Auditing and Assurance revision question and answer

Auditing and Assurance Revision Questions and Answers

Association for Backward Communities (ABC) is one of the NGOs working in the Midwest part of the country. There seems to be confusion regarding total receipt of the NGO as what could be the probable revenue sources and how they should be vouched. The chief of the NGO is mostly on the foreign tour and the accountant of the NGO simply says „boss knows everything and he is just clerk‟. What documents you will insist to check to deal with the situation?

Answer

The receipt of income of NGO may be checked on the following lines:

i) Contribution and grants for projects and programmes: Check agreements with donors and grants letters to ensure that funds received have been accounted for. Check that all foreign contributions receipts are deposited into bank accounts and proper disclosure is made.

ii) Receipts from fund raising programmes: Verify in detail the internal control system and ascertain who are the persons responsible for collection of funds and mode of receipt.

iii) Interest and dividends: Check the interest and dividends received and receivable with investments held during the year.

iv) Miscellaneous receipts: Check sale of scrap, rental receipts etc., if any.



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