RELIABILITY OF AUDIT EVIDENCE

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

Reason why audit evidence generated by external confirmation is more reliable.

Audit evidence can be obtained either through basic accounting records or documents obtained from third parties upon request by the auditor. This technique of obtaining information from the third part is normally referred to as direct confirmation.

The quality of audit evidence generated by direct confirmation is very high because:

  • It is obtained from independent external source and audit evidence
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Audit and assurance revision question NBAA May 2019.

Audit evidence can be obtained either through basic accounting records or documents obtained from third parties upon request by the auditor. This technique of obtaining information from the third part is normally referred to as direct confirmation.

REQUIRED:

(i) Discuss the quality of audit evidence generated by direct confirmation techniques, giving three examples where the techniques might be used.

(ii) … Read the rest