1.59 Management Assertion. Your audit manager has asked you to explain the PCAOB assertions by using an account on the balance sheet at your audit client. For the accounts receivable account, please define each of the PCAOB assertions, using the accounts receivable account as a way to illustrate each assertion. You are encouraged to reference Exhibit 1.5 to help you answer this question.

EXHIBIT 1.5 Management Assertions ASB Assertions (2) PCAOB Assortions Assertions about Events and Transactions Assertions about Account Balances Assertions about Presentation and Footnote Disclosures Key Questions Exstence or occurrenc Occurrence Existence Occurrence Do the assets listed really exist? Did the recorded sales transactions really occur? Rights and obl Igations Rights and obligations Rights and obligations Does the company really own the assets? Are all legal responsibilities to pay the liabilities identified? Completenes so Completeness Completeness Completeness Are the financial statements (including footnotes) complete? Were all transactions recorded? Cutoff Are transactions included in the proper period? Valuation or al location Accuracy Valuation and allocation Accuracy Are the accounts valued correctly? Valuation and allocation Are expenses allocated to the period(s) that were benefited? Presentation a nd disclosur OD Classification Classification Were all transactions recorded in the correct accounts? Understandability Are the disclosures understandable to users? EXHIBIT 1.5 Management Assertions ASB Assertions (2) PCAOB Assortions Assertions about Events and Transactions Assertions about Account Balances Assertions about Presentation and Footnote Disclosures Key Questions Exstence or occurrenc Occurrence Existence Occurrence Do the assets listed really exist? Did the recorded sales transactions really occur? Rights and obl Igations Rights and obligations Rights and obligations Does the company really own the assets? Are all legal responsibilities to pay the liabilities identified? Completenes so Completeness Completeness Completeness Are the financial statements (including footnotes) complete? Were all transactions recorded? Cutoff Are transactions included in the proper period? Valuation or al location Accuracy Valuation and allocation Accuracy Are the accounts valued correctly? Valuation and allocation Are expenses allocated to the period(s) that were benefited? Presentation a nd disclosur OD Classification Classification Were all transactions recorded in the correct accounts? Understandability Are the disclosures understandable to users