meaning of professional skepticism

What is professional skepticism?

Professional skepticism is an attitude that includes a questioning mind, being alert to conditions that may indicate possible misstatements due to fraud or errors, and a critical assessment of audit evidence.



In doing so, the auditor must always remain alert to a situation that may lead to misstatement in the financial statement. This means that the auditor must always find corroborative evidence to management representation and must not just believe what management tells him about issues during the audit.

Also when evidence contradicts each other, the auditor must make sure that he finds a clear explanation for the contradiction.



It does not matter how much the auditor trust the management auditor must make sure he obtains the corroborative evidence for their representation and he must critically assess other evidence presented to him. 
Professional skepticism is important due to the fact that sometimes some misstatements especially those caused by fraud are not easy to detect in the ordinary course of the audit.

2 thoughts on “What is professional skepticism?”

  1. Pingback: Threats to professional skepticism. – ACCOUNTING CLASS

  2. Pingback: Revision question on professional skepticism, impairment of goodwill, and procedures used to perform a forensic investigation. – ACCOUNTING CLASS

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