1.
attorney letter: a communication sent from the client to the attorney that details a list of pending litigation, claims, and assessments involving the client. the attorney is requested to comment in these matters directly to the client's auditors
2.
audit completion date: the date on which auditors have gathered sufficient appropriate evidence on which to base their opinions on the financial statements and internal control over financial reporting
3.
audit report release date: the date on which auditors allow the client to use auditors' reports in conjunction with the financial statements; this is also the date which the client's financial statements are issued
4.
contingency: an existing condition involving uncertainty as to possible gain or loss to an enterprise that will ultimately be resolved when one or more future events occur or fail to occur
5.
dual date: to provide two dates to which auditors limit the responsibility beyond the audit completion date to a specific subsequent event identified in the report
6.
engagement quality review: a review of audit documentation by an additional person who has not been involved with the audit
7.
individuals charged with governance: people responsible for overseeing the client's financial reporting process, including the internal control over financial reporting. typically it is the audit committee
8.
iron curtain method: when evaluating the effect of uncorrected misstatements, this method considers the aggregate effect of current and prior misstatements in the entity's balance sheet
9.
management letter: a summery of recommendations made by auditors resulting from the audit engagement that allow the client to improve the effectiveness and efficiency of its operations
10.
management representations: written assertions provided by management to auditors on matters such as the fairness of the organizations financial statements, availability of all financial records and data, internal control over financial reporting, and other important matters
11.
omitted procedure: situation in which a necessary audit procedure is not performed by the auditors prior to the audit report release date
12.
pro forma financial data: The presentation of financial statements "as if" some important event had occurred at the balance sheet date
13.
rollover method: when evaluating the effect of uncorrected misstatements, this method only considers the current period income effect of the potential adjustment
14.
subsequent discovery of facts: a situation in which auditors become aware of facts after the audit report release date
15.
subsequent event: an event occurring between the balance sheet date and audit report release date
16.
subsequent period: time period between the balance sheet date and the audit report release date
17.
type I subsequent event: a subsequent event that provides new information about a condition that existed at the balance sheet sate
18.
type II subsequent event: an event that did not exist at the balance sheet date but occurred prior to the audit release date
19.
unasserted claim: a representation that no formal lawsuit or claim has been filed or threatened on behalf of others but that circumstances such as a catastrophe, accident, or other physical occurrence could result in a suit or claim being filed in the future
20.
uncorrected misstatement: a misstatement that the auditor has identified and accumulated during the audit that has not been corrected or adjusted by the client
