Techniques of obtaining evidence, Auditing

Techniques of Obtaining Evidence

ISA 500 mentions them as such:

  1. Inspection of documents or records,
  2. Inspection of tangible assets,
  3. Observation,
  4. Inquiry,
  5. Confirmation,
  6. Recalculation,
  7. Analytical procedures
  8. Re-performance.

These can be further analyzed as follows that:

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

b) Confirmation. Here these should be in writing, external sources to be preferable to internal sources;

c) Examination of original documents.  So vouching should be carried out which is comparing unique documents along with entries in the books;

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

e) Scanning: This is required in seeking the extra-ordinary or unusual item.  It includes just flipping with the documents and records looking out for the odd items.

f) Inquiry: This is asking questions of knowledgeable persons along within and outside the entity.  It is a valid and essential technique.  However auditors, prefer confirmation to oral answers.

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

h) Observation: Visual evidence is much more satisfactory therefore, observing a procedure being performed is the best possible confirmation.  However, observation has the draw back that you can only rely on it at the time you are observing.  You cannot be confident that the procedure is carried out which way all the time.

Posted Date: 1/24/2013 7:25:41 AM | Location : United States







Related Discussions:- Techniques of obtaining evidence, Assignment Help, Ask Question on Techniques of obtaining evidence, Get Answer, Expert's Help, Techniques of obtaining evidence Discussions

Write discussion on Techniques of obtaining evidence
Your posts are moderated
Related Questions
You are the external auditor of Apex tour Ltd, a company which promotes New Zealand tours to Australia and owns chain duty free shops. You have been auditing the company since it w

Fraudulent financial reporting Involves intentional misstatements or errors of amounts or disclosures in financial statements to mislead financial statement users. Fraudulent f

Contingencies and Provisions (i) Receive the client's schedule of provisions and seek and contingencies supporting documentation in the form of legal opinions, correspondence

discuss the verification procedure of current assets and long term liabilties

Ask You are the senior auditor assigned to the team performing an audit for Restorative Pharmaceutical Corporation (RPC), a 10-year-old publicly held corporation listed on the New

am happy to pay someone to do my acc assignment which is more auditing one

#Fortex Limited, the meat processing firm, was formed in 1985 from three smaller companies. In 1993, however, after a few years of spectacular growth, the company collapsed. a) S

Action if Management Refuses to Provide Representations If management refuses to provide a representation that the auditor considers essential, this constitutes a scope restric

An audit helps stay track of where the currency or money is going and makes sure the money is going anywhere it is believed to and not in someone''s pocket. An audit may also help

QUESTION: (a) The auditor should get relevant and reliable audit evidence sufficient to enable him to draw reasonable conclusions therefrom: (i) What do you understand by