Assertion Category Transaction or Specific Audit Objective

Balance
Existence or
Occurrence Transaction  Recorded sales transactions represent goods shipped or
service provided during the period.
 Recorded cash receipt transactions represent cash received
during the period.
 Recorded sales adjustment transactions during the period
represent authorized discounts, returns and allowances, and
uncollectable accounts.
Balance  Accounts receivable representing amounts owed by
customers exists at the balance sheet date.
Completeness Transaction  All sales, cash receipts, and sales adjustments made during
the period were recorded.
Balance  Accounts receivable include all claims on customers at the
balance sheet date.

Rights and
Obligation Transaction  The entity has rights to the receivables and cash resulting
from recorded revenue transactions.
Balance  Accounts receivable at the balance sheet date represent legal
claims of the entity on customers for payment.

Valuation or
Allocation Transaction  All sales and cash receipts and sales adjustments are valued
using GAAP and correctly journalized, summarized, and
posted.
Balance  Accounts receivable represent gross claims on customers at
the balance sheet date and agree with the sum of the accounts
receivable subsidiary ledger.
 The allowance for uncollectable accounts represents a
reasonable estimate of the difference between gross
receivables and their net realizable value.

Presentation  The details of sales, cash receipts, and sales adjustment

and support their presentation in the financial statements
Disclosure Transaction including their classification and related disclosures.

Balance  Accounts receivable are properly identified and classified in

the financial statements.
 Appropriate disclosures have been made concerning accounts
receivable that have been assigned or pledged.