Concept of Verification 

Concept of Verification 

Concept of Verification 

Verification means proving the correctness. One of the main work’s of an auditor is verification of assets and liabilities. It is the act or process of verifying: the state of being verified. Verification is the act of assuring the correctness of value of assets and liabilities, title and their existence in the organization. It is the comparison of two or more items, or the use of supplementary tests, to ensure the accuracy, correctness, or truth of the information. An auditor should be satisfied with the actual existence of assets and liabilities appearing in the balance sheet is correct. If the balance sheet incorporates the incorrect assets, both profit and loss account and balance sheet do not present true and fair views.

Joseph Lancaster says that verification of assets is a process by which the auditors substantiate the accuracy of the right-hand side of the balance sheet.

Arthur W. Holmes says that verification is the proof or accuracy of extension, footing, posting existence and ownership of assets.



  • The purpose of verification is to determine the health of financial statements.
  • The purpose is to certify ownership.
  • to ascertain the existence of assets.
  • to check that asset is free of any charge.
  • to detect fraud. The assets may be stolen or misused.
  • to note the arithmetical accuracy of the assets stated in the accounting books.
  • to see the possession of assets. The assets must be safeguarded.
  • to evaluate the ‘internal control.
  • to determine the recording method of assets and liabilities.
  • to examine the deprecation plans Of management.
  • to check the valuation of assets. The management values the assets.

To verify something is to make sure it’s correct or true, so verification is an action that establishes the truth of something. Thus, verification means to confirm the truth or accuracy and to substantiate. It is a process by which the auditor satisfies himself not only about the actual existence, possession, ownership and the basis of valuation but also ensures that the assets are free from any charge. While verifying the assets, an auditor should consider the following points:

  • Ensuring the existence of assets.
  • Acquiring the assets for the business.
  • Ensuring the proper valuation of assets.
  • Ensuring that the assets are free from any charge.


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