Describe the sales transaction audit trail from the point of sale to the general ledger posting to the consolidated sales accounts at the corporate office. Be sure to emphasize which aspects of the audit trail are in paper or electronic form.

Question

What will be an ideal response?

Answer 1

While the customer receives a paper receipt showing the details of a single transaction, the company
retained record of a single customer transaction is strictly in electronic form initially stored on the
cash register hard drive, which is backed up daily to the store’s computer server. The electronic cash
register record on the hard drive captures information about each transaction generated, including
quantity sold and unit price by product number.
When sales clerks close the cash register each night, the “register closing” option automatically
updates both the transaction online file stored on the cash register’s hard drive and the backup file
stored on the store’s computer server. At that point, the cash registers generate a paper summary
printout that summarizes the total amount of cash sales, debit or credit sales, sales returns, and any
other miscellaneous transactions for the day at that register. In addition, the sales clerk prepares a
paper-based Daily Deposit Sheet that summarizes the sales clerk’s count of the total cash and debit and
credit charge slips in the drawer. Any differences in the cash and debit and credit charge slip counts and
the cash register generated transaction totals is noted on the Daily Deposit Sheet. The Daily Deposit
Sheets provide an audit trail for each register in the store.
Store clerks forward all cash, debit and credit card slips, and Daily Deposit Sheets to the store
cashier. The store cashier verifies the accuracy of both totals. Accounting personnel reconcile totals
from all Daily Deposit Sheets to the printout of the e-mail confirmation of the deposit amount from the
bank, which are filed together by date. The subtotals of cash , debit, and credit card sales for each cash
register are also reported on a store Daily Sales Report, which is generated by the computer overnight
from downloads from each cash register hard drive. The Daily Sales Report, which is transmitted
electronically to the corporate office, also includes total store sales, as well as subtotals of cash, debit,
and credit sales for the day at that store. A printout of each store’s Daily Sales Report is filed both
in paper and electronic form at each store by date. The Daily Sales Report provides an audit trail
summary of all transaction totals for each register in each store by day.
The totals included on the store’s Daily Sales Report for each day are also reported on the
store’s Monthly Sales Report. This report shows daily sales totals for the store each day of the month.
An electronic copy of this report is transmitted to the corporate office from each store at month
end. And, a printout of the Monthly Sales Report is maintained at each store. Finally, the monthly
store totals from the Monthly Sales Report are shown as postings from each store in the month-end
consolidated General Ledger, which is also in printed form.