VERIFICATION

VALUATION
1.MEANING

* IMPORTANCE
a) no change in method
b) method of valuation
c) foreign exchange
d) correct computation
e) Revaluation
CASH
VERIFICATION

1.PHYSICAL VERIFICATION
2.TORN CURRENCY
3.LARGE BALANCE
Stock verification
*meaning-
1.verification-
a) Verify existence
b) Possession
c) Cut off transactions
d) Subject to charge or lien
e) Audit report under
companies act
f) Duty prescribed by ICAI
2.Procedure for stock taking-

a) Written instructions
b) No stock movement
c) Stock sheets
d) Up to date stock books
e) Reconciliation
f) Stock of outsiders
*Verification of fixed assets:
A) Examination of records
B) repairs.
*Physical verification
A) frequency.
B) Method of verification.
C) Reconciliation.
*Valuation and disclosure
A) Lumsome price.
B) Joint assets.
Verification of liability

1. Introduction
2. Scope
3. Importance
4. Features
5. Aim
Verification of capital
Authorized capital
1.Closing balance
2.Changes during year
* Minutes
* ROC forms
Issued capital
1.Minutes
2.Offer documents
3.Return with ROC
Issue of shares for cash:
While vouching the issue of shares for
cash
1.Application forms
2.Amount received
3.Allotment of shares
4.Journal entries
Issue of shares for consideration other
than cash:
1.Cases 2.Agreement
3.Prospectus 4.Minute book
Issue of share at a premium
1.Law
2.Accounting
3.Use of premium
4.Return of allotment
Issue of share at a discount
1.Provision
2.Auditors duty
Bank verification
Introduction: While verifying bank, the
auditor should consider the guidance note on audit
of cash and bank balances issued by the ICAI.

• Bank balance may constitute total asset of an entity.

• Faces risk of misappropriation and fraud.

• BRS help the auditor to verify- recorded bank

balance exists, recorded bank balance belongs to the
entity, and there are no unrecorded bank balance.
While verifying bank
While verifying bank-

 *Examine – auditor should examine the BRS

prepared as on last day of year or on other dates
also.
 *Issued – examine whether cheque issued but not
presented and cheque deposited but not credited
in the bank statement have been duly done in
subsequent period.
 *Delivered – if the cheques issued before the year
end have been not presented within a reasonable
period, they may not have been delivered to the
parties and need to be reversed.
Conclusion
Auditor should confirm that all the
asset of the concern physically exist on
the date of balance sheet.
To find out the proper value of asset
or liabilities for recording in the books
and disclosure in final a/c’s hence
valuation is needed.
Thank you!!!