Manish Savani (Student) (56 Points)
17 December 2015
CA Prateek Garg
(CA in Practice)
(1447 Points)
Replied 18 December 2015
To understand these terms you have to first study the SA 315. According to SA 315, Auditor shall identify and assess the risk of material misstatement –
a. At the financial statement level and
b. At the assertion level for Class of transaction, A/c balance and disclosure.
Meaning of Assertion
Assertion is 'representation by management in the financial statement'.
For E.g. when you see Rs. 500000/- against Fixed Asset in Balance sheet it is an assertion made by management. likewise all the balances in Balance sheet, Profit and Loss A/c or disclosures made in notes are various assertions made by management.
Meaning of Risk at Financial Statement Level and Assertion Level
1. Those Risk which can affect the all the assertion made in the financial statement are Risk @ Financial Statement.
2. Those risks which affect any assertion in particular (and not entire financial statement) are Risk @ Assertion level
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