Routine Checking:
Whatever may be the size, constitution and nature of activities and transactions of a business, there are certain records and books which are common to all types of business organizations.
The checking of such common records and books which is carried on by the auditor as a matter of routine is known as routine checking in auditing. Routine checking involves normally four types of functions:
ADVERTISEMENTS:
(i) Checking of casts, sub casts, carry-forwards and other calculations in the books of original entry;
(ii) Checking of postings into the ledgers;
(iii) Checking of casts and balances of various accounts in the ledger; and
Image Source: dralanrae.files.wordpress.com
ADVERTISEMENTS:
(iv) Checking of transfer of balances from the ledger on to the trial balance.
Routine checking is, therefore, a type of simple checking but it is quite a significant part of the auditor’s duty. As a rule, this simple checking done in a routine way can reveal the clerical errors and fraud of a very ordinary nature.
The work becomes of a mechanical nature. Thus, routine checking can verify the arithmetical accuracy of the entries made in the books of accounts. It can help in checking, casting and postings and, as such, can ensure that no alterations are made in the figures after they have been checked and ticked accordingly.
Advantages:
ADVERTISEMENTS:
(i) The books of original entry can be thoroughly checked and the errors and fraud can be easily detected.
(ii) Postings (i.e., matters taken from records made in the books of original entry to the ledger) can be checked.
(iii) The checking of castings and postings done in routine checking is the very basis upon which the final results of audit depend. Hence, it helps in the checking of final accounts ultimately.
(iv) In short, it reveals the errors and fraud of a simple nature and, if done with care and caution, it helps in the verification of the arithmetical accuracy of the entries.
(v) Routine checking is a simple job which can be done easily by a person with an ordinary knowledge of accounts.
(vi) It is the simplest device for audit work.
Disadvantages :
Routine checking is practically a mechanical process and hence, it can cause monotony to those who are entrusted with this task.
Only minor cases of fraud can be detected by routine checking. Major items of fraud cannot be brought to light.
There appears to be a lot of difficulty in tracing out compensating errors and errors of principle.
Routine checking is not always considered important in the audit of a business where self-balancing system is used.