Assertions and Related Control Activities for Long$-$Term Debt

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Assertions and Related Control Activities for Long$-$Term Debt

When a substantive strategy is followed, the auditor needs a sufficient understanding of the entity$$s internal control system over debt transactions to be able to anticipate the types of mis$$statements that may occur. When assessing the control risk for long$-$term debt, the auditor will focus on the general types of control activities that should be present to minimize the likelihood of material misstatement. The assertions for long$-$term debt that are of primary concern to the auditor include: $(1)$ occurrence and authorization, $(2)$ completeness, $(3)$ valuation, and $(4)$ presentation and classification.

Part $2$ Concept Check