Techniques of obtaining evidence, Auditing

Assignment Help:

Techniques of obtaining evidence

ISA 500 mentions them as:

(a) Inspection of records or documents,
(b) Inspection of tangible assets,
(c) Observation,
(d) Inquiry,
(e) Confirmation,
(f) Recalculation,
(g) Re-performance and
(h) Analytical procedures.

These can be further analyzed as follows:

(a) The physical examination: of tangible assets and counting them;

(b) Confirmation: These should be in writing, external sources being preferable to internal sources;

(c) Examination of original documents: Vouching should be carried out that is comparing original documents with entries in the books;

(d) Re-computation: This involves carrying out additions, calculations, extracting balances, rechecking postings and summaries.

(e) Scanning: This is useful in seeking the unusual or extra-ordinary item. It involves just flipping through the records and documents looking out for the odd items.

(f) Inquiry: This is asking questions of knowledgeable persons within and outside the entity. It is a necessary and valid technique.  Auditors however, prefer confirmation to oral answers.

(g) Correlation: This is seeking consistency in the records and in the accounts and using evidence obtained in other areas to provide additional assurance in other areas.

(h) Observation: Visual evidence is more satisfactory therefore, observing a procedure being performed is the best possible confirmation. However, observation has the drawback that you can only rely on it at the time you are observing. You can never be sure that the procedure is carried out that way all the time.


Related Discussions:- Techniques of obtaining evidence

Ethical dilemmas in business, Write a paper (may be real or fictional) invo...

Write a paper (may be real or fictional) involving Accounting and business moral dilemmas. The paper should be 13 pages (double spaced) in accordance with APA guidelines. more des

Briefly explain different types of audit, Government has recently set up a ...

Government has recently set up a parastatal body responsible for waste management in Mauritius. The management is unsure as to the need for an audit and the setting up of an intern

Non-statutory audits, Non-statutory Audits The non-statutory audits ar...

Non-statutory Audits The non-statutory audits are performed through independent auditors sicne the owners, proprietors, trustees, members  and governing and professional bodie

Co-operative societies, Co-operative Societies An audit in this case is...

Co-operative Societies An audit in this case is carried out as a normal audit except you should note that the auditor is appointed by the Commissioner of Co-operatives and alth

Discontinued operations - audit of accounting estimates, Discontinued Opera...

Discontinued Operations - Audit of Accounting Estimates A discontinued operation is a component of an entity that either has been disposed of or is held for sale. So it might

Factors affecting and controlling occupational health, Factors Affecting an...

Factors Affecting and Controlling Occupational Health (i) Walking-Working Surface Workers must work or move on different surfaces while working. Such - surfaces are cha

#first audit#, #what are the procedures of conducting audit for the first t...

#what are the procedures of conducting audit for the first time#

Which represents the largest number of common shares, Q. Which of the follo...

Q. Which of the following represents the largest number of common shares? a. Treasury shares b. Issued shares c. Authorized shares d. Outstanding shares

Standard defines development and research, Standard Defines Development and...

Standard Defines Development and Research The standard defines development and research as follows: (a) Research - planned and original investigation undertaken along with

Cash and window dressing - building society, Cash and Window Dressing - Bui...

Cash and Window Dressing - Building Society Cash Possibility of misappropriation and error usually accompany the handling of cash. Building societies transactions towards

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd