bea2004 slides unit 6 audit evidence

Audit evidenceISA (UK & I) 500 requires the auditor to obtain ‘sufficient appropriate audit evidence to be able to draw reasonable conclusions on which to base the audit opinion’For this purpose ‘audit evidence’ is ‘all the information used by the auditor in arriving at the conclusions on which the audit opinion is based’Audit evidenceAs such it includes:• information contained in the accounting records• audit evidence obtained from procedures conducted during the course of the audit• audit evidence obtained from other procedures, for example previous audits, client acceptance procedures etc1Audit evidenceThe standard distinguishes between the ‘sufficiency’ of audit evidence – a measure of the quantity of evidence and ‘appropriateness’ – which reflects the relevance and reliability of the evidence in terms of ‘providing support for, or detecting misstatements in, the classes of transactions, account balances and disclosures and related assertions’Audit evidenceThe standard notes that the reliability of audit evidence is influenced by its source, its nature and the circumstances under which it is obtained – but, with caveats, makes the following general assertions as to the reliability of evidence2Audit evidence• Audit evidence is more reliable when it is obtained from independent sources outside the entity - a supplier’s statement may be stronger evidence of the amount of the relevant liability than the purchase ledger balance- ...