Identify two management assertions of the interest expense

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In the audit of Kleenup Ltd you perform extensive ratio and trend analysis. No material exceptions are discovered except that the interest expense has decreased by 6.49% from the previous year. You note that the audit client extended their debt by $12 million in the current year to finance a new project.

Required:

Problem 1: Identify two management assertions of the interest expense account that could be misstated, and briefly provide one example of how each assertion could be misstated. An example is provided to illustrate the requirement. Please note that this example is unrelated to the question and is provided for illustrative purposes only.

Example: "Occurrence - Sales can be overstated by recording sales that belong to the next accounting period in the current accounting period"

 

Reference no: EM132944863

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