Examine sales invoices for consignment sales and other shipments for which control has not been transferred.

Test of Details of Balances,Test of Control, or Substantive Test of Transactions Audit Procedure
1. Confirm accounts receivable ending balances and sales terms, such as right of return
and consignment arrangements.
2. Review sales returns after the balance sheet date to determine whether any are ap-
plicable to the current year.
3. Compare dates on shipping documents with the sales journal throughout the year.
4. Perform alternative procedures for nonresponses to confirmations.
5. Examine sales transactions for related-party or employee sales recorded as regular sales.
6. Examine sales invoices for consignment sales and other shipments for which control
has not been transferred.
7. Trace a sample of accounts from the accounts receivable master file to the aged trial
balance.
8. Trace recorded sales transactions to shipping documents to determine whether a
document exists.
9. Trace the balance of accounts receivable from related parties to proper disclosure in
the footnotes to the financial statements.
10. Trace a sample of shipping documents to related sales invoice entries in the sales journal.
11. Compare amounts and dates on the aged trial balance with the accounts receivable master file.
12. Trace from the sales journal to the accounts receivable master file to make sure the
information is the same.
13. Inquire of management whether there are notes from related parties included with
trade receivables.
a. Identify which procedures are tests of details of balances, which are tests of controls,
and which are substantive tests of transactions.
b. For each balance-related audit objective, identify which test of details of balances and test of controls or substantive test of transactions partially satisfy the balance-related objective.

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