Assertion ( claims)

Two types

Transitions and balances

Accounts types

1. Nominal accounts
 Revenue and expense
2. Real accounts
3. Personal accounts ( by name )( natural, artificial, representative)

Transitions: revenue and expenses

1. We testify occurrence, is it real

2. We testify accuracy, are the amount accurate
3. We testify completeness, are the transitions fully completed
4. We testify cutoff , accounting period
5. We testify classifications, correctness.

Balances: ( assets, liabilities, and owners’ equity )

1. We will testify Exitance

2. We will testify Valuations ( current assets and non-current assets both)
3. We testify completeness
4. We testify rights and obligations
5. We testify Presentations

vouching and tracing

Process Occurrence/ Accuracy Completeness cutoff Classifications
existence
Inspections of Physical books,
physical assets records, and
or books of counts
accounts
Observations The behavior of
the staff
Recalculation --------------

Analytical Budget vs actual

procedure
Enquiry Lab staff
Engineering
dept:

Conformations Supplier,
students
Tracing and Physical count
Vouching