Dear Sir,
Please provide me the checklist during the checking of Cash Credit A/c. in Company. Which point we have to kept in mind while checking the Cash credit Account ?.
2 Replies
C.A. P. HAREESH KUMAR
(PRACTICE)
(375 Points)
Replied 03 February 2015
Pl confirm that you are veryfing the cash credit loan account of a client company
If so few points we can share
1) Verify the recocilliation with Bank statement - Ensure that liabity is correctly stated
2) Examine all reconcilliation items - investigate long pending items / disputed items
3) Latest Sanction / renewal letters to know the terms of sanctions - tenure -interest - penalties stock / receivable that is hypothicated - frequency of stock statement - D/P & margins
4) Call for copies of stock / receivable audit report - Inspection report etc to know whether any breach occured resulting in penalty
5) Expenses such as processing fees - Interest etc have been correctly provided on accrual basis
6) Disclosure in Balance sheet - under current liabilities -Name of the Bank , Notes on the nature of security . guarentee provided etc
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