audit

major services by accounting firms

assurance, tax, auditing

revenues and expenses

occurrences and completeness

assets: existence

liabilities: completeness

the exception

tax services to audit clients are NOT prohibited

engagement letter

-should be prepared for new & on going engagements

-acts as contract between auditors and clients

-engagement letter is signed by audit partner & by client management (CFO or CEO)

vouching

=from accotinitng record to source documents

tracing

=from source document to accounting record

confirmation

borrowers= note receivables

lenders= note payable

registrar= maintain the issues security holder record

trustees= hold and manage properties on behalf of someone else

AR = IR x CR x DR