The activities of any enterprise must be monitored in order to prevent any errors and distortions in the company's statements, because the results of such errors can be incorrect decisions of users of financial statements, and, as a result, such errors and distortions can lead to a multiple increase in losses. Since the calculations of the company with counterparties are an essential part of the company’s activities, they conduct an audit of settlement operations.
To begin, let's figure out with whom and for what the company can pay. Contractors of the company can be divided into two global groups: debtors and creditors. Debtors are all those who owe something to the company, be it money, goods, services or any other values, and creditors are all those who owe something to the company. Audit of settlement operations involves checking settlements with both one and the other.
What procedures does this type of check involve ? The audit of settlement operations involves the following activities.
First of all, it is necessary to establish the reality of the obligations of the company to someone, or debtors to the company. Various procedures are provided for this, such as verification of primary documents, bank statements, and in special cases, sending special letters to counterparties. So, if an audit of deposit operations is carried out , the auditor can send a letter to the bank in which the deposit is stored asking for clarification of the deposit amount, the amount of interest payments and their frequency.
Next, you need to evaluate the correctness of the display in accounting documents of all aspects of settlement transactions. This is especially important if objects that are not owned by the company participate in the operations, that is, if an audit of rental operations is carried out. In this case, it is important to note whether leased objects, which, in fact, do not belong to it, are recorded on the balance sheet of the enterprise . It is also important to verify that all rental payments are correctly displayed in the documents, including making sure that they are correctly transferred to the cost of production, but only if this object takes part in the production process. In addition, when conducting an audit of settlement transactions on leases, it must be remembered that depreciation is accrued by the lessor and reduces its gross income, therefore, depreciation on objects leased is not necessary. In case of violation of this rule, it is necessary to carry out corrective operations, however, this is fraught with subsequent issues from the tax and other inspection bodies.
Audit of settlement operations usually takes quite a long time compared to other types of checks. The reason for this is the variety and the large number of settlements that are carried out both with customers and with suppliers. Moreover, after conducting an audit of settlement operations, it often becomes necessary to conduct other types of checks, say, regarding stocks or fixed assets. This is due to the fact that if there were violations in operations with suppliers or buyers of the enterprise, it is logical to assume that not only the financial side of the issue was affected, but there are also inconsistencies in the real availability of certain objects in the enterprise.
That is why the audit of settlement operations is considered one of the most important types of checks of the financial condition of the enterprise. High-quality conduct of this type of audit is the key to the financial health of the enterprise and its lack of problems with inspection bodies in future periods.