Revision actions

Audit activities are all activities of the auditor in order to compare an actual state with a target state and to obtain a judgment on the matter to be examined. Revision actions can be divided into formal and material revision actions according to the form and content of the audit object.
Formal revision actions are aimed at the external correctness including the arithmetical correctness of the facts to be checked. In particular, the external correctness of the accounting must be given in three respects:
- Proper recording of all business transactions in the receipts, books and other documents.

- Correct processing of the figures at all levels of accounting.

- Observance of the formal regulatory principles specified by statutory and operational regulations (laws, ordinances as well as internal guidelines and orders) and by the principles of proper bookkeeping.

Formal audits include the following formal reviews:

Voting check

During the reconciliation checks, data is compared with one another that has been documented in various documents, but must necessarily match due to existing systematic relationships. The completeness and the recording of the data are checked. A distinction must be made between individual, partial and overall or global votes.

Examples: Matching the balance of a personal account with the corresponding item in the balance list (individual reconciliation); Reconciliation of fixed assets according to the asset index with the general ledger account (partial reconciliation); Coordination of the entire booking material according to the land registers with the general ledger and finally with the annual financial statements (overall coordination).

Transmission check

The transfer check compares the transfer of the same data from one document to another. The conformity of certain data is checked. The transfer check supplements the reconciliation check.

Wichtigstes Beispiel für eine Übertragungsprüfung ist der Grundsatz der Bilanzkontinuität. Nach § 252 Abs. 1 Nr. 1 HGB müssen die Wertansätze in der Eröffnungsbilanz des Geschäftsjahrs mit denen in der Closing balance des vorhergehenden Geschäftsjahrs übereinstimmen.

Mathematical test

The mathematical test determines the correctness (addition, subtraction, multiplication, division) of numerical material.
Examples: Checking the arithmetical correctness of sums and balances in land registers, main books as well as in auxiliary and sub-books; Check the additions and multiplications in inventory lists.

Document check

Bei der Belegprüfung wird die Richtigkeit der erstmaligen Erfassung von Daten festgestellt. Zu unterscheiden sind die formelle und materielle Prüfung eines Beleges einerseits und der Vergleich des Beleginhalts mit den entsprechenden Eintragungen in den Büchern andererseits. Bei der Belegprüfung sind formelle Ordnungskriterien (chronologische Erfassung, Verständlichkeit des Textes, Vollständigkeit Account assignment, Unterschriften etc.) zu unterscheiden. Der Vergleich des Beleginhalts mit den entsprechenden Eintragungen in den Büchern kann als Prüfung der Verbuchung bezeichnet werden. Die Belegprüfung ist i.d.R. eine Kombination von Abstimmungs-, Übertragungs- und rechnerischer Prüfung.

Examples: Checking the correct recording of data in (internal) material withdrawal slips and the further processing of this data in accounting; Checking the correctness of data on (external) incoming invoices and their processing in accounting.

Material revision actions are aimed at the correctness of the content and the material justification of the facts to be examined. The main focus of the substantive revision activities is the revision of valuation processes according to legal, statutory or general economic aspects. Typical material auditing activities are therefore the analysis of the asset, financial and earnings situation and the revision of the valuation of certain facts (e.g. fixed and current assets).

The formal and material audits are not, however, acts of revision that lead to a judgment. Rather, the distinction relates to different aspects of a revision object, namely form and content. Accordingly, not one, but two revision judgments are sought: One revision judgment on the form, another on the content. However, the separation of formal and material auditing activities is useful and important for auditing practice.

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