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CPA AUD Flashcards > AUD 3 Internal Control 13 - 3 The Revenue Cycle (Sales Revenue, AR, Cash Receipts) > Flashcards

AUD 3 Internal Control 13 - 3 The Revenue Cycle (Sales Revenue, AR, Cash Receipts) Flashcards

1
Q

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

The assertions are discussed in detail in another section, but some specific applications of these assertions are frequently tested in discussing the revenue cycle.

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy
A

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

The assertions are discussed in detail in another section, but some specific applications of these assertions are frequently tested in discussing the revenue cycle.

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy
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2
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• U = Understandability and Classification
– Transactions and e____s have been recorded in the proper accounts and information is presented and described clearly.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

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3
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• U = Understandability and Classification
– Tran_______s and events have been recorded in the proper accounts

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4
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• U = Understandability and Classification
– Transactions and events have been re____ed in the proper accounts

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts

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5
Q

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper acc____s and information is presented and described clearly.

A

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

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6
Q

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is pre____ed and described clearly.

A

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

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7
Q

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and des____ed clearly.

A

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

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8
Q

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described cl___ly.

A

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

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9
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

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10
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

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11
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• P = Presentation and Disclosure
– Ma_________ asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

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12
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that a__ sales to employees have been properly identified in the statements and notes as related party transactions.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

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13
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been pr_____ly identified in the statements and notes as related party transactions.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

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14
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management a_____s that all sales to employees have been properly identified in the statements and notes as related party transactions.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

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15
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and n___s as related party transactions.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

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16
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party tran_______s.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

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17
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as re___ed party transactions.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

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18
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all s___s to employees have been properly identified in the statements and notes as related party transactions.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

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19
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The au____ may review sales invoices for specific sales to employees

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

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20
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales in_____s for specific sales to employees

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

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21
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then t___e these invoices to the general ledger entry

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry

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22
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger en___ to see if they are posted to the “due from employees” account.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

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23
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these in______s to the general ledger entry to see if they are posted to the “due from employees” account.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

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24
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are p___ed to the “due from employees” account.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

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25
Q

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” acc_____.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

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26
Q

Revenue Cycle

• P = Pres________ and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

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27
Q

Revenue Cycle

• P = Presentation and Disc______
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

A

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

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28
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

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29
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

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30
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• E = Existence or Occurrence (Vouching)
– Man_________ asserts that all sales that have been recorded actually have taken place

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place

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31
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been re____ed actually have taken place

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place

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32
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have ta___ place

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place

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33
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that a__ sales that have been recorded actually have taken place

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place

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34
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may sel___ a sales invoice

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice

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35
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales in_____ and vouch from the sales invoice to the bill of lading

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading

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36
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and v___h from the sales invoice to the bill of lading

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading

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37
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the b___ of lading

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading

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38
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of l__ing in order to ensure that

items billed to customers were based on actual shipments.

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

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39
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items b___ed to customers were based on actual shipments.

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

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40
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on ac___l shipments.

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

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41
Q

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual ship____s.

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

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42
Q

Revenue Cycle

• E = Exis______ or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

How well did you know this?
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43
Q

Revenue Cycle

• E = Existence or Occu______ (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

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44
Q

Revenue Cycle

• E = Existence or Occurrence (Vo___ing)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

A

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

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45
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

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46
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

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47
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• R = Rights and Obligations
– Ma________ asserts the right to collect receivables.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• R = Rights and Obligations
– Management asserts the right to collect receivables.

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48
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the r___t to collect receivables.

A

Revenue Cycle

• R = Rights and; Obligations
– Management asserts the right to collect receivables.

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49
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect rec_______s.

A

Revenue Cycle

• R = Rights andObligations
– Management asserts the right to collect receivables.

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50
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can v___h from postings in the subsidiary receivables ledger for a specific client

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

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51
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from p___ings in the subsidiary receivables ledger for a specific client

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

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52
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the sub___iary receivables ledger for a specific client

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

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53
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables led___ for a specific client

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

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54
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the s___s order, bill of lading, and sales invoice,

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

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55
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

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56
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales in____e,

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

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57
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

b__k to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

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58
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to es___lish that the goods were ordered, shipped, and billed,

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

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59
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were or___ed, shipped, and billed,

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

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60
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, sh___ed, and billed,

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

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61
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and b___ed, giving the company the right to collect.

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

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62
Q

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to co____t.

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

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63
Q

Revenue Cycle

• R = Ri___s and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

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64
Q

Revenue Cycle

• R = Rights and Obli______s
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

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65
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

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66
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

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67
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has re____ed all sales that have taken place.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

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68
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded a__ sales that have taken place.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

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69
Q

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may se____ a bill of lading

A

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

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70
Q

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then tr___ from the bill of lading to the sales invoice

A

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

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71
Q

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the s___s invoice

A

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

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72
Q

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all s___ped goods have been billed to customers.

A

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

73
Q

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that a__ shipped goods have been billed to customers.

A

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

74
Q

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been b___ed to customers.

A

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

75
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• C = Com_______s (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

76
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

77
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• V = Valuation, Allocation and Accuracy
– Management asserts that rec_______s are likely to be collected.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

78
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be coll___ed.

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

79
Q

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of cr___t approval before shipment

A

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

80
Q

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval bef___ shipment

A

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

81
Q

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers l___ly to pay.

A

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

82
Q

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is o_ly shipping to customers likely to pay.

A

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

83
Q

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to p__.

A

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

84
Q

Revenue Cycle

• V = Val_____, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

A

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

85
Q

Revenue Cycle

• V = Valuation, Allo______ and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

A

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

86
Q

Revenue Cycle

• V = Valuation, Allocation and Ac_____cy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

A

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

87
Q

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

• Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

A

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy

• Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

• Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

88
Q

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy
A

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy
89
Q

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Examples related to each assertion follow (U-PERCV):

• Unders_______ and Classification

A

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification

90
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Class_______

A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification

91
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Pres________ and Disclosure
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
92
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Dis________
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
93
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Exis______ or Occurrence (Vouching)
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
94
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occ_______ (Vouching)
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
95
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (V___hing)
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
96
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obli_________
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
97
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Comp________ (Tracing) and Cutoff
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
98
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (T___ing) and Cutoff
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
99
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and C_____
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
100
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Val_______, Allocation and Accuracy
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy
101
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allo______ and Accuracy
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy
102
Q

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Acc_____
A

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

  • Understandability and Classification
  • Presentation and Disclosure
  • Existence or Occurrence (Vouching)
  • Rights and Obligations
  • Completeness (Tracing) and Cutoff
  • Valuation, Allocation and Accuracy
103
Q

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Another way to look at the assertions:

As indicated, the auditor’s understanding of the system of internal control is to determine if the financial statement assertions are correct and may be relied upon.

In relation to sales for events and transactions (CPA-CO):

A

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Another way to look at the assertions:

As indicated, the auditor’s understanding of the system of internal control is to determine if the financial statement assertions are correct and may be relied upon.

In relation to sales for events and transactions (CPA-CO):

104
Q

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

In relation to sales for events and transactions (CPA-CO):

  • Completeness
  • Period Cutoff
  • Accuracy
  • Classification (Sorted)
  • Occurrence
A

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

In relation to sales for events and transactions (CPA-CO):

  • Completeness
  • Period Cutoff
  • Accuracy
  • Classification (Sorted)
  • Occurrence
105
Q

Ultimately, the reason an auditor cares about the internal control __________ is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

A

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

106
Q

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement __________ are correct and therefore may be relied upon.

A

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

107
Q

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are ________ and therefore may be relied upon.

A

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

108
Q

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be _____ upon.

A

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

109
Q

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Transactions and events have been recorded in the proper accounts and information is presented and described clearly.”

A

Financial statement assertion (U-PERCV)

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

110
Q

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.”

A

Financial statement assertion (U-PERCV)

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions. The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

111
Q

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.”

A

Financial statement assertion (U-PERCV)

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

112
Q

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.”

A

Financial statement assertion (U-PERCV)

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

113
Q

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.”

A

Financial statement assertion (U-PERCV)

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

114
Q

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.”

A

Financial statement assertion (U-PERCV)

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

115
Q

Examples related to each assertion (U-PERCV):

• Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

• Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

A

Examples related to each assertion (U-PERCV):

• Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

• Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

116
Q

Examples related assertion (U-PERCV):

• U______________ and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

117
Q

Examples related assertion (U-PERCV):

• Understandability and C____________

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

118
Q

Examples related assertion (U-PERCV):

• Understandability and Classification

– _____________ and events have been recorded in the proper accounts and information is presented and described clearly.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

119
Q

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and ______ have been recorded in the proper accounts and information is presented and described clearly.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

120
Q

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been _______ in the proper accounts and information is presented and described clearly.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

121
Q

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the ______ accounts and information is presented and described clearly.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

122
Q

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described ________.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

123
Q

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is ________ and described clearly.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

124
Q

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and ________ clearly.

A

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

125
Q

Examples related assertion (U-PERCV):

• _____________ and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

A

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

126
Q

Examples related assertion (U-PERCV):

• Presentation and ___________

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

A

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

127
Q

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all _____ to employees have been properly identified in the statements and notes as related party transactions.

A

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

128
Q

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales _________ for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

A

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

129
Q

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then _____ these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

A

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

130
Q

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general _______ entry to see if they are posted to the “due from employees” account.

A

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

131
Q

Examples related assertion (U-PERCV):

• _________ or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

132
Q

Examples related assertion (U-PERCV):

• Existence or _________ (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

133
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (_________)

– Management asserts that all sales that have been recorded actually have taken place.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

134
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been _________ actually have taken place.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

135
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all _____ that have been recorded actually have taken place.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

136
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales ______ and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

137
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and ______ from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

138
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the _____________ in order to ensure that items billed to customers were based on actual shipments.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

139
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items _____ to customers were based on actual shipments.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

140
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on ______ shipments.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

141
Q

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual ___________.

A

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

142
Q

Examples related assertion (U-PERCV):

• ______ and Obligations

– Management asserts the right to collect receivables.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

143
Q

Examples related assertion (U-PERCV):

• Rights and ___________

– Management asserts the right to collect receivables.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

144
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the _____ to collect receivables.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

145
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect ___________.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

146
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can _______ from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

147
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from ________ in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

148
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the ________ receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

149
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary __________ ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

150
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ________ for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

151
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales _____, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

152
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, ____________, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

153
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales _______, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

154
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ________, shipped, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

155
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and _____, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

156
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, _______, and billed, giving the company the right to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

157
Q

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the _____ to collect.

A

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

158
Q

Examples related assertion (U-PERCV):

• _____________ (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

159
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and ______

– Management asserts that it has recorded all sales that have taken place.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

160
Q

Examples related assertion (U-PERCV):

• Completeness (_______) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

161
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has __________ all sales that have taken place.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

162
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded ___ sales that have taken place.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

163
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a _____________ and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

164
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then _____ from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

165
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the ______________ to the sales invoice in order to ensure that all shipped goods have been billed to customers.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

166
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales _______ in order to ensure that all shipped goods have been billed to customers.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

167
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all ________ goods have been billed to customers.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

168
Q

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been _______ to customers.

A

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

169
Q

Examples related assertion (U-PERCV):

• _________, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

170
Q

Examples related assertion (U-PERCV):

• Valuation, __________ and Accuracy

– Management asserts that receivables are likely to be collected.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

171
Q

Examples related assertion (U-PERCV):

• Valuation, Allocation and __________

– Management asserts that receivables are likely to be collected.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

172
Q

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that __________ are likely to be collected.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

173
Q

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be ________.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

174
Q

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of _____ approval before shipment in order to determine that the company is only shipping to customers likely to pay.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

175
Q

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval ______ shipment in order to determine that the company is only shipping to customers likely to pay.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

176
Q

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit __________ before shipment in order to determine that the company is only shipping to customers likely to pay.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

177
Q

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is ____ shipping to customers likely to pay.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

178
Q

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to ___.

A

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

CPA AUD Flashcards (62 decks)

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