what is the difference between audit in financial statements level and audit on assertion level?
1. Audit at financial statements level means independent examination of financial statements i.e. Balance sheet, Profit and Loss account, Cash flow statement, Notes to accounts, receipts and payments account and statement of changes in equity, which the objective to give an opinion on financial statements. 2. Audit at assertion level involves independent examination of : i. Existence: Whether the asset or liability exists as on balance sheet. ii. Right : Whether the entity has right to use the asset i.e. whether the entity has mortgaged the asset or not. iii. Valuation: Whether all assets and liabilities are properly valued as per the accounting standards, laws and regulations. iv. Disclosure: Whether all assets and liabilities are properly disclosed as per the relevant laws and regulations.
- At financial statement level, audit must perform the following precedure: + Emphasis of professional scepticism on team; + assignment of audit resources; + supervision and review; therefore, Audit at the financial statement is primary and reach to conclusion of overall FSs, from procedure made on assertion level.