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- Nature of duties of a person who is expected to have committed fraud.
- Examine the line of responsibility among the various members of the staff.
- Income received from different sources should be scrutinized.
- Carbon copies of receipts marked duplicate should be scrutinized.
- Examining the record of the small or negligible sources of income such as sales of scrap for the sale of waste paper.
- Review of recoveries from customers and secondary parties along with deductions on account of cash discount.
- Examine the receipts are serially numbered and all receipts have been accounted for.
- In case of canceled receipts, its original copy should be examined and verified.
- Inquiries should be made for an unreasonable cash discount.
- Ensure that all payments are properly authorized by the competent authority.
- Acknowledgment by parties for payments has to be carefully scrutinized and extra care is required where a figure appears to have been erased or altered on such acknowledgment.
- Payment by bearer cheques required careful examination.
- Payments as regard wages should be examined for possible over-saling of wage sheets and entries regarding dummy workmen.
- Payment for goods purchased should be reviewed so as to confirm that no payment has been made in respect of supplies that have not been received.
- Any amount paid to partners/directors should be specifically enquired due to the possibility of manipulations therein.
- Any outgo as regards salaries and wages from petty cash books should be followed up and the petty cash book itself should be watched and totaled.
- Trace the entries in the order book with the corresponding record in the sales day book.
- Examine customer accounts to ensure that they have been properly debited at the appropriate amount.
- The amounts are written off as bad that should be carefully examined.
- Any unusual discount given to them should be thoroughly enquired into and written representation should be obtained from the appropriate authority in this connection.
- Attention should be given to the teeming and lading frauds in such accounts.
- Balance confirmation from customers should be obtained.
- The Bought journal should be vouched by reference to the goods inward book.
- The amount has been correctly credited in respect of goods duly received or not.
- Request the supplier to furnish statements of their accounts to find out whether or not any balance is outstanding or due.
- Confirm that allowances and rebates given by them are correctly adjusted.
- Stock defalcation
- Physically check the quantities in stock and those shown by the stock book.
- Cross-checking of good inward and outward registers along with the purchase and sales day book.
- Use of expert advice wherever required.