Assertion applications and cash audit conclusions

Direct bank balance confirmation assertion

Primarily supports existence; the request and response may also address other banking matters and assertions.

Subsequent clearing of checks assertion

Helps assess reconciling item validity, cutoff, accuracy, and completeness of recorded disbursements, depending on test design.

Identified bank accounts compared with ledger

Supports completeness for the accounts examined; also seek evidence of accounts not identified by management.

Receipts before and after year end assertion

Cutoff, with possible implications for completeness and accuracy.

Bank confirmation restriction review assertion

Rights and obligations and classification, presentation, and disclosure of restricted cash or compensating balances.

Cash audit conclusion requirements

Independently evaluate the reconciliation and other evidence, address cutoff and transfer risks, and link the conclusion to relevant assertions.

Cash confirmation limitation

External confirmation is important but is only one component of the audit and does not replace the other necessary procedures.