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So in Jeff’s audio he states the presentation and disclosure as one of the assertions for account balances:

Presentation and Disclosure

Existence

Rights and Obligations

Completeness

Valuation and Allocation

but the explanation in an mcq that i just did does not include presentation and disclosure as one of the assertions for account balances. So which is correct or am I looking at the wrong?

An auditor observes the mailing of monthly statements to a client’s customers and reviews evidence of follow-up on errors reported by the customers. This test of controls most likely is performed to support management’s financial statement assertion of:

A.

presentation and disclosure.

Correct B.

existence.

C.

both presentation and disclosure and existence.

D.

neither presentation and disclosure nor existence.

explanation:

Assertions tested by the auditor for classes of transactions and events for the period under audit:

Occurrence—Transactions and events that have been recorded have occurred and pertain to the entity.

Completeness—All transactions and events that should have been recorded have been recorded.

Accuracy—Amounts and other data relating to recorded transactions and events have been recorded appropriately.

Cutoff—Transactions and events have been recorded in the correct accounting period.

Classification—Transactions and events have been recorded in the proper accounts.

Assertions tested by the auditor for account balances at period end:

Existence—Assets, liabilities, and equity interests exist.

Rights and obligations—The entity holds or controls the rights to assets, and liabilities are the obligations of the entity.

Completeness—All assets, liabilities, and equity interests that should have been recorded have been recorded.

Valuation and allocation—Assets, liabilities, and equity interests are included in the financial statements at appropriate amounts and any resulting valuation or allocation adjustments are appropriately recorded.

If an auditor observes the mailing of monthly statements to customers and reviews evidence of follow-up errors, the auditor can determine if customer balances exist at the balance sheet date based on this evidence. The auditor can also determine that the billing transactions recorded in the sales and accounts receivable accounts occurred.

The question did not ask about whether the amounts were appropriately presented and clearly expressed (which would be an assertion associated with presentation and disclosure).

FAR. Feb 2014 76
REG. Jan 2015 79 half way there!!
BEC. Feb 2015 79 thank you God!!
AUD. Apr 20, 2015 and will be done. Hold that thought 65, 7/14/15 85!
Ok where was I? Oh thats right now I'm Done!!!!!!!!!
Ethics 92!!

"You down wit SEC?, yeah you know me!!!"

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