Moses San Miguel

1808 Words8 Pages
Assertions Existence and occurrence Audit Objectives: Substantiate the existence of receivables and the occurrence of revenue transactions. Prove none of the account receivables are fictitious. Completeness Audit objectives: Establish the completeness of receivables and revenue transactions. Rights and obligations Audit objectives: Determine the client has rights to the recorded receivables. Prove the accounts receivable are collectible in the normal course of business and are bona fide claims owe the company. Valuation or allocation Determine that the valuation of receivables and revenue is at appropriate net realizable values. Presentation and…show more content…
Any securities held by client as collateral for notes receivable should be inspected and listed at the same time. Complete control over negotiated instruments should be maintained until the count and inspection are completed. The confirmation letter sent to a bank, collection agency, secured creditor, or other holder should contain a request for verification of the name of the maker, the balance of the note, the interest rate, and the due date. Financial statement assertions: existence and occurrence, and rights and obligation. Internal control weaknesses addressed: Q1, Q2, Q3 and Q14 Confirm receivables with debtors. By confirming account receivable, the existence of the receivable and customers should be proved. Most positive confirmation forms will be sent to ask the debtor to confirm directly about the accuracy of the dollar amount shown on the confirmation request. Positive confirmation will be sent if the balance is greater than $7,500. The negative confirmation will be sent to address to the debtor company asking it to advise only if the balance shown is incorrect. Financial statement assertions: existence and occurrence, rights and obligation, valuation and allocation. Internal control weaknesses addressed: Q1, Q2, Q3 and Q14 Review the year-end cutoff of sales transactions. Financial statement assertions: existence and occurrence, rights and obligation,

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