When auditing owners' equity, the realisable value objective is not applicable.

Question

Quizplus · Accepted Answer

The realisable value objective is applicable to the audit of assets, particularly inventory and receivables. It is not applicable to the audit of owners' equity. The audit of owners' equity focuses on verifying the accuracy and completeness of transactions related to equity accounts, such as share capital, retained earnings, and reserves. The realisable value objective is not relevant in this context.

When Auditing Owners' Equity, the Realisable Value Objective Is Not