While engaged in an audit procedure, alternative procedures are sometimes necessary. While verifying the existence and ability to be collected on certain assertions, the auditor will seek positive confirmation from the debtors. If this is not received, the auditor is required to perform these alternative procedures to be sure.
These procedures help confirm the noted Accounts Receivables are being properly stated by the entity. If they are not provided by the debtor, they are able to be found in the alternative ways.
In a service industry, a duplicate of the sales invoices provided would suffice. This would confirm the receivables exist and are correct as the services income is documented elsewhere. In a manufacturing industry, confirmation from a client would be an alternative procedure. Receiving verification that the transaction did occur, and seeing any cash reciept or invoice of it would qualify.
Question.
When referring to certain assertions, can you please elaborate on which assertions you believe are tested when performing a test of details over accounts receivable?