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Cut-off could be for one of the followings;
Sales, to ensure that the end-period sales are probably disclosed
Inventory , to ensure that the end-period items are probably disclosed
Purchases , to ensure that the end-period purchases are probably disclosed
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Cut-off is the most critical to the accurate recording of transactions. The auditor should consider whether management has instituted adequate cut-off procedures.The procedures intended to ensure that movements into, within and out of inventory are properly identified in the accounting records.
First you need to establish whether you have tested the controls over the area you are looking at. So for example if you are doing a sales cutoff you might have done controls testing over the process. If the controls have passed then that gives you a bit more confidence and you don’t have to do a very extensive substantial testing ( test of detail)
