Account balance assertions apply to the balance sheet items, such as assets, liabilities, and shareholders’ equity.
There are four types of account balance assertions:
● Existence: The assets, equity balances, and liabilities exist at the period ending time.
● Completeness: The assets, equity balances, and the liabilities that are completed and supposed to be recorded have been recognized in the financial statements.
● Rights and Obligations: The entity has ownership rights or the right to benefit from recognized assets on the financial statements. Liabilities recognized in the financial statements represent the actual obligations of the entity.
● Valuation: The assets, equity balances, and liabilities have been valued appropriately.
