Revenue audit is a detailed examination of an organization’s revenue-generating activities, processes, and transactions to ensure accuracy, compliance with accounting standards, and completeness of revenue recognition. It focuses on verifying the reliability and integrity of revenue streams reported in financial statements.

During a revenue audit, auditors review sales contracts, invoices, sales orders, revenue recognition policies, and supporting documentation to assess the accuracy and validity of reported revenue. They also evaluate the effectiveness of internal controls over revenue recognition, identify potential risks of revenue manipulation or misstatement, and recommend improvements to enhance revenue management practices.

Revenue audit helps organizations prevent revenue leakage, fraud, or errors, ensure compliance with revenue recognition principles, and maintain financial transparency. It also supports decision-making related to pricing strategies, sales incentives, and revenue forecasting.