The
Definition Of

Meaning of verification

Meaning of verification is ‘proving the truth’, or ‘confirmation’. An auditor has not6 only to see the arithmetical accuracy and bona fides of the auditor has not only to see the arithmetical accuracy and bona fides of the transactions in the books of account by vouching only, but has also to see that the assets as recorded in the balance-sheet actually exist. The fact that there is an entry regarding the purchase of an asset and which entry has been found to be correctly recorded, is not a proof that the asset is in the possession of the concern at the date of the balance-sheet. It is possible that after the asset had been acquired and the necessary and no entry had been made regarding these facts in the books of account before the closing of the financial year. He has also to see whether a particular asset as recorded in the balance-sheet on the day of the closing of the books of account exists or not.

Share it:  Cite

More from this Section

  • Financing activities
    Financing activities refer to cash flow activities that include (a) Obtaining cash from issuing debt and repaying the amounts borrowed and (b) obtaining cash from stockholders...
  • Raw materials
    Raw materials are the basic goods that will be used in production but have not yet been placed into production.
  • Post-closing trial balance
    The post-closing trial balance is a list of permanent accounts and their balances after a company has journalized and posted of closing entries.
  • Controllable cost
    All costs and revenues are controllable at some level of responsibility within a company. This truth underscores the adage by the CEO of any organization that...
  • Market interest rate
    Market interest rate is the rate investors demand for loaning funds to the corporation.
  • Term and serial bonds
    Bonds that mature-are due for payment-at a single specified future date are term bonds. In contrast, bonds that mature in installments are serial bonds.
  • Corporation
    A business organized as a separate legal entity under state corporation law and having ownership divided into transferable shares of stock is a corporation.