Client Name: Ram & Shyam Chawalwaala Limited FY End 31/Mar/22

Business Cycle: Document No

<Objective>
To obtain an understanding of the entity's Revenue cycle processes including the internal control activities in place that are relevant to the audit. In this working paper, also we Do visit this
www.catusharmakkar.com
will evaluate the adequacy of the control designs
website

<Work Done>
Date of Discussion 10/03/2022
Venue Punjab
Badi Firm representative Mr. Chetan
Client Representatives / DesignaFinance manager, sales manager, sales executive
Assertions

Whether is it DO YOU
TYPE OF CONTROL
operational ENTITY LEVEL WHETHER PLAN TO
(Manual(M) / FINANCIAL DESCRIPTION OF
CONTROL (C ) control/ Department and CONTROL (ELC ) / Completene CUT CONTROL ACTIVITY DESIGN DEFICIENCY? TEST
PROCESS(ES) Control description Control/Process Owner Computer FREQUENCY STATEMENT Occurrence P/D Accuracy WALK-THROUGH
/ PROCESS (P) financial Designation ACTIVITY LEVEL ss OFF MEETS CONTOL (Y / N) OPERATING
Dependent(CD) / AREA(S) TEST
reporting CONTROL (ALC) OBJECTIVE EFFECTIVEN
Automated(A))
control ESS?

A.PO PO - Exports & Domestic Control Financial Sales head (Sales Mr. Name (Sales head) ALC Manual/Computer Regular Revenue a r r r a Yes N Yes 1.
Sales Team obtains approval of sales head on each Export customer department) dependent Export &
& domestic orders Domestic :Approved
Export and domestic
Customer Order

B. Creation of sales order Sales team creates the sales order in the system. Quantity is updated Control Financial Sales manager & Finance Mr Name (Sales manager) & ALC Computer Dependent Regular Revenue a r r r a Yes N Yes 2.
by the sales manager and price is updated by the finance manager. manager Mr Name (Finance Export &
Quantity and price cannot be edited without the approval of the sales manager) Domestic :Updation
head of
price and quantity by
authorised person
C.Customer Master 1.Sale team communicate the details of new party to finance team Control Financial IT team & Finance Mr. Name (IT Team) & ALC Computer Dependent Regular Accounts Receivable r r r r r Yes N Yes 3.
(Let say finance executive) executive Mr Name (Finance excutive) Export &
2.Finance team after verification of details of new party, will approve Domestic :Approval
and send form to IT Team of customer code
3. IT team (HO) creates new customer code in accounting software creation
along with specified credit limit

D. Invoicing In case of export, Logistics head creates Pre-shipment invoice in Control Financial Logistics head & CEO Mr Name (Logistics head) & ALC Manual Regular Revenue a a r r a Yes N Yes 4.
accounting software and forward the same to CEO for approval. CEO Approval of Invoice

E. Delivery and Dispatch -Logistics team (let say logistics executive) initate the process Control Financial Logistics executive Mr. Name (Logistics ALC Manual Ongoing Revenue a r r r a Yes N Yes 5.
dispatching the material from the plant Dharam kaata team executive) Bill of supply
-Dharam kaata Team creates Bill of supply in accounting software Sales executive Mr. Name (Dharam kaata authorised
after proper weighment team)
- Bill of supply will be authorised by sales executive, logistics Mr. Name (Sales executive)
department and dharam kaata department
- In case of domestic supply, the revenue would be recognised here
only however in case of export only inventory movement would be
recorded here

F. Accounts receivables: On month end Mr. Accounts exectutive extracts the AR ageing report Control Financial Finance manager Mr. Name (Finance ALC Manual Monthly Accounts Receivable a a r r a Yes N Yes 6.
and forwards to Mr Finance manager for review. manager) Review of accounts
receivbales report
g. Revenue recognition As per the Company Policy revenue is recognized as follows: Process Financial Logistics executive Mr. Name (Logistics ALC Manual/Computer Ongoing Revenue a a r r a NA N NA NA
-Revenue would be recognised on the basis of bill of lading in case of Sales executive executive ) dependent
export sales after taking the sheet from logistics team (let say Mr. Name (Sales executive)
logistics executive) by sales executive.
-Revenue would be recognised as and when the material goes out
from the factory in case of domestic sales.
The exchange rate is already embedded in accounting software at
the prevalent RBI rate.