Problem:
I agree that transparency in an organization's financial statements has become an important issue in the auditing world since the fall of Enron. According to a documentary I watched on the scandal, The Smartest Guys in the Room, one of the many issues with Enron was that the business they were doing with buying and selling of energy was so complicated that even the auditors didn't really understand it. If the financial statements aren't clear to the accountants, how is an investor supposed to understand them?
Transparency in the financial statements is one element that auditors look for when assessing Management Assertions about Presentation and Disclosure. What are the other assertions and why are they important to the auditing process?