Net Book Value of Fixed Assets (Explained with Example)

Fixed Assets

Definition: Net Book Value is the value of fixed assets after deducting the accumulated depreciation and accumulated impairment expenses from the original cost of fixed assets. Accumulated depreciation expenses are the total depreciation expenses of assets from the beginning to the reporting date. In other words, the total annual depreciation expenses since the day that […]

Net Book Value of Fixed Assets (Explained with Example) Read More »

What are the Five Elements of an Assurance Engagement?

Audit

Assurance engagement normally involves three parties and consists of five important elements. Those five elements include criteria, report, evidence, subject matter, and three-party relationship. Here is the detail: 1) Criteria: What are the criteria for the engagement? For example, if the engagement is the audit of financial statements, then the criteria would be the standards

What are the Five Elements of an Assurance Engagement? Read More »

Audit Procedures for Testing Sales Revenues (Risks and Assertions Included)

Audit, Audit Procedures

Overview: The audit procedure is one of the most important things that auditors need to ensure that they are well and correctly prepared, tailored, and executed to minimize audit works and reduce audit risks. Sales revenues are one of the sensitive areas that auditors need to place their great attention on since it is the

Audit Procedures for Testing Sales Revenues (Risks and Assertions Included) Read More »

Audit Procedure For Depreciation Expenses (Risks and Assertions)

Audit, Audit Procedures

Overview: Depreciation expenses are one of the significant expenses that reporting in the company’s income statement. Those expenses are the costs that the entity charged to fixed assets used for operation during the periods through depreciation by using the systematic methods accepted by certain accounting standards. In the income statement, depreciation expenses are allocated in

Audit Procedure For Depreciation Expenses (Risks and Assertions) Read More »

Account Payable Confirmation: Why Is It Important?

Audit

Account payable confirmation is the confirmation prepared and processed by auditors to cross-check the amount and information between the client’s records and the client’s supplier’s records.  Those could be included in the outstanding balances and transactions. Account payable is the current liabilities recorded by the client in financial statements as of the reporting date. It

Account Payable Confirmation: Why Is It Important? Read More »

Auditing Inventories: Procedures, Risks, Assertion, and More

Audit, Audit Procedures, Inventories

Overview: There are many audit procedures and approaches that auditors could use to perform during their detailed testing of the inventories report by management in the financial statements. Before going into detail on the procedure, it is good to start with the overview of inventories first. Inventories are the current assets that reporting in the

Auditing Inventories: Procedures, Risks, Assertion, and More Read More »