Asked by: Loree Novellasbusiness and finance debt factoring and invoice discounting
How do bank confirmations differ from positive confirmations of accounts receivable?
Last Updated: 29th June, 2021
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Also question is, what is an accounts receivable confirmation?
The accounts receivable confirmation. This is a letter signed by a company officer (but mailed by the auditor) to customers selected by the auditors from the company's accounts receivable aging report.
Similarly, how and why might auditors use of accounts payable confirmations differ from that of accounts receivable confirmations? The auditors rarely use the accounts payable confirmation rather than the accounts receivable confirmations. This is because the documents such as vendor invoices, monthly vendor statements, and payment reports that are re-examined are issued by the external parties.
Keeping this in consideration, what is the difference between negative and positive confirmations?
A negative confirmation is a document issued by an auditor to the customers of a client company. A positive confirmation is one in which the customer is required to send back a document, either confirming or disputing the account information sent to it by the auditor.
What are bank confirmations?
Bank confirmation is the audit procedure that perform by auditor to test the existence, accuracy and the ownership of banks account and bank balance of entity. This procedure is normally performed during the interim audit rather than at the completion stage.