While auditing the accounts of a Cinema, the following points will receive special consideration on the part of an Auditor:
1- Auditor will examine the working of the system of internal check in operation in the business particularly in relation to cash receipts and payments ad un-issued tickets. He will see that un-issued tickets are kept under proper control and the issued tickets are duly signed by a responsible officer of the business.
2- Auditor will check the daily returns for the tickets sold for different shows. He will see that the collections are daily deposited into the bank. He can vouch receipts from tickets sold with the amount of entertainment tax paid.
3- Auditor will check other sundry receipts from contracts to supply refreshments, receipts from advertisements, hire charges of opera glasses, space allotted for display of goods etc, with the necessary documentary evidence available.
4- Auditor will carefully examine the film hire contracts. He will ascertain the terms and will see that the films purchased but not shown are properly valued and recorded. He will distinguish film hire from film purchases.
5- Auditor will carry out a thorough vouching of the operating expenses paid. He will see that they have been properly allocated between capital and revenue.
6- Auditor will see that all outstanding liabilities have duly been provided for and that adequate provision has been made for depreciation of buildings, furniture, machines and other assets.
7- Auditor will thoroughly vouch Cash Book, Pass-Book, Petty Cash Book, Employees Register and Wages Records.
He will ascertain the terms of charity performances, if any.
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