Well use earthwear examples and exercises throughout

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Unformatted text preview: blic audit clients. Management Assertions and Financial Statements We’ve seen that home sellers make a number of different assertions about which a home buyer might want independent assurance. What assertions does a company that is selling its stocks or bonds make? Some of the most important assertions entities make to investors are implicit in the entities’ financial statements. Immediately after this chapter you will find a set of financial statements for EarthWear, a hypothetical seller of high-quality outdoor clothing. We’ll use EarthWear examples and exercises throughout the book to illustrate important mes25435_ch01_001-032.indd mes25435_ch01_001-032.indd 10 26/05/11 9:24 PM Confirming Pages Chapter 1 An Introduction to Assurance and Financial Statement Auditing 11 audit concepts and techniques. Let’s consider what assertions EarthWear makes to potential investors when it publishes its financial statements. For example, EarthWear lists the asset account “Cash” on its balance sheet and indicates that the account’s year-end b...
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