Audit Evidence

AUDIT EVIDENCE

• ISA 500 defines audit evidence as all of the information used by the auditor in arriving at the conclusion on which the audit opinion is based. The standard also requires the auditor to obtain sufficient appropriate audit evidence to be able to draw reasonable conclusion on the financial statement.

• In an audit of financial statements, audit evidence will include the accounting records and document underlying the financial statements, as well as corroborating information from other sources.

• Sufficient Appropriate (persuasiveness) audit evidence

➢ Appropriateness

❖ Relevance; audit evidence should be depend on relevance to audit objectives.

❖ Reliability; reliability will depend on the nature and sources of audit evidence

➢ Sufficient

AUDIT WORKING PAPER

• ISA 230, Documentation (paragraph 2) states that “ the auditor should document matters which are important in providing evidence to support the audit opinion and evidence that the audit was carried out in accordance with ISAs”

• Documentation refers to the working papers prepared or obtained by the auditor in connection with the performance of audit.

• Purpose of working paper

❖ Facilitate the auditor in planning for current or future engagement.

❖ Facilitate the auditor in the supervision and review of the work done by assistants.

❖ Starting point for evaluation of staff competency and their training.

❖ To support the auditor in providing reasonable assurance that an adequate audit is conducted in accordance with the approved auditing standards.

❖ To provide the evidence to support the auditor’s opinion.

• Types of working papers

❖ Permanent files – contains historical information and information of continuing interest to the auditor that are still valid to support the current year audit work[pic]