Accounts Receivable Confirmation TemplatesFollowing on my previous post Audit: Accounts Receivable Confirmation [Application techniques], as a complement, this post contains illustrations which are some instant editable templates that you can use to perform accounts receivable confirmation during the course of accounts receivable audit. The “Accounts Receivable Checklist Template” will lead you to every steps of the confirmation process I discussed on the previous post. Although this not all inclusive, templates presented here should be enough to carry the process.

Advertisement

Here are templates available in this post:

  • Confirmation checklist.
  • Positive confirmation with statement.
  • Positive confirmation without statement.
  • Negative confirmation.
  • Subsequent payments confirmation.
  • Confirmation of selected transactions.
  • Description of confirmation worksheet.

 

ACCOUNTS RECEIVABLE CONFIRMATION CHECKLIST

…………………………………….
[Client]

…………………………………….
[Audit date]

 

Instructions: This checklist is divided into two sections, as follows:

1. General information.
2. Procedures.

If a procedure listed is not applicable, insert “N/A” in the column “Performed by” and explain why in the “Explanation” column.

General Information

1. Date confirmation sent.
                                                                             Positive          Negative
                                                                             confirmation   confirmation
First request
Second request                                                                             N/A
Third request                                                                                N/A

 

2. For positive confirmation, list the following:

                                                                            Number of        Amount of
                                                                            receivables        receivables

a. Accounts receivable
b. Confirmations sent
c. Percentage
d. Responses
e. Percentage of confirmations sent
f. Percentage of total receivables

3. For negative confirmation, list the following:
                                                                                Number of       Amount of
                                                                                receivables      receivables
a. Accounts receivable
b. Confirmations sent
c. Percentage
d. Responses
e. Percentage of confirmations sent
f. Percentage of total receivables:
                                                       [Procedure] [Performed by] [Date] [Explanation]

1. Obtain from client aged schedule   
of accounts receivable.

2. Determine that all accounts listed  
in the accounts receivable schedule
are customer accounts.

3. Check that total in accounts           
receivable is correct and compare
total with balance for accounts
receivable in general ledger.

4. Compare all or a selected sample   
of account balances in the
schedule with account balances in
the accounts receivable subsidiary
ledger.

5. Select accounts for positive           
confirmations.

6. Select accounts for negative          
confirmations.

7. Prepare schedule of accounts to   
be confirmed, listing the following:
a. Confirmation number.                   
b. Name of account.                          
c. Address of account.                      
d. Receivable balance.                       
e. Balance confirmed.                        
f. Difference.                                     
g. Explanation of difference.             

8. On a test basis, check account addresses
to source independent of
accounts receivable department, such as
a. Customer file.                               
b. Telephone book.                           

9. Mail confirmation requests in envelope
with firm return address. Include the following:
a. Customer statement.                    
b. Letter requesting confirmation.    
c. Firm postage-paid envelope.        

10. For confirmation responses,

do the following:
a. Enter balance confirmed.              
b. Require client to reconcile              

any differences.
c. Review documentation for              

reconciling items.

11. Send second requests.               

12. Send third requests.                   

13. For nonresponses of significant balances,
do the following:
a. Review subsequent cash receipts.  
b. Review customer remittance.       

14. If customer indicates it cannot confirm
balance owed, request confirmation of
a. Specified invoices.                       
b. Specified cash receipts.               

15. Nondelivery of request.             
Mail to new address.

16. Facsimile response.
a. Photocopy response.                    
b. Verify source and contents of       

response by telephone call to sender.
c. Request sender to mail original  

confirmation request.

 

 
POSITIVE CONFIRMATION WITH STATEMENT

                                                                                             [Control number]
                                                 [Client letterhead]
                                                                                             [Date]
[Name and address
of customer]

 

Gentlemen:

Our auditors, [name and address], are conducting an audit of our financial statements. Please examine the accompanying statement and either confirm its correctness or report any differences to our auditors.

Your prompt attention to this request will be appreciated. An envelope is enclosed for your reply.

Very truly yours,

…………………………………..
[Client signature and title]

 

Confirmation

The balance receivable from us of [amount] as of [date] is correct except as noted below:

 
…………………………………..
[Debtor name]

Date …………………………..

By ………………………………

 

Note: This confirmation also may be used as a second request by stamping or printing in a prominent locationSECOND REQUESTand mailing with a copy of the statement.

 

 

POSITIVE CONFIRMATION WITHOUT STATEMENT

                                                                                              [Control number]
                                             [Client letterhead]
                                                                                              [Date]

[Name and address
of customer]

 

Gentlemen:

Our auditors, [name and address], are conducting an audit of our financial statements. Please confirm to them our receivable from you of [amount] as of [date].

Your prompt attention to this request will be appreciated. An envelope is enclosed for your reply.

Very truly yours,

 

……………………………………
[Client signature and title]
Confirmation

The balance receivable from us of [amount] as of [date] is correct except as noted below:

 

………………………………………………
[Debtor name]

Date ………………………………………. 

By …………………………………………..

 
Notes: This confirmation also may be used as a second request by stamping or printing in a prominent locationSECOND REQUEST”.

 

 

NEGATIVE CONFIRMATION WITH STATEMENT, GUMMED STICKER, OR RUBBER STAMP

Auditor’s Confirmation Request

Please examine this statement. If it does not agree with your records, please report any exceptions directly to our auditors

[Auditor’s name]
[Auditor’s address]

who are conducting an audit of our financial statements. An envelope is enclosed for your reply.

 

Note: This format may be used as a gummed sticker attached to a statement or as a rubber stamp imprinted on a statement.

 

 
SUBSEQUENT PAYMENTS CONFIRMATION

                                                                                                              [Control number]
                                                           [Client letterhead]
                                                                                                              [Date]

[Name and address
of customer]

 

Gentlemen:

Our records indicate that between [date] and [date], you made payments to us of [amount].

In connection with an audit of our financial statements, please confirm the payments and their allocation listed below or report any differences to our auditors, [name and address].

Check or voucher                                           Applicable to invoices dated
[Date]    [Number]   [Amount] [Deductions]    [Before]           [After]

……..      …………      ………..     …………….      ……….             ……….

 

Your prompt attention to this request will be appreciated. An envelope is enclosed for your reply.

 

Very truly yours,
…………………………………..
[Client signature and title]

 

Confirmation

The payments and their allocation listed above agree with our records except as noted below:

 

……………………………..
[Debtor name]

Date ………………………

By ………………………….

 

 
CONFIRMATION OF SELECTED TRANSACTIONS, OPEN INVOICE SYSTEM

 

                                                                                                     [Control number]
                                                           [Client letterhead]
                                                                                                     [Date]

[Name and address
of customer]
Gentlemen:

We understand that you do not maintain an accounts payable ledger showing balances due each vendor. However, we would appreciate your assistance in providing limited confirmation of specific transactions to permit the completion of our annual audit.

Please confirm to our auditors, [name and address], that the invoices listed below were proper and were unpaid as of [date].

I  n  v  o  i  c  e                              C   u  s  t  o  m  e  r
[No.]       [Date]                              [P.O.No.] [Location]     [Amount]

…….       ……….                              ………….  ……………     ……………

 

Your prompt response will be appreciated. An envelope is enclosed for your reply.

 

Very truly yours,
…………………………………..
[Client signature and title]

 

Confirmation

The invoices listed above were properly charged to our account and were unpaid as of [date] except as noted below.

 

…………………………
[Debtor name]

Date ………………….

By ……………………..

 

 
DESCRIPTION OF CONFIRMATION WORKSHEET

Description. An accounts receivable confirmation worksheet ordinarily should include the following columns:

1. Customer name.
2. Control number.
3. Indication of second request.
4. Balance per client.
5. Amount confirmed.
6. Differences.
7. Explanation of differences.

a. Receipts in transit.
(1) Date deposited.
(2) Amount.

b. Credits issued.
(1) Date.
(2) Amount.

c. Shipments in transit.
(1) Date shipped.
(2) Amount.

d. Other.

 

Accounts receivable confirmation templates presented in this post are by no meant perfect, you can always modify the form, wordings and design to best suit your circumtances and make it look more professional in the same time.