Belarus Auditor Qualification Examination flashcards

31 cards. Read the term and the definition here. The deck at the top of this page is optional.

Mandatory audit

A statutory obligation for specified entities, such as joint-stock companies and organizations exceeding revenue or asset thresholds, to have annual financial statements audited.

Audit report

The formal written output of an audit engagement in which the auditor expresses an opinion on whether financial statements are presented fairly in all material respects.

Auditor independence

The state of being free from relationships or interests that could compromise objective judgment, required in fact and in appearance under law and ethics rules.

Accounting equation

The fundamental identity Assets = Liabilities + Equity, which must hold after every recorded transaction in a double-entry system.

Accrual basis

A method of accounting in which revenues are recognized when earned and expenses when incurred, regardless of the timing of cash receipts or payments.

Net realizable value

The estimated selling price of inventory in the ordinary course of business less the estimated costs of completion and costs necessary to make the sale.

Depreciation

The systematic allocation of the depreciable amount of a non-current asset over its useful life using a chosen method such as straight-line or declining balance.

VAT standard rate

The general rate of value added tax applied to taxable supplies in Belarus, set at 20 percent, with reduced and zero rates for specified cases.

Profit tax rate

The standard rate of tax on taxable profit of organizations in Belarus, set at 20 percent unless a special tax regime applies.

Tax residency

The status of an individual present in Belarus for at least 183 days in a calendar year, which determines the scope of taxation of worldwide income.

Deductible expenses

Costs that reduce taxable profit because they are documented, economically justified, and incurred in connection with income-generating activity.

Limitation period

The general three-year period within which a party may seek enforcement of a violated civil right through court or arbitration.

Labor contract

A written agreement between employer and employee specifying position, wage, working hours, and leave, and governing their mutual rights and obligations.

Legal entity

An organization that owns separate property, bears liability for its obligations, and acquires civil rights and duties through its governing bodies.

Audit risk model

The relationship audit risk = inherent risk × control risk × detection risk, used to plan the nature, timing, and extent of audit procedures.

Materiality

The threshold amount of misstatement that could influence economic decisions of users, used to plan procedures and evaluate uncorrected misstatements.

Sufficient appropriate evidence

Audit evidence that is adequate in quantity and relevant and reliable in quality to support the auditor's conclusions and opinion.

Modified audit opinion

An opinion that is qualified, adverse, or a disclaimer, issued when the auditor concludes the financial statements are materially misstated or evidence is insufficient.

Going concern assumption

The presumption that the entity will continue in operation for the foreseeable future, which the auditor must evaluate and report on when material uncertainty exists.

Engagement quality review

An objective evaluation of significant judgments and conclusions by a reviewer not part of the engagement team, required for listed-entity audits.

Self-review threat

A threat to independence arising when the auditor evaluates results of previous services, such as preparing records later audited by the same firm.

Confidentiality principle

The ethical duty not to disclose client information obtained during an engagement without proper authority, unless disclosure is required by law.

Continuing professional education

Mandatory ongoing learning that auditors must complete to maintain the knowledge and skills required for competent professional service.

Current ratio

A liquidity measure computed as current assets divided by current liabilities, indicating the ability to settle short-term obligations.

Quick ratio

A liquidity measure computed as current assets minus inventory, divided by current liabilities, excluding the least liquid current asset.

Return on equity

A profitability ratio computed as net profit divided by average equity, showing the return generated on owners' invested capital.

Asset turnover

An efficiency ratio computed as revenue divided by average total assets, indicating how intensively assets are used to generate sales.

Debt-to-equity ratio

A leverage measure computed as total liabilities divided by total equity, indicating financial risk borne by the entity.

Break-even point

The sales volume at which total revenue equals total costs, computed as fixed costs divided by contribution margin per unit.

Net present value

The sum of future cash flows discounted to present value minus the initial investment; a positive result indicates value creation.

Gross margin

A profitability ratio computed as revenue minus cost of sales, divided by revenue, measuring profitability before operating and other expenses.