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
Business Risk Approach This approach requires the auditor to determine what are the very important business risks which the client faces. This line of approach both helps the c

(i) Overview of the audit process (a) Identify the key steps in this framework/ concept. (b) Briefly explain each of the key steps, in your own words. (ii) Framework of cr

what is the effect of fraud and error on the financial statement.please I want simple answer

e following situations involve a possible violation of the MIA ByLaws (on professional ethics, conduct and practice). For each situation, (1) decide whether or not the Code has bee

Develop an audit program to identify and reduce potential fraud using ACL.

if a proxy is voted as per his judgement other than member prescribed to him... what is the action to be taken?

Information in the Fixed Assets Register The register can obtain the following information: i. Fixed asset number. ii. The cost and the date of purchase. iii. Descrip

Dealings with Directors and Other Parties - Sundry Debtors and Loans Dealings along with directors and other related parties: The auditor's duties are follows as: i. The revi

State four factors considered determining sufficiency of audit evidence

Brand Names - Audit Process Few companies in current years have placed valuations on the brand names of the goods such they sell.  On the balance sheet the valuation is shown.