Audit Assertions and Procedures for Testing Cash Balances Identify and Demonstrate

question 35

Essay

Audit assertions and procedures for testing cash balances Identify and demonstrate the audit assertions and different approaches to obtaining audit evidence for an audit of cash balances in a financial statement audit.

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Definitions:

Temporary Accounts

Accounts used to collect information during a single accounting period, which are reset by transferring the balance to a permanent account at the period's end.

Prepaid Expenses

Items such as supplies that will be used in the business in the future.

Current Assets

Assets that a company expects to convert into cash, sell, or consume within one year or during its operating cycle, whichever is longer.

Post-closing Trial Balance

A summary listing of all company accounts that remain after closing entries have been made, serving as a check that debits equal credits.