Becker Glossary Flashcards
One of three categories of financial statement assertions, relating primarily to assets, liabilities, and equity interests.
Account Balances
An approximation of a financial statement element, item, or account used because data either is not readily available or is dependent upon the outcome of future events.
Accounting Estimate
A request for independent verification of payables.
Accounts Payable Confirmation
A request for independent verification of receivables. Not that confirming accounts receivable is a required, generally accepted auditing procedure.
Accounts Receivable Confirmation
A financial statement assertion in the “transactions and events” category indicating that amounts and other data relating to recorded transactions and events have been recorded properly.
Accuracy
A financial statement assertion in the “presentation and disclosure” category indicating that financial and other information are disclosed fairly and at appropriate amounts.
Accuracy and Valuation
A ratio that measures how effectively an enterprise is using its assets.
Activity Ratio
An auditor’s report stating that the financial statements “do not present fairly…”
Adverse Opinion
A listing of accounts receivable categorized by age (i.e., current, 30 to 60 days, 60 to 90 days, etc.).
Aging Schedule
An engagement in which a practitioner is engaged to issue a report of findings based on specific agreed-upon procedures.
Agreed-Upon Procedures
Guidelines for the behavior of members of the American Institute of Certified Public Accountants (AICPA) in the conduct of their professional affairs.
AICPA Code of Professional Conduct
In sampling, a “cushion” for protection against undetected deviations that is added to the sample deviation rate to arrive at the upper deviation rate.
Allowance for Sampling Risk
An IT (information technology) department employee who determines system requirements and designs a processing system to meet those requirements.
Analyst
Evaluations of financial information made by a study of plausible relationships among both financial and non-financial data.
Analytical Procedures
The financial reporting framework that is acceptable in view of the nature of the entity and the objective of the financial statements, or that is required by law or regulation.
Applicable Financial Reporting Framework
Information processing controls that apply to the processing of individual “applications” (e.g., controls surrounding receivables, controls surrounding payroll, etc.).
Application Controls
The quality of being both reliable (valid, factual, objective, and supportable) and relevant (related to the financial statement assertion under consideration).
Appropriate (Appropriateness of Audit Evidence)
A document filed with the state to create a corporation.
Articles of Incorporation
A declaration about whether a subject matter is based on or in conformity with selected criteria.
Assertion
A relationship that arises when an accountant consents to the use of his or her name in connection with financial statements, or when an accountant has prepared the financial statements.
Association with Financial Statements
A situation in which the group engagement partner decides to assume responsibility for the work performed by a component auditor, and therefore does not refer to the component auditor in the auditor’s report.
Assumption of Responsibility
An engagement in which a practitioner is engaged to issue or does issue an examination, a review, or an agreed-upon procedures report on subject matter, or on an assertion about the subject matter, that is the responsibility of another party.
Attest Engagements
A statistical sampling method used to estimate the rate of occurrence of a specific characteristic or attribute in a population.
Attribute Sampling
Four characteristics used in analyzing risk: type, significance, likelihood, and pervasiveness.
Attributes of Risk