Suspense Accounts, Sundry Deposits etc.
These are:
System for clearance of items debited/credited to these accounts.
The auditor should look into the procedure of the bank to determine whether entries raised in nominal heads of account including ‘Suspense Accounts’ and ‘Sundry Deposits’ or ‘Sundries Account’ are cleared expeditiously.
In the course of audit, the auditor would have examined large items and also old outstanding entries included in the year-end balances in such accounts. It is possible that whereas a debit entry has been raised to ‘Suspense Account’, the corresponding credit may be lying in ‘Sundry Deposits’; or other similar account and an exercise may not have been carried out by the bank to adjust these transactions on matching, after proper scrutiny thereof. In his report, the auditor should bring out large and old outstanding entries which deserve the attention of the Management for expeditious clearance. He may also make his suggestions to the Management for expeditious clearance of these entries by adjustment thereof after making a thorough scrutiny of the transitions. The auditor may also point out any adjustments of large outstanding in these accounts which have not been specifically explained to him in the course of his audit, for example, for want of relevant documents/evidence or vouchers, etc., and where he is not satisfied with the nature of adjustments made.
Where, in the course of audit, the auditor comes across any unusual items in ‘Suspense’ or ‘Sundry Deposits Account’, he should report the details of such items, indicating the nature and the amounts involved. The relevant information will be available to the auditor primarily from the branch audit reports.