Auditors gathering evidence to verify that recorded assets are owned by the entity and recorded liabilities represent commitments of the entity consider ________.
A)Rights and obligations
B)Completeness
C)Occurrence
D)Valuation and allocation

Question

Quizplus · Accepted Answer

The concept of rights and obligations focuses on whether assets recorded in the financial statements actually belong to the entity and whether the recorded liabilities represent the commitments of the entity. This is the most relevant concept for auditors when verifying ownership of assets and commitments of liabilities. Completeness relates to whether all transactions and balances have been recorded, occurrence relates to whether transactions recorded in the financial statements actually occurred, and valuation and allocation relate to whether assets and liabilities are recorded at appropriate values.

Auditors Gathering Evidence to Verify That Recorded Assets Are Owned