Why sufficient appropriate audit evidence not obtained

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Question - You are completing the audit of Salisbury Pty Ltd (Salisbury) for the year ended 30 June 20X0. While reviewing the working papers, you read the following note from the audit junior (Jim Short).

Two members of the audit team were absent from work because of illness on the days we tested accounts receivables. To assist us, Salisbury's senior accountant offered to help out with the debtor confirmations. I was glad to accept her offer because we were falling behind schedule. I gave her a blank copy of the confirmation letters and she filled in the details and posted them. Debtors replied directly to her, and she collated the responses and provided me with a report. I read the report, and noted that all balances had been confirmed. I concluded that the net value of accounts receivable recognised in the draft financial statements was fairly stated".

REQUIRED -

(i) Explain why sufficient appropriate audit evidence has not been obtained to support the conclusion reached by Jim Short.

(ii) Specify an alternative test that Jim should have undertaken to ensure he had sufficient appropriate audit evidence on which to base his conclusion.

Reference no: EM132738894

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