Term
| Define Tolerable Misstatement |
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Definition
| the maximum error in a population (for example, the class of transactions or account balance) that the auditor is willing to accept. |
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Term
If we are auditing assets are we most concerned with:
overstatement or understatement?
&
occurence or completeness? |
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Definition
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Term
If we are auditing liabilities are we most concerned with:
overstatement or understatement?
&
occurence or completenes?
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Definition
understatement
completeness |
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Term
If we are auditing AR or cash, are we most concerned with
existence or completeness? |
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Definition
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Term
If we are auditing AP or cash disbursements, are we most concerned with
existence or completeness? |
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Definition
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Term
| What are the 3 types of substantive tests? |
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Definition
substantive & analytical
substantive tests of detail
substantive tests of class of transactions |
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Term
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Definition
| the risk that the auditor may unknowingly fail to appropriately modify his opinion on the financial statemnts that are materially misstated |
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Term
| What do Test of Controls measure? |
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Definition
| The operating effectiveness of internal controls |
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Term
| What do Substantive Tests of Balances measure? |
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Definition
| Whether the dollar amounts of account balances are materially misstated |
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Term
| What assertions relate to Inventory and Accounts Receivable? |
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Definition
| Management assertions about Account Balances |
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