What is Assertion ?

What is Assertion ? 

         According to Oxford dictionary, it defines that an assertion as a confident and forceful statement of fact or belief. It is same as stating an opinion or making a claim.

            Management assertion is required to be made or claims from company executives to the public regarding certain aspects of business. In order to audit the financial statements of a company, auditors will rely on many classifications of assertion about the business and test management’s assertions and form an opinion to which the attest to the public. 

            There are three classifications of management assertions : transaction and events for the period under audit, account balances at the period end as well as presentation and disclosures. Firstly,  assertions that related to transactions and events, mostly found in the income statement for the period under audit :

• Classification - All transactions and events have been recorded within the proper account in the general ledger.
• Occurrence – Transactions and events that have been recorded that actually occurred and pertain to the entity.
• Completeness - All business transactions and events that should have been recorded.
• Accuracy – Amounts and other data that related to record transactions and events have been record appropriately.
• Cutoff - All transactions were recorded within the correct accounting period.

            Besides that, assertions that related to the account ending balances and primarily to the balance sheet at the period end :

• Completeness - All reported assets, liabilities, and equity interests have been fully reported.
• Existence - All account balances exist for assets, liabilities, and equity interests.
• Rights and obligations - The entity hold or controls the rights to the assets it owns and is obligated under its reported liabilities.
• Valuation - All assets, liabilities, and equity equity interests are included in financial statements have been recorded at their proper valuations.

            Last but not least, assertions that related to the presentation of information within the financial statements, as well as the accompanying disclosures:

• Accuracy and valuation -  All information disclosed is in the correct amounts, and which reflect their proper values.
• Completeness - All transactions that should be included in financial sattements ave been included.
• Occurrence - The assertion is that disclosed transactions have indeed occurred.
• Rights and obligations - The assertion is that disclosed rights and obligations actually relate to the reporting entity.
• Understandability and classification -  All information included in the financial statements has been appropriately presented and is clearly understandable.

            Each assertion type is intended for a different aspect of the financial statements, with the first set related to the income statement, the second set to the balance sheet, and the third set to the accompanying disclosures.

            If the auditor is unable to obtain a letter containing management assertions from the senior management of a client, the auditor is unlikely to proceed with audit activities. One reason for obtaining the letter is because management has engaged in fraud in producing the financial statements.

Source: https://www.youtube.com/watch?v=UX0gmCDq6h8

Published by Rutgers Accounting Web on Jul 15, 2015

Title: Assertions, Evidence, & Audit Procedures

Reference :  

https://www.accountingtools.com/articles/what-are-management-assertions-in-auditing.html

http://thenewsnigeria.com.ng/2016/04/audit-objective-and-management-assertions/

The improvement of Accounting profession by technology

What is Accounting ? 

Accounting is a system of recording information which involves the process of analyzing, classifying, summarizing and interpreting financial transaction of business. Different categories of users need different kinds of information for decision making. The users can divide into two which are external users and internal users. Internal users are the group or person at all level within the company that use the accounting information to make decision for the entry such as owners, managers, employees. External users are the person or organization who perform accounting function outside the company that use accounting information to make decision about the entry such as investors, creditors, governments, customers, competitors.

Technology Evaluation of Accounting

As we all know that, Accounting has improve a lot since past until now. It have many improvement on accounting. 

Evolution in accounting technology

According to the picture above, we can see that accounting job have changes a lot. At first, we do accounting by paper and pen. Then, the accounting computer comes out such as Microsoft office. After that, people are using accounting software that make accounting job become more easier. For now, we can even do accounting in smartphone that totally give many advantages to all of the accountant. 

Quickbooks 

Quickbooks in Mobile phone and Tablets 

This are one of the example of accounting app that can use in Smartphone. According to the information from Capterra, "QuickBooks" is the most famous accounting software in the market.  

Prediction for the future of accounting profession

   According to Sin Chew Plus Education (13-3-2018) which written by editor Poon Yin Sing, it says that the accounting profession will have dramatic changes in recent years. Accountant job can be replace by Adobe Illustrato (AI) due to the technology advanced.

Sin Chew Plus Education

    Therefore, all the accountant, include student who are studying accounting needs to be more hardworking to keep pace with technology. There are some simple works such as Ordinary Clark will be replaced by AI. So that,, we must emphasis on education and hardworking to avoid loss of jobs opportunity. For example, at least complete a degree level of study.

The Mary Sue

Written by Dan Van Winkle

28 June 2016

   According to 'THE MARY SUE' article, it says that accounting job will be replaced by AI in the future. This is because robots can do things faster and easier. So that, with the technology advances, people will none stop create new AI for reduce human work.

  In my opinion, technology nowadays become more and more advances. In future, receipt and invoice can receive online, which means electronic receipt and electronic invoice. Besides that, it's also possible to have a scanner that can auto record all the transaction. In conclusion, accountant's job will become simple and easier in the future due to the improvement in technology.

Does The Accountant Cosider as a Hard Job ?

DOES THE ACCOUNTANT CONSIDER AS A HARD JOB ?

Is accountant a hard job? For me is yes. According to the PayScale, we can know that one to four years experiences of accountant is thirty-five per cent,  but with more than five years experiences are gradually decreases, accountants with more than 20 years of experiences for only six per cent. The statistics tell us that the accountant is not an easy job, otherwise wouldn’t have so many accountants will choose to leave the accounting firm in a few years later as an accountant. 

PayScale, https://www.payscale.com/research/MY/Job=Accountant/Salary/b58d422f/Kuala-Lumpur

Below are the cons of being an accountant:

EDUCATION IS ON GOING

If you want to make progress in your career as an accountant, you need to plan on continuing education in future.  Actually, more education received is the main key to improve status and increase wages. Besides that, there several types of certificates are available for accountants such as CMA, ACCA, and CFA. However, the most prestigious is tending to be CPA certificate. It not only can make higher salary but also creates more opportunities for career development. These certificates take a lot of time and energy even sacrifice your leisure time to get it. So, it is not easy to earn a certificate.

BORING

If you are a person who is enjoying routine, regulations and rule, accountant is a quite suitable job for you. However, if you are a creative and hyper person and don’t like to do the same works every day in the office for hours, the regular works will be grind and bored for you.

THERE IS A BUSY SEASON

If you want to be an accountant, you will be prepared to work overtime. This is because accountant is usually a standard nine to five job. Usually, this does apply all year round, but at the time of tax season or the end of the year, when workload is high, you will spend a lot of time in the office, even work at night and in weekend. For example, the busy season as an accountant is from January to April in the Malaysia every year in order to submit the report to Lembaga Hasil Dalam Negeri.

STRESS

Usually, stressful goes along with busy season which I mentioned above. ‘Economia’ reported that 32% of the accountants feel stress in their daily lives. In addition, the heavy workload also will make you difficult to balance your daily work and life. Hence, you must ask yourself, how well do you cope with stress. If you can calm down under pressure, then you may suitable for this job. But if you are very easy to feel tired, accountant is not suitable for you.

When choosing a career path, it is important to weigh the pros and cons before making a final decision. For example, being an accountant has some advantages, such as being able to work from home and earn high salaries. However, this professional also has some cons. The primary disadvantages of being an accountant include factors such as working really long hours and having to continually take classes for as long as you practice.

Source: https://www.youtube.com/watch?v=OtD5_sb75y0

Published by ENGINEERED TRUTH, Date: 4 May 2018, Title: Why I Quit Accounting