What are audit assertions?
Definition Audit assertions are claims made by management that financial statements are accurate and do not contain any errors. Here, auditors’ work begins and they … Read more
What is Know your client – (KYC) in an audit?
Definition In an audit, know your client means an auditor needs to understand client business. The understanding needs to be obtained from different perspectives including … Read more
What are the audit procedures?
Definition Auditors perform audit procedures to obtain sufficient and appropriate audit evidence on the identified risks. Generally, auditors understand business, assess the risk of material … Read more
What is audit scoping?
Definition Audit scoping refers to the process of setting extent, nature, and timing of audit procedures to be performed. The scope of auditing is dependent … Read more
Quality Control Review (Definition, Importance, Elements, Procedure)
The term Quality control review is widely used in the world of accounting and auditing. It aims to enhance the accuracy of implemented controls in … Read more
Bookkeeper and accountant (what is the difference)
People often put off their business idea because bookkeeping and accounting scare them. We understand it can be tough and technical to do tax and … Read more
What is cut off testing in the audit?
Definition Cut off testing refers to determining if accounting entries are recorded in the correct accounting periods. The purpose of this exercise is to determine … Read more
What is target costing?
Definition Target costing is a systematic way to set product price. It considers the current market price and desired profit to set production cost. It … Read more
What is substance over form in accounting?
Substance over form principle states that transaction should be recorded based on realism (substance). If there is a conflict between realism and form (legal aspects), … Read more
What are analytical review procedures?
Definition The auditor performs analytical review procedures during audit execution. As the name suggests, it’s analytical. It means numbers are compared with other numbers by … Read more
What Is Operational Audit
An operational audit is conducted to evaluate the performance of a company’s operations. It includes both day-to-day activities and broader-scale activities. This type of audit … Read more
Trading Account in Accounting
The name trading account is given to a ledger account used by trading business firms to aid in the formation of income statement and balance … Read more
Economy Pricing Strategy
What Is Economy Pricing Strategy? Economy pricing strategy is one of the four pricing strategies that a company might choose depending on its needs, goals, … Read more
Provision For Income Tax
At the end of the accounting period, the businesses need to record a provision for income tax. The provision is recorded to fulfill the accrual … Read more
Company Infrastructure
Definition Company infrastructure refers to the structure of services, facilities, and procedures/policies used by a business. In fact, the foundation of business is based on … Read more
What is Feedback Control?
Definition Feedback control is a control system that relies on feedback for analyzing the discrepancy between actual and desired performance so that improvements can be … Read more
Accounting conventions (Definition, Importance, Examples)
Definition Accounting conventions are the set of guidelines that companies use to record financial transactions. These conventions play a vital role in the entire accounting … Read more
Component auditor (all you need to know)
Definition The component auditor is the one who works on the financial information of the component. In simple words, the component auditor performs the audit … Read more
List of current assets (Definition, Formula, and Examples)
Current assets are those asset of the business that can be liquidated easily. In simpler terms, the assets that can be easily converted into cash … Read more
What is a Compliance Audit?
Definition A compliance audit is an assessment carried out, mostly by third party auditors, to examine the extent to which a company’s internal policies, procedures … Read more