![]() Neither the Company nor any of its Subsidiaries has any accounts receivable or loans receivable from any Person that is an Affiliate of the Company or any of its Subsidiaries or from any director, officer or employee of the Company or any of its Subsidiaries or any Affiliate thereof.Īccounts Receivable All Accounts Receivable of the Company and the Company Subsidiary that are reflected on the Balance Sheet or on the accounting records of the Company as of the Closing Date represent or will represent valid obligations arising from sales actually made or services actually performed in the ordinary course of business of the Company. Since the Balance Sheet Date, the Company and its Subsidiaries have collected their respective accounts receivable in the ordinary course and in a manner that is consistent with their prior practices. generally accepted accounting principles and represent bona fide completed sales made in the ordinary course of business, are valid claims and, to the Company’s best knowledge, are not subject to any set offs or counterclaims and are fully collectible in the normal course of business after deducting the reserve set forth in the Company’s Balance Sheet. ![]() None of the Grantors’ accounts receivables are, nor will any hereafter arising account receivable be, evidenced by a promissory note or other Instrument (other than a check) that has not been pledged to the Administrative Agent in accordance with the terms hereof.Īccounts Receivable Accounts Payable (a) All of the accounts receivable of the Company and its Subsidiaries are reflected on the Company’s balance sheet (the “Balance Sheet”) at Decem(the “Balance Sheet Date”) in accordance with U.S. No Account Debtor has any defense, set-off, claim or counterclaim against any Grantor that can be asserted against the Administrative Agent, whether in any proceeding to enforce the Administrative Agent’s rights in the Accounts included in the Collateral, or otherwise, except for defenses, setoffs, claims or counterclaims that could not reasonably be expected, individually or in the aggregate, to materially adversely affect the value or collectability of the Accounts included in the Collateral, taken as a whole. Related to Accounts Receivable ConfirmationĪccounts Receivables Each existing Account constitutes, and each hereafter arising Account will, when such Account arises, constitute, the legally valid and binding obligation of the Account Debtor, except where the failure to do so could not reasonably be expected, individually or in the aggregate, to materially adversely affect the value or collectability of the Accounts included in the Collateral, taken as a whole. ![]() Accounts Receivable and Accounts Payable.The accounting firm most frequently registers the audit confirmations manually, which raises the risk for data entry mistakes particularly when trading with various currencies and many customers and suppliers. The accounting firm records the answers separately as they come in and forms the final audit evidence for the accounting sector. This step can usually need various manual reminders in order to obtain an acceptable response rate.ĥ. It is responded by the audit client’s consumers and suppliers back to the audit confirmation by utilizing a self-addressed and imprinted envelope or by returning the individual email sent by the accounting firm. The accounting firm sends the audit confirmations to the audit client’s consumers and suppliers both by post or electronically as an e-mail attachment.Ĥ. The resulting audit confirmations include as a least the client or supplier, the amount in question, the balance sheet date and a confirmation request.ģ. The accounting firm chooses a representative sampling from the audit client’s export and produces the audit confirmations with the guidance of the mail merge features standard in different word processing devices. ![]() It is imperative that the accounting firm get accurate accounts receivable and payable data from the audit customer’s documents.Ģ. The audit customer gives the accounting firm exportation of their consumers and suppliers including the accounts receivable and payable balances from their accounting method. The standard audit confirmation method includes multiple manual actions and normally requires the following five steps:ġ. What are the Steps to the Traditional Audit Confirmation Methods? A positive confirmation is deemed to signify a higher quality of proof than a negative approval since the auditor obtains explicit proof from the third party. ![]() What is Positive and Negative Confirmation in Auditing?Ī positive confirmation is an interrogation made by an auditor to a third party that needs a response. ![]()
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