also scrutinise the Bought ledger.
- Enquiry should be made for long unadjusted outstandings and check as to whether any of them would require provisioning.
- Examine that the advances have not been shown as deposits in balance sheet as per Section 143(1) of the Companies Act, 2013.
- Confirmation of balances should be obtained and reconciliation be done in case of any discrepancies.
