This is a composite, illustrative scenario, not an account of a named client. A sample invoice selected for cut-off testing was dated 31 March, the last day of the financial year, and had been included in that year's revenue. The e-way bill linked to the same consignment, pulled from the GST portal as a corroborating document, had been generated on 4 April — four days after the invoice date — which meant the vendor's own transport documentation showed the goods had not yet left the warehouse when the sale was recorded.
Why the e-way bill was the document that caught it
The invoice alone proved nothing about timing — it simply recorded what the company said had happened. The dispatch register, maintained internally, was consistent with the invoice date because it had been filled in by the same team with an incentive to show the sale as closed before year end. The e-way bill is different: it is generated through the GST portal, is tied to an actual vehicle and transporter ID, and under the e-way bill rules must be generated before the goods commence movement — so its timestamp is an external, system-generated fact that the company does not fully control after the event.
What widening the test showed
- 01Pulled e-way bills for every invoice dated in the last five days of March above a threshold valueOut of the sample widened to the full population above that threshold, six more invoices showed the same pattern — an e-way bill generated after the invoice date, by between two and six days.
- 02Checked whether any of the six had a legitimate explanationOne did — a part-shipment where the e-way bill for the final leg was genuinely generated a day later, which was accepted after review of the transporter's handover record.
- 03Quantified the remaining five as revenue recognised before the performance obligation was actually satisfiedUnder Ind AS 115, revenue is recognised when control of the goods transfers, which for ex-factory terms in this company's contracts was tied to dispatch — and dispatch had not occurred by year end for these five.
- 04Proposed an adjustment to reverse the five sales into the next periodManagement agreed after being shown the e-way bill dates alongside the invoice dates side by side.
| Invoice date | E-way bill date | Gap |
|---|---|---|
| 31 Mar | 2 Apr | 2 days |
| 31 Mar | 4 Apr | 4 days |
| 30 Mar | 3 Apr | 4 days |
| 31 Mar | 6 Apr | 6 days |
| 31 Mar | 4 Apr | 4 days |
What went into the file
- The full population of near-year-end invoices above the threshold, with e-way bill dates matched against invoice dates for each.
- The analysis of dispatch terms in the sales contracts to establish when control actually transferred under Ind AS 115.
- The proposed adjustment and management's agreement, with the five invoices reclassified into the following period.
- A note on the one exception investigated and accepted, so the file shows the gap was tested, not just counted.
How we think about this
An internal dispatch register and an invoice date are both documents the company produced and can both be made to agree with each other. An e-way bill timestamp comes from a government system the company cannot backdate after the fact, which is exactly why it is worth pulling as a corroborating source whenever cut-off is being tested near year end.
This is practical guidance written for audit teams, not an authoritative statement of any standard or statute. Standards, forms and timelines change. Check the current text issued by the ICAI and the relevant authority before relying on anything here in an audit file.
Related resources
- GST & GSTR-2BE-way bill compliance: what a statutory auditor checksWhat a statutory auditor checks on e-way bill compliance: threshold applicability, validity tracking, and reconciliation against the sales and purchase registers.
- Inventory & stockInventory cut-off testing around the year endGoods-in-transit at year end, last GRN and dispatch numbers before and after cut-off, and matching to the stock count and purchase/sales cut-off testing.
- Revenue, receivables & cut-offSales cut-off testing: dispatch, invoice and ledger datesWhy dispatch, invoice and ledger dates disagree at year end, how to sample either side of the cut-off, and the evidence that settles which date governs.
Free tools, no signup
Each one reads a file entirely in your browser — or, for two of them, just answers a few questions — and nothing is ever uploaded.
- Purchase register checkDuplicate payments, round-sum amounts, weekend-dated invoices, incomplete records.
- GSTR-2B reconcilerMatches your purchase register against GSTR-2B — missing invoices either side, amount mismatches.
- Bank reconciliation checkerMatches your cash book against a bank statement — what's outstanding on each side.
- Fixed asset register checkDuplicate asset codes, missing location or useful life, negative net book value.
- Payroll red-flag scannerBank accounts shared across employees, and records missing an ID, PAN or salary.
- CARO applicability checkerAnswer a few questions about the company and see which CARO 2020 clauses likely apply.
- MSME payment delay checkerMSME-flagged invoices paid — or still unpaid — beyond the 45-day Section 22 limit.
- Related-party transaction screenerTransactions above a threshold you set with no approval reference, grouped by counterparty.
- Depreciation useful life checkerCompares a useful life in use against the Schedule II, Part C indicative figure.
- Materiality calculatorOverall and performance materiality against PBT, revenue, assets or equity, with reasoning shown.
- Sample size calculatorStatistical sample size for a test of controls or a substantive test of detail.