Verification (audit)

Verification means "proving the truth" or "confirmation". Verification is an auditing process in which auditor satisfy himself with the actual existence of assets and liabilities appearing in the Statement of Financial position.[1] Verification is usually conducted through examination of existence, ownership, title, possession, proper valuation and presence of any charge of lien over assets.

Thus, verification includes verifying:[2]

  1. The existence of the assets and liabilities.
  2. Legal ownership and possession of the assets
  3. Correct valuation, and
  4. Ascertaining that the asset is free from any charge

Verification in an audit process can be done offsite or onsite. Offsite verification[3] means verification by checking documents, official records, photos and by questioning staff responsible or otherwise trusted to be a reliable source for the facility in verification. Onsite verification[4] means the verifying party is physically visiting the facility, getting introduced into due facts about it on the site where the facility is located and operated. The process may be regulated by law in certain countries.

Objectives

Objectives of Verification are:[2]

  1. To show correct valuation of assets and liabilities.
  2. To know whether the balance sheet exhibits a true and fair view of the state of affairs of the business
  3. To find out the ownership and title of the assets
  4. To find out whether assets were in existence
  5. To detect frauds and errors, if any
  6. To find out whether there is an adequate internal control regarding acquisition, utilization and disposal of assets.
  7. To verify the arithmetic accuracy of the accounts
  8. To ensure that the assets have been recorded properly
gollark: ... how many services have I not disabled properly
gollark: Um. What. The old IRC bridge?
gollark: Let's see if `kexec` works, since the BIOS on this server is awfully slow.
gollark: > An Validation is either a value of the type err or a, similar to Either. However, the Applicative instance for Validation accumulates errors using a Semigroup on err. In contrast, the Applicative for Either returns only the first error.> A consequence of this is that Validation has no Bind or Monad instance. This is because such an instance would violate the law that a Monad's ap must equal the Applicative's <*>
gollark: Allegedly:

References
  1. http://accountlearning.blogspot.com/2012/02/concept-of-verification-and-valuation.html Definition of Verification
  2. "VERIFICATION AND VALUATION". academia.edu.
  3. https://apparelcoalition.zendesk.com/hc/en-us/articles/360002369512-7-Protocol-for-Offsite-Verification-. Missing or empty |title= (help)
  4. https://apparelcoalition.zendesk.com/hc/en-us/articles/360002389151-6-Protocol-for-Onsite-Verification. Missing or empty |title= (help)
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.