current liabilities

Question 1

what assertion is the primary concern for liabilities

Answer 1

completeness

perform a search for unrecorded liabilities- review disbursements subsequent to the bs date and determin if should be included to year end payables.

inspect open or unpaid bills

inquiry management of upaid items

Question 2

existence

Answer 2

inspect underlying docs, supporting recorded payables

and compare to cash disbursement at year end (existence is not that important to test).

Question 3

valuation

Answer 3

not usually a major issue since we expect clients to pay what they owe

Question 4

rights and obliagation

Answer 4

read docs underlying liabilities -look for anything unusual

inquire about related party transactions that may need seperate disclosure

other current lia (sal payable, div payable, int payable) addressed using analytical procedures

Question 5

tip- difference between completeness and existence is in the records

Answer 5

going top to down in reviewing accounting doc and records-existence

going down to top-completeness