In auditing, valuation, allocation, and accuracy ensure what?

Valuation, allocation, and accuracy are key assertions in auditing that specifically pertain to ensuring that balances in financial statements are recorded at appropriate amounts. When an auditor evaluates these assertions, they are verifying that the values assigned to assets, liabilities, and equity are accurate and reflect the true economic situation of the entity being audited.

Valuation refers to determining the appropriate monetary amount associated with an asset or liability, ensuring it’s not over or under-stated. Allocation involves distributing the total amount to appropriate periods or categories in compliance with accounting principles, particularly for items like revenue and expenses. Accuracy ensures that the amounts are accurately recorded in the financial statements, reducing the risk of misstatements.

Together, these assertions create a framework for auditors to evaluate whether the reported financial figures truly represent the company's financial position, enabling informed decision-making by stakeholders.