Acc 490

Topics: Balance sheet, Finance, Investment Pages: 3 (674 words) Published: February 4, 2012
5-30The assertions for items 1-11 are as listed below:
1. Valuation or allocation
2. Completeness
3. Existence and occurrence
4. Completeness
5. Rights and obligations
6. Completeness
7. Valuation and allocation
8. Existence and occurrence
9. Presentation and disclosure
10Valuation or allocation
11. Presentation and disclosure

6-22 Audit evidence
Bank statement sent directly to the auditor by the bank
1) directly from outsiders
Creditor monthly statement obtained from client’s files.
2) indirectly from outsiders
Vouchers in client’s unpaid voucher file.
4) entirely internal
Duplicate sales invoices in filled order file.
4) entirely internal
Time tickets filed in payroll department.
4) entirely internal
Credit memo in customer’s file.
4) entirely internal
Material requisitions filed in storeroom.
4) entirely internal
Bank statement in client’s files.
2) indirectly from outsiders
Management working papers in making accounting estimates.
4) entirely internal
Paid checks returned with bank statement in (1) above.
3) internal but validated externally
Letter in customer file from collection agency on collectibility of balance. 2) directly from outsiders
Memo in customer file from treasurer authorizing the write-off of the account. 4) entirely internal

In general, evidence obtained directly from outsiders is more reliable than internal documents prepared by the Management or their staff. Internally generated documents that are not circulated externally are the least reliable sources.


Key CategoriesDescribe the knowledge used to develop a knowledgeable perspective about HipStarIdentify how the knowledge might assist in assessing the risk of material misstatement 1.Industry ConditionsIs the music industry demand for on line music growing?

Who are the competitors?

Is the model easily replicated?This will help determine value of intangible assets such as goodwill. 2....
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