Auditing Questions

Evidence plays a critical role in auditing. Without quality evidence, auditors cannot arrive at the right conclusions about audit objectives. Evidence can be considered strong if it is persuasive. Persuasiveness, in turn, can be achieved if the evidence is relevant, sufficient, and competent. There is relevance if different results would generate different conclusions regarding the audit objective. There is sufficiency if there is enough evidence to arrive at a conclusion and there is competency if it is credible. When evaluating evidence, auditors may follow 11 guidelines, which focus on the issues of relevance, objectivity, documentation, externality, sample size, sampling method, corroboration, timeliness, authoritativeness, directness and adequacy of controls.

Every auditor needs to present quality evidence, but what makes it competent, relevant, and sufficient isn’t always clear. Eleven guidelines can help close the case.

Conduct research on the importance of the quality of evidence relied upon during an audit engagement. Why do you feel it is important to gather quality evidence?