1. Chapter 6 Managements’ Assertions Financial Statement Assertions
Page 158 – 160 (166-68)

2. David
What is the overall objective of the independent auditor in conducting an audit?

3. Overall Objective
AU-C Section 200 Overall Objectives of the Independent Auditor and Conduct of an Audit in
.11 The overall objectives of the auditor, in conducting an audit of financial statements, are to
a. obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, thereby enabling the auditor to express an opinion on whether the financial statements are presented fairly, in all material respects, in accordance with an applicable financial reporting framework; and
b. report on the financial statements, and communicate as required by GAAS, in accordance with the auditor's findings.

4. Abigail
What is a misstatement ?

5. misstatement
A difference between the amount, classification, presentation, or disclosure of a reported financial statement item and the amount, classification, presentation, or disclosure that is required for the item to be presented fairly in accordance with the applicable financial reporting framework (GAAP).

6. Audit objectives

7. Table 6-3
Page 159 (167)

9. We typically audit transactions differently than account balances differently than disclosures

10. Aidan
Describe 2 Significant Classes of Transactions

11. Classes of Transactions
Accounts receivable xxx.xx
Sales xxx.xx
Cash xxx.xx
Accounts receivable xxx.xx

16. Alyssa
Name three management assertions that relate to transactions.

17. Collin
Name three managements’ assertions that relate to account balances.

18. Cory Reflecting on the Vouch & Trace example
To which assertion would the following situation relate?
There is an entry in the Sales Journal for which there is no underlying Invoice

19. Dannia Reflecting on the Vouch & Trace example
To which assertion would the following situation relate?
There is an entry in the Sales Journal for which there is no underlying Shipping Document

20. Jared Reflecting on the Vouch & Trace example
To which assertion would the following situation relate?
The price on the Invoice exceeds the price on the Sales Order

21. Jillian Reflecting on the Vouch & Trace example
To which assertion would the following situation relate?
The quantities on the Invoice exceed the quantities on the Shipping Document

22. Kelsey Reflecting on the Vouch & Trace example
To which assertion would the following situation relate?
You locate a Sales Order, Shipping Document and Invoice for which there is no entry in the Sales Journal

23. Lauren Reflecting on Inventory
The audit client’s records indicate they have 187 cars in inventory but they only locate 184 cars when they take their physical inventory

24. Lynetta Reflecting on Inventory
The audit of the client’s Inventory records indicate each new car cost $28,500 but the vendor invoices indicate each car actually cost $27,500.

25. Monica Reflecting on Inventory
The client failed to adjust their inventory balance to Lower of Cost or NRV even though cost exceeds NRV

26. Neda Reflecting on Notes Payable
The balance sheet includes 3 Notes Payable at the local bank but a confirmation letter from the bank indicates there are actually 4 outstanding Notes Payable