How Would You Audit The Accounts Of A Sugar Mill?

The auditor examines the sale in cash in hand. The cash book shows the cash balance. The cash balance. The cash can be counted by auditor to see that there is no misuse of cash. The auditor can check the sales from sales ledger. The main item of sales is sugar. Moreover there may be molasses, candies, chipboard and wine. The auditor staff can verify the closing stock. The sugar management is asked to provide stock register. The audit staff may be present at the time of stock taking.

The sugar mill management can provide loan to sugar cane suppliers. These loans are adjusted against payment to cultivators for supply of sugar cane. The auditor can check the vouchers for loans and adjustment of such loans. The auditor can check totals, sub totals, cast and carry forward. It is a routine checking just to check the accuracy of books of accounts. It is necessary to see that figures are facts.

The auditor can examine the expense playable and paid to Railway Company. The sugar mill owners my have made an agreement with the railway authorities. The sugar mills have its own agriculture farm. The auditor can check the income and expense of farming activities. The cane grown and delivered to sugar mill can be verified. The verification of farm assets and liabilities is essential for an auditor.