Valuation and allocation - audit process, Auditing

Valuation and Allocation - Audit Process

As we saw assets are usually valued at cost or a valuation less a provision for usage or loss of value.  We have to ensure therefore that the accounting policy adopted in determining the amount of provision to be written off in any one year is in accordance with the relevant IAS or generally accepted accounting principles or Companies Acts requirements.  The IAS often allows several accounting policies in a given set of circumstances.  Hence the question can often arise as to where the specific accounting policy chosen is suitable.  Frequently it falls on the auditor to decide on this suitability.  He has to realize the common practice in the industry, the requirements of the fair and true view and the previous practice in the company. Although the requirements of suitability will override for the IAS itself.  A policy required for valuation apart from to be suitable and acceptable, must be consistently applied within the entity, within the industry and from period to period and should be in accordance along with IAS.

However Liabilities as we said are mostly valued at cost, whether they include estimation or they are provisions for particular liabilities then they must be in accordance along with clearly stated accounting policies also. Each values should be determined on not replacement cost and a historical cost basis.

Posted Date: 1/25/2013 1:38:33 AM | Location : United States







Related Discussions:- Valuation and allocation - audit process, Assignment Help, Ask Question on Valuation and allocation - audit process, Get Answer, Expert's Help, Valuation and allocation - audit process Discussions

Write discussion on Valuation and allocation - audit process
Your posts are moderated
Related Questions
if a proxy is voted as per his judgement other than member prescribed to him... what is the action to be taken?

Statutory Audits The audits are compulsory below statute in the case of a large amount of number of undertakings involving the following as:        Undert

Goodwill and Fair Value The main points the auditor needs to verify for any goodwill arising in the accounting period are as follows: (i) Examine the procedure used to find

Explain appropriate audit procedures you would apply in verification of cheque payments.

concept,need,advantage

Key Audit Areas Key audit areas in detail (a) Ascertainment of creditors and debtors:   Insurance companies do not keep their personal ledgers in such a way as to prod

Factors Affecting and Controlling Occupational Health (i) Walking-Working Surface Workers must work or move on different surfaces while working. Such - surfaces are cha

Disclosure Requirements - Investment In common terms, the following items have to be disclosed in the concern to all investments: (a) The accounting policies about:-

project report on absorption of overhead and its different method

Banks under Companies Act Banks are incorporated under the Companies Act like any other business but are granted special privileges under the same Companies Act and subjected t