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Auditing aDepartment Store

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Pre-Audit Research

Check internal checkand control

Take notes of averagesales turnover.

Analyse previous yearspolicies.

Check for anydiscrepancies incompany policies.

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Contract Review

Make a list of contractsentered into with thirdparties.

 Whether ever productdealership has a validcontract andagreement.

The contract terms arenot extraordinary.

X1

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Slide 4

X1 Favourable to the org only.XCalibrator, 8/25/2009

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Contract Review

Contract requirementsare adequately definedand documented.

Are there establishedprocedures for new

product introduction / transfer?

X 2

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Slide 5

X2 Favourable to the org only.XCalibrator, 8/25/2009

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Purchases

1.Check the companiespurchase procedure

2.Check if the order was auth.By stores dept.

3.Check if purchases are being made from genuine dealers.4.Check if purchase was

required.5.Departments must submit a

roster of employees in the

department who areauthorized to purchase goodsand services using delegatedpurchasing authority.

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purchases

1.Check quotations and tenderscalled for.

2.Check delivery was in timeand in the right quantity(delivery challan)

3.Compare the proforma invoicewith actual invoice and goodsrecvd. Note the discrepanciesif any.

4.Check credit period granted,

method of payment, scale ofdiscount given.5.Warrantee period given by

creditors.

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Storage and InventoryManagement

All items received at theStore are examined and/ortested by Store personnel to

determine usable condition.

All items received at theStore are examined and/ortested by Store personnel to

determine usable condition

Are the materials issuedaccording FIFO?

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Storage and InventoryManagement

Develop procedures toensure that disposals areappropriately documentedand approved.

Check that the inventory isfrequently updated on theintranet website available

and it is secured with avalid password usernamecombination known onlyto the concerned people.

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Storage and InventoryManagement

Check the controlpacking, preservation andmarking processes to

ensure conformance tospecified requirements.

A complete inventorylisting is maintained bythe Store for itemsreceived, transferred, soldand/or disposedotherwise.

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Proceduralcompliance and

documentation

Transfer rates

Same quantity sentand received

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Inter store transfers

No intermediary

Authorization

Frequent transfers onyear end

Preference to adepartment

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Sales

Identify the variousDepartments

Sales records fordifferent departments

Sales tax provided

Valid discounts

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Sales

Bar code system

Bill verificationbefore exit

Shop lifting 

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Connections of theperson at billing counter

Merchant copy ofbills

Preferentialtreatments

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Returns, replacements and refunds

Failure analysis

Corrective actions

Status of correctiveactions

Products disposition

Separate storage