ISA 500

3 qualities of audit evidence

3 qualities of audit evidence.

Audit evidence is information needed by the auditor in order to reach the conclusion on whether financial statements show a true and fair view.
The qualities of good audit evidence are determined in relation to its relevance, reliability, and Sufficiency.

Relevance

Good audit evidence must be relevant to the matter and consideration which purport to answer. Audit evidence … Read the rest

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7 methods of obtaining audit evidence.

Audit evidence is information used by auditor to draw reasonable conclusion about financial statements on which auditor’s opinion is based. Audit evidence should be appropriate and sufficient.



The following are audit procedures of obtaining audit evidence;

Inquiry

Inquiry means seeking information from knowledgeable person inside or outside entity. Evidence from inquiry alone is not enough … Read the rest

Revision question on audit evidence (NBAA,B3,NOV 2018)

(a)    In accordance with ISA 501: Audit Evidence – Specific Considerations for Selected Items, outline what an auditor should do:

(i)    To obtain sufficient appropriate audit evidence regarding the existence and condition of inventory where inventory is material to the financial statements.

(ii)   Where physical inventory counting is conducted at a date other than the date of the financial statementsRead the rest

Audit substantive procedures for raw materials purchases.

Raw materials are materials or items used as inputs in the production of another more advanced or useful item. In order to manufacture a product manufacturing entities need to procure raw materials to do so. in almost all cases, purchases of raw materials are material to the manufacturing company. Therefore, the auditor needs to obtain sufficient and appropriate audit evidenceRead the rest