Clarification and valuation are two important concepts in the field of auditing, specifically in the context of verification and valuation of assets and liabilities.

1. Clarification: Clarification refers to the process of seeking additional information or evidence from management or third parties to gain a better understanding or explanation of a particular item or transaction. It involves obtaining explanations, supporting documents, or other evidence to address any doubts or uncertainties that the auditor may have encountered during the verification process. Clarification helps the auditor to obtain a complete and accurate understanding of the item being examined.

2. Valuation: Valuation, on the other hand, refers to the process of determining the monetary worth or fair value of an asset or liability. It involves assessing the financial worth of an item based on relevant accounting guidelines, valuation techniques, and market conditions. The valuation process helps the auditor to determine whether the carrying value of an asset or liability is fairly presented in the financial statements.

In summary, clarification is focused on obtaining additional information or evidence to address doubts or uncertainties, while valuation is concerned with determining the monetary worth of an asset or liability. Both clarification and valuation are essential components of the verification and valuation process in auditing.