Racm P2P
Racm P2P
Procurement To Pay
Audit Period : FY 2021/22
Division : Sports
Sr. No Process Name Sub Process Control Objective Risk Description Test Plan
Vendor Creation and Management
To ensure that Vendor details are entered in system after due Unapproved Vendors entered in Vendor master list which may lead to unauthorised 1- On the Basis of Sample, Ascertain only authorized and approved vendor created in the system
1 Vendor Creation
approvals from management and illegid transactions. 2- Review vendor master data to identify any multiple/duplicate vendor codes.
1- Ascertain whether a vendor database/ master exist, containing details of vendors as well as the
specific goods/ services to be sourced from each of the vendors.
To ensure that Vendor data is properly maintained and updated
2 Vendor data management Changes in details of suppliers data may be made without authorization 2- Check that only the specified goods/ services can be sourced from individual vendors.
on a regularly basis
3- Review only authorized person made changes in the vendor master data after due approval
(Including deletion of vendor)
3 Vendor Master Data To ensure vendor master data is complete and accurate Purchases from unauthorized supplier not appearing in list of approved suppliers 1- Ensure previously blacklist vendor is not part of the vendor master data
Goods Receipts
1- Review of vendor contracts to ensure all major aspects are covered (Price, T&C, Payment Terms
Absense of an approved policy
4 Contracts and Policies To ensure compliance with company policy and vendor contracts & etc)
Absence of T&C from the contracts
2- Review policy and procedure relaed to P2P to ensure all aspect of the process is covered
Ensure that adequate segregation of duties exist to mitigate the 1- Review GRN process to ensure adequate segregation of duties between persons who are receiving
5 Segregation of Duties No existense of Segregation of duties.
risk of error/fraud and recording of goods
1- Check on sample basis whether a Goods Receipt Note (GRN) and a Service Receipt Note (SRN)
received and signed by relevant aurhority and is tracked against the PO/ Contract.
6 Validation of Goods Goods received as per PO scope Goods receipts may not be as per the PO scope
2- During the physical visit, also determine how the quantity received is verified, i.e. by estimation/
judgment, by actual weighing, etc.
GR/IR account may have long standing balances which are not cleared on a timely 1- Review GR/IR account and identfy balances which are not yet cleared and track back with
7 Ensure timely clearance of GR/IR account.
basis. respective PO and GRN to ascertain whether PO is close or not
Reconciliation & Monitoring
Ensure quantity is received as stated in the PO 1- On selected sample, Compare GRN with respective PO to ascertain whether the goods/services are
8 Goods received quantity varies from the Quantity as per PO.
(Article/size wise) received as per PO Scope
1- Physically visit the Receiving Area/ Store to inspect its layout. Ensure that goods pending
Ensure that only the goods that are in acceptable condition & in Goods that do not comply with the agreed standards may be passed through
9 Inspection of Goods inspection are adequately segregated.
compliance with the agreed standards are accepted. inspection
2- Ensure quality inspection staff must be segregated
1- Understand the payment process and ensure segregation of duties are exist
2- Review Payment approval authority matrix and check whether the same is implemented
16 Payment Approval Ensure payments are processed after due approval Unauthorized payment made to vendor
3- Payment made on extraordinary basis (single quotation, cash payment over & above the limit non
compliance section 3.1)
Ensure purchaes for which payments are made are within the
Payment subseuquent to check
17 OTB Plan approvals where any deviations approved by Higher
of OTB Plan
authorities.
Payments Made by Credit Ensure only authorized person must have access to credit card 1- Understand the process related to use of credit card and who have the access.
19 Payments may be made for personal expenses
Card and payment approval must be attached 2- Review on sample basis, transaction made through credit card and trace respective approvals
20 Cash Payments Ensure cash payments only made for petty expenses Cash may be used for making payments other than imprest expense 1- Review cash payment voucher to ensure payment only made for petty expenses.
Sr. No Process Name Sub Process Control Objective Risk Description Test Plan
1- Advances released to vendors, check that these are as per the contract. Also, ensure correct
21 Advance Payments Ensure advances are issue to suppliers after the proper approval. Absense of approval for Advances issued to suppliers.
accounting for the same.
Ensure timely settlement of advance with suppliers and reconcile Advances may not be settled on time and accurately. 1- Review advances released to vendors and check whether advances are sett off from the final
22 Advance Payments
balances. Payments may get duplicated due to incorrect set off. payment schedule
23 Payment Recon Ensure that 3 way match perform by the finance team 3 way match may not be perform by the finance team 1- On sample basis, perform 3 way match (Invoice, GRN & PO) and report if there is any deviation
24 Pre & Post Discount Ensure pre & post discount are received Discount may not be adjusted/claim 1- On sample basis, recalculate the discount and its adjustment against the invoice
Issuing and Approval of Ensure issuance of payment cheque is authorized and signed as
25 Unauthorized cheque may be issue to vendor 1- Check whether DOA related to issuance of cheque is exist and ensure the same is followed
cheque per DOA
26 SOA Ensure timely updating of vendor statement of account Vendor statement of accounts may not be updated 1- Check on sample basis, whether SOA updated on accurately and timely
General Entity Level Controls 1- Review Delegation of authority. Gain an understanding of the authority matrix.
Ensure Entity Level controls are exist and implemented
27 Entity Level Control may not exist/implemented 2- Review SOPs for Procurement to Pay
accordingly
3- Review Organization structure and identify any conflicting roles/reporting relationship
Open PO's
28 Ensure timely closing of PO PO may not be close on timely basis 1- Highlight long standing open PO's and discuss with the management.
A B C
Requisition PO GR/IR/receipt
Attributes
Quantity Amount Quantity Amount Quantity
C D E
GR/IR/receipt Invoice Payment Differene in amount
Amount Quantity Amount Quantity Amount B-A C-B D-C E-D E-C
Difference Approval
Known/unknown yes/ no
Check for service vendor (marketing or other), employee master VS vendor master comparison