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Auditing Management Assertions - The Impact of SAS No. 106
Auditing Management Assertions - The Impact of SAS No. 106
eCommons
Accounting Faculty Publications Department of Accounting
12-2007
eCommons Citation
Archambeault, Deborah S., "Auditing Management Assertions: The Impact of SAS No. 106" (2007). Accounting Faculty Publications.
Paper 48.
http://ecommons.udayton.edu/acc_fac_pub/48
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Auditing Management Assertions: The Impact of SAS No. 106
By Deborah S. Archambeault, Ph.D., CPA
Figure 2: Management Assertions from SAS No. 106 SAS No. 31 Assertions SAS No. 106 Assertions
Applicability: Audits of non-issuers after 2006 Occurence (transactions)
Existence or occurrence
a. Assertions about classes of transactions and events Existence (balances)
for the period under audit Completeness (transactions)
1. Occurrence Completeness
Completeness (balances)
2. Completeness Rights and obligations
Rights and obligations
3. Accuracy (balances)
4. Cutoff Accuracy (transactions)
5. Classification Cutoff (transactions)
b. Assertions about account balances at the period end Valuation or allocation Classification (transactions)
1. Existence Valuation and allocation
(balances)
2. Rights and obligations
Occurrence and rights and
3. Completeness
obligations (Presentation and
4. Valuation and allocation disclosure)
c. Assertions about presentation and disclosure Completeness
1. Occurrence and rights and obligations Presentation and (presentation and disclosure)
2. Completeness disclosure Classification and
understandability
3. Classification and understandability
(Presentation and disclosure)
4. Accuracy and valuation
Accuracy and valuation
(presentation and disclosure)
continued on page 22
Tennessee CPA Journal | DECEMBER 2007 21
Auditing Management Assertions: The Impact of SAS No. 106
continued from page 21
sharpen concepts that existed, but were (emphasis added)” the corresponding assertion Board (IAASB). International Standard on Auditing
not explicitly stated, in the previous SAS included in SAS No. 106 is limited to “disclosed (ISA) 500: Audit Evidence. www.ifac.org/
No. 31 guidance. That is good news for events and transactions.” IAASB/Pronouncements.php
Public Company Accounting Oversight Board
practitioners, as they prepare to enter
References: (PCAOB). Interim Standards (2003). www.
the first audit season under the new American Institute of Certified Public pcaobus.org/Standards/Interim_Standards/
management assertion guidance. n Accountants (AICPA). Statement on Auditing index.aspx
Standards (SAS) No.106: Audit Evidence. New
Endnotes: York, NY: AICPA (2006). About the Author:
1. The only notable difference between the assertions American Institute of Certified Public Dr. Deborah S. Archambeault is an assistant
enumerated in SAS 106 and the assertions Accountants (AICPA). Statement on Auditing professor of accounting at The University of
enumerated in ISA 500 involves assertion c. i. Standards (SAS) No. 31: Evidential Matter (as Tennessee - Chattanooga. She can be reached at
related to presentation and disclosure. Whereas amended by SAS No. 80). New York, NY: AICPA debbie-archambeault@utc.edu.
ISA 500 makes an assertion about “disclosed (1980).
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