Assignment Financial Statement Assertions Assertions simply means the act of stating, using and claiming something strongly. Financial statement assertions are representations by management that are expressed and contained in financial statement components. In effect, by presenting financial statements, management is stating, either explicitly or implicitly, certain things about the company's financial position and operations. The financial statement assertions are thus a company's official statement that the figures the company is reporting in the financial statements are a truthful presentation of its assets and liabilities following the applicable standards for recognition and measurement of such figures. Assertions play a key role in determining what is true and fair when auditing financial records. It is the responsibility of the auditors to test these characteristics in order to ensure that financial records and disclosures are correct and appropriately made. Question: Assume that you are an auditor of a company. Explain any THREE categories of assertions that you will be testing when auditing the financial statements of the company. You are required to: You are required to: (1.) Mention the name of the company you will be auditing along with the industry to which it belongs to (1 Mark) (li.) List the category of assertions (3 assertions) along with the element of financial statement that will be checked. (1.5 Marks) (ii.) Explain in detail the procedure adopted for collecting the audit evidence that you have mentioned in relation to question no. (ii) with proper justification and two sample transactions. (6 Marks) Distribution of Marks: Introduction: 0.5 Marks Question 1 : 1 Mark Question 2 : 1.5 Marks Question 3 : 6 Marks Conclusion : 0.5 Marks References :0.5 Marks Assignment Financial Statement Assertions Assertions simply means the act of stating, using and claiming something strongly. Financial statement assertions are representations by management that are expressed and contained in financial statement components. In effect, by presenting financial statements, management is stating, either explicitly or implicitly, certain things about the company's financial position and operations. The financial statement assertions are thus a company's official statement that the figures the company is reporting in the financial statements are a truthful presentation of its assets and liabilities following the applicable standards for recognition and measurement of such figures. Assertions play a key role in determining what is true and fair when auditing financial records. It is the responsibility of the auditors to test these characteristics in order to ensure that financial records and disclosures are correct and appropriately made. Question: Assume that you are an auditor of a company. Explain any THREE categories of assertions that you will be testing when auditing the financial statements of the company. You are required to: You are required to: (1.) Mention the name of the company you will be auditing along with the industry to which it belongs to (1 Mark) (li.) List the category of assertions (3 assertions) along with the element of financial statement that will be checked. (1.5 Marks) (ii.) Explain in detail the procedure adopted for collecting the audit evidence that you have mentioned in relation to question no. (ii) with proper justification and two sample transactions. (6 Marks) Distribution of Marks: Introduction: 0.5 Marks Question 1 : 1 Mark Question 2 : 1.5 Marks Question 3 : 6 Marks Conclusion : 0.5 Marks References :0.5 Marks
