sales returns risks and controls

approval of sales return prior to issuing credit memo
invalid customers, invalid returns, unapproved pricing
separation of responsibility for authorization of customer returns from custody of inventory
fictitious customers
SOC of inventory from accounts receivable record keeping
invalid returns or omitted transactions
preparation of receiving reports and credit memos on pre-numbered docs
omitted transactions
preparation of receiving report and receiving log only when products have actually been received
invalid trans, omitted trans or timing issues
preparation of credit memos and credit memo journal only when products have been received
invalid trans, omitted trans or timing issues
preparation of customer act statements
wrong customer or incorrect amts
matching of info on related documents before issuing credit
invalid trans, incorrect amts, timing and duplicates
comparison of receiving log with credit memo listing and credit memos
omitted transactions, incorrect amts, wrong customers
Categories: Sales