Author: G N Ramaswami, Partner, Assurance
The Guidance note on Audit of Revenue was issued in May 1997 outlining the requirements for an auditor to be able to verify an entities revenue. The Guidance Note deals with the audit of the different types of revenues including sale of goods, rendering of services, use by others of entity resources yielding interests, royalties and dividends. It highlights the need for an auditor to obtain sufficient appropriate audit evidence to corroborate and verify data. GN Ramaswami has also outlined the various aspects of the Internal Control Evaluation in regards to Audit of Revenue as well as going into detail about the examination of records and the analytical review procedure required for verification.
Also outlined in this article is the need for the appropriate and thorough documentation regarding the audit of revenue. Revenue is directly related to the profits of an entity therefore, the audit process has to be reliable and complete. However, it would be wise to note that an auditor has to be in line with the time so create the most relevant audits. Read the full article for the synopsis of the Guidance Note on Audit of Revenue, published by Taxsutra.
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