DEFERRED TAX ASSETS Definition

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DEFERRED TAX ASSETS have an effect of decreasing future income tax payments, which indicates that they are prepaid income taxes and meet definition of assets. Whereas deferred tax liabilities have an effect of increasing future years income tax payments, which indicates that they are accrued income taxes and meet definition of liabilities.

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SLIT is Serial-Lot Item Tracking.

NONSAMPLING RISK is audit risk not due to sampling. An auditor may apply a procedure to all transactions or balances and fail to detect a material misstatement. Nonsampling risk includes the possibility of selecting audit procedures that are not appropriate to achieve a specific objective. For example, confirming recorded receivables cannot reveal unrecorded receivables. Nonsampling risk can be reduced to a negligible level through adequate planning and supervision.

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