Menu
- 3 Marks
Question
You were recently appointed by Danso & Co Chartered Accountants. You were part of the team that audited a construction company with a huge asset base. Your Manager reviewed your file and raised questions that audit evidence obtained was not relevant since it did not address any assertions of property, plant, and equipment. ISA 500: Audit Evidence requires that audit evidence must be sufficient, relevant, and reliable.
Required:
Explain THREE (3) assertions relevant to the audit of tangible non-current assets
Answer
Assertions relevant to the audit of tangible non-current assets:
- Completeness: Ensuring that all non-current assets are recorded in the financial statements.
- Existence: Verifying that the assets physically exist and are in the company’s possession.
- Valuation: Checking that the assets are correctly valued, including the accuracy of depreciation calculations.
(3 marks)
- Tags: Assertions, Audit Process, Equipment, Plant, Property, Tangible Non-Current Assets
- Level: Level 2
- Topic: Audit and Assurance Evidence
- Series: DEC 2022
- Uploader: Theophilus