Audit assertions are the representations management makes, implicitly or explicitly, in the financial statements. The auditor uses them to identify what could go wrong and to design procedures, under SA 315 for risk assessment and SA 500 for evidence. They fall into three groups: classes of transactions and events, account balances at period end, and presentation and disclosure.
Facts checked: 10 October 2026. The assertion lists below were checked against ACCA's technical article on the assertions in ISA 315 (Revised 2019), a secondary source on the international text (ACCA). I could not open the ICAI SA 315 (Revised 2019) file, so wording and paragraph numbers are not quoted. The SA 315 text permits assertions to be described differently as long as all the aspects are covered. Confirm against the ICAI text before citing.
The assertions
| Group | Assertions |
|---|---|
| Classes of transactions and events for the period | Occurrence, completeness, accuracy, cut-off, classification, presentation |
| Account balances at period end | Existence, rights and obligations, completeness, accuracy, valuation and allocation, classification, presentation |
| Presentation and disclosure | Covered within the two groups above through the presentation assertion and the "related disclosures" wording |
In the 2019 revision, as reported in the ACCA article, disclosures are not a separate list: each of the two groups is headed "and related disclosures", and presentation is an assertion within each. Earlier versions of the standard, and much training material, show a separate third list for presentation and disclosure (occurrence and rights and obligations, completeness, classification and understandability, accuracy and valuation). That older list is from my own knowledge, not checked in this update. Use the version your methodology adopts, and make sure every aspect is covered.
Linking assertion, risk and procedure
An assertion becomes useful only when tied to a risk and a procedure (see SA 315, SA 500 and SA 330). The sequence is: identify the significant class or balance, ask under which assertion it could be misstated, assess the risk, and choose a response.
| Assertion | Typical procedure | Typical misstatement |
|---|---|---|
| Occurrence | Vouch recorded sales to dispatch and customer acceptance | Fictitious or premature sales |
| Completeness | Trace dispatch records to invoices; analytical review of sequence | Unbilled shipments, unrecorded liabilities |
| Accuracy | Recompute price x quantity; agree to rate list | Wrong price or tax rate |
| Cut-off | Test last and first days' dispatches against period end | Next-year sales booked this year |
| Classification | Review account coding and mapping | Capital item expensed, or reverse |
| Existence | Confirmations, physical inspection | Balance for an asset or debtor that is not there |
| Rights and obligations | Title documents, agreements | Pledged or third-party assets shown as own |
| Valuation and allocation | Ageing and recoverability review, recomputation | Under-provided doubtful debts |
| Presentation | Check against Schedule III and Ind AS or AS disclosure checklist | Incorrect aggregation, missing note |
Common confusion
Existence versus occurrence. Existence is about a balance at a date: does the debtor balance exist? Occurrence is about a transaction in the period: did the sale happen? A debtor can exist at year end for an old sale and still have a transaction that did not occur this year.
Completeness versus cut-off. Completeness asks whether everything that should be recorded is recorded. Cut-off asks whether it is recorded in the right period. A sale booked in April that belongs to March is complete in the year's total but wrong in period.
Direction of testing. Occurrence and existence test from the books to the evidence (overstatement). Completeness tests from the evidence to the books (understatement).
Worked example: revenue
Invented facts. Tarang Textiles Ltd, revenue ₹62 crore. Risk: premature recognition at the March year end (presumed fraud risk in revenue under SA 240).
- Occurrence: select 25 invoices over ₹10 lakh and trace each to the customer order, dispatch note and transporter receipt. Finding: 1 invoice (₹14 lakh) dated 31 March has a lorry receipt dated 3 April.
- Cut-off: examine the last 5 and first 5 working days. The above invoice is a cut-off error, so revenue is overstated by ₹14 lakh.
- Completeness: trace 25 dispatch notes for the last week to invoices; all billed.
Worked example: trade receivables
Same entity. Trade receivables ₹9.8 crore, 140 parties.
- Existence: send confirmations to 12 parties covering ₹4.1 crore. Eight reply, agreeing ₹2.7 crore. For the other four (₹1.4 crore), perform alternative procedures: subsequent receipts and dispatch documents. Subsequent receipts clear ₹1.0 crore; ₹0.4 crore remains unsupported.
- Valuation: ageing shows ₹1.2 crore over 180 days; provision made is ₹0.3 crore. The auditor tests recoverability party by party and challenges the gap.
- Rights and obligations: ₹1.5 crore is assigned under a factoring arrangement with recourse, which needs to be considered for presentation.
Checklist
- List significant classes, balances and disclosures.
- For each, write the assertion that is most at risk.
- Tie each to a procedure in the audit programme.
- Test in the right direction.
- Record exceptions by assertion so that evaluation of misstatements is clear.
For the response side, see the SA 330 test of controls example.
Frequently asked questions
How many assertions are there?
It depends on how they are grouped. SA 315 (Revised 2019) as read in the international text lists six for transactions and six for balances, with disclosure aspects covered within them.
Is accuracy the same as valuation?
No. Accuracy is arithmetical and data correctness for transactions. Valuation and allocation concerns whether a balance is at an appropriate amount, which includes estimates.
What is the difference between SA 315 and SA 500 on assertions?
SA 315 uses assertions to identify and assess risks of material misstatement. SA 500 uses them in deciding what evidence is relevant and reliable.
Do I need to test every assertion for every balance?
No. Test those relevant to the risk. Not every assertion is relevant to every account.
What is cut-off?
Whether transactions and events are recorded in the correct accounting period.
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