A company's accounting information system reports the book value of computer equipment as $25,000. During compliance testing, an auditor would need to see the computer equipment to verify which assertion?

Question

Quizplus · Accepted Answer

The auditor would need to see the computer equipment to verify its existence, which means that the equipment actually exists and is owned by the company. This is because book value only represents the recorded value in the accounting system, and does not guarantee the existence of the asset.

A Company's Accounting Information System Reports the Book Value of Computer