FINANCIAL

STATEMENT AUDIT
(AICPA PRONOUNCEMENT)
TYPES OF FINANCIAL
STATEMENT ASSERTIONS
• COMPLETENESS - All of the information that should be
disclosed has been included within the financial statements
and accompanying footnotes, so that readers have a
complete picture of the results and financial position of the
entity.
• RIGHTS AND OBLIGATIONS - The entity is entitled to the
assets it is reporting, and is reporting all of its obligations as
liabilities.
• VALUATION OR ALLOCATION - Assertions about valuation or
allocation deal with whether asset, liability, revenue, and
expense components have been included in the financial
statements at appropriate amounts."
• EXISTENCE OR ACCURRENCE - The information
recorded in the financial statements actually
occurred during the year; fraudulent transactions
are most likely to violate this assertion.
• STATEMENT PRESENTATION AND DISCLOSURE -
assertions about presentation and disclosure deal
with whether particular components of the
financial statements are properly classified,
described, and disclosed
 • analysis and review
• Retracing the procedural
steps followed in the
accounting process and in
developing the work sheet
SOURCES OF and allocations involved
EVIDENCE • recalculation
• reconciling related types
FOR and applications of the
FINANCIAL same information
STATEMENT
AUDIT
 NATURE OF EVIDENCE FOR
FINANCIAL STATEMENT AUDIT
 SUFFICIENCY OF
EVIDENTIAL MATTER
 EVALUATION OF
EVIDENTIAL MATTER