1. The four management assertions for account balances at the
end of the reporting period.
- Existence: - The assertion is that
all account balances exist for assets, liabilities, and
equity.
- Completeness: - All assets,
liabilities and equity interests that should have been recorded
have been recorded and all related disclosures that should have
been included in the financial statements have been included.
- Rights and Obligations: - The
entity legally controls rights to its assets and its liabilities
faithfully represent its obligations.
- Valuation:- Assets, liabilities and
equity interests have been included in the financial statements at
appropriate amounts and any resulting valuation or allocation
adjustments have been appropriately recorded and related
disclosures have been appropriately measured and described.
2. The five management assertions
about transactions and transactions during the audit period.
- Cutoff: - The assertion is that all
transactions were recorded within the correct reporting
period.
- Occurrence: - The transactions
recorded have actually taken place.
- Completeness: - All transactions
that were supposed to be recorded have been recognized in the
financial statements.
- Classification: - Transactions and
events have been recorded in the proper accounts.
- Accuracy: - Transactions have been
recorded accurately at their appropriate amounts.
3. The five management assertions
for presentation and disclosure.
- Accuracy: - The assertion is that
all information disclosed is in the correct amounts, and which
reflect their proper values.
- Occurrence: - This means that all
the transactions in the accounting records actually took place. No
transactions are made up or are duplicates.
- Rights and Obligations: - The
transactions and disclosures pertain to the entity.
- Understandability: - The assertion
is that the information included in the financial statements has
been appropriately presented and is clearly understandable.
- Completeness: - All transactions
needing entry into the books are recorded. The business excludes
nothing.