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Which of the following is the least persuasive type of audit evidence?
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What is persuasive evidence in auditing?
Audit evidence is information obtained by the auditor to draw conclusions to support opinion on the Financial statements. Persuasive audit evidence will be those evidence which are good at persuading someone to do or believe something through reasoning or the use of temptation.
What is the most persuasive audit evidence?
Which of the following types of audit evidence is the most persuasive? Bank statements obtained from the client.
Why audit evidence is persuasive not conclusive?
In many cases the auditor has to rely on evidence which is only persuasive rather than conclusive. This is because generally it is difficult to obtain conclusive evidence. The auditor will verify ownership of land by inspecting title deeds. The auditor is not an expert on authentication of documents.
Which of the following types of evidence would an auditor consider the least reliable?
However, evidence collected from inquiry and observation is considered to be less reliable evidence. Thus, an auditor needs corroborative evidence such as written documents or data from financial records to come to an appropriate conclusion.
Which evidence is more reliable?
Evidence provided by original documents is more reliable than evidence provided by photocopies or facsimiles, or documents that have been filmed, digitized, or otherwise converted into electronic form, the reliability of which depends on the controls over the conversion and maintenance of those documents.
What is the meaning of pervasive in auditing?
ED-ISA 705 included the following definition of pervasive: “in the context of misstatements or an inability to obtain sufficient appropriate audit evidence, the term pervasive is used to describe the effects or possible effects on the financial statements of a matter that, in the auditor’s judgment, are not confined to …
What type of audit evidence would be considered the weakest type?
One of the weakest forms of audit evidence is management inquiry. Management inquiry is when the auditor simply asks management about an accounting transaction. While this is not an appropriate audit procedure on its own, it is useful when used with other procedures.
Why auditors can be persuaded only with a reasonable level of assurance rather than convinced that the financial statements are correct?
There are two primary reasons why the auditor can only be persuaded with a reasonable level of assurance, rather than be convinced that the financial statements are correct: 1. The cost of accumulating evidence. It would be extremely costly for the auditor to gather enough evidence to be completely convinced.
What are the factors that influence the reliability of audit evidence?
Factors that highly affect the reliability of audit evidence are:
- Source ; Source is evaluated based on its provider’s independence, objectivity, internal control’s strength and etc.
- Verifiability ; Such as Official Receipts with OR number, Particulars, date and company name and etc.
How do you write a persuasive document?
How to Write a Persuasive Document
- Carefully pick your topic and your approach to it.
- Define each of your arguments; plan how you will support them.
- Consider emotional appeals.
- Consider personal appeals.
- Address any counter-arguments.
- Plan an introduction.
- Consider the conclusion.
What is considered pervasive?
Pervasive means found everywhere or spread everywhere. A pervasive misstatement would be so serious that, to all intents and purposes the FS are useless. Similarly with a pervasive lack of sufficient appropriate audit evidence. Pervasive problems (leading to a disclaimer or and adverse opinion) are rare.
What are the different types of audit documentation?
Examples of audit documentation include memoranda, confirmations, correspondence, schedules, audit programs, and letters of representation. Audit documentation may be in the form of paper, electronic files, or other media.
What is documentary evidence in auditing?
Documentary evidence: Documentation is the auditor’s examination of the client’s documents that is should be included in the financial statements. Written presentation: Written presentations are the responses to inquiries by the auditor by the responsible person inside’ outside the organization.
What are two factors that determine the persuasiveness of audit evidence?
Two determinants of persuasiveness of evidence are:
- Competence – the degree to which evidence can be considered trustworthy.
- Sufficiency – amount of evidence is enough to form a reasonable opinion.
Why external evidence is more reliable than internal evidence?
External evidence is considered more reliable than internal evidencebecause external evidence has been in the hands of both the clientand another party, implying agreement about the information andthe conditions stated on the document.
What is sufficient audit documentation?
Audit documentation should be prepared in sufficient detail to provide a clear understanding of its purpose, source, and the conclusions reached. Also, the documentation should be appropriately organized to provide a clear link to the significant findings or issues.
Why is audit evidence persuasive rather than conclusive?
Audit evidence is persuasive rather than conclusive because of the following reasons: (i) The auditor gathers evidence on a test basis (the sample may or may not be representative). (ii) People make mistakes (both client and auditor). (iii) Documents could be forged (increasingly easy with digital technology).
What is evidence in auditing?
Evidence includes information that is highly persuasive, such as the auditor’s count of marketable securities, and less persuasive information, such as responses to questions of client employees. The use of evidence is not unique to auditors.
How is persuasive evidence collected?
The persuasive evidence is collected using a combination of sufficiency and appropriateness. The two are interrelated and apply to audit evidence that is collected either through substantive procedures or tests of control.
Does more audit evidence compensate for poor audit results?
However, merely obtaining more audit evidence may not compensate if it is of lower quality. There are some common ways of obtaining sufficient appropriate audit evidence to support the conclusion on the true and fair view of the financial statements. Auditors used different methods of collecting audit evidence.