Forms of evidence, Auditing

Assignment Help:

Forms of Evidence

  • Observation, is mostly witnessing internal book-keeping procedures and system control. It involves attendance at wages pay out. Observation of stock-take, opening of receipting and mail and issuing procedures on the stores warehouse.
  • Inspection: examining of physical assets to confirm their condition and their existence such an aid in determining their significance for accounts purposes. Perhaps it includes examining the records to ensure which internal control procedures have been carried out and book-keeping.
  • Testimony from independent third parties. These are obtaining bank letters, debtor's circulation, lawyer's letters etc.
  • Review of authoritative documents: like as e.g title deeds, loan and share certificates, contract, leases, supplier's invoices, , internal sales invoices and minutes of board meetings.
  • Testimony from employees and management: This can be formal e.g. a letter of informal or representation for example replies to questions in questionnaires.
  • Satisfactory internal control: Whether the volume of transaction is large for example sales, wages and salaries, purchases, receipts and payments so this may be the most require evidence.
  • Calculations performed through the auditor: These provide him evidence of the correctness of many figures.
  • Review of post balance sheet events: In most cases the final audit is performed well after the finish of the year and although the present is a function of the future many assertions can be verified through reference to subsequent events.
  • Relationship evidence: Evidence confirming truth concern one item may confirm the truth regards another, for example verifying the expense rates confirms to several extent ownership and existence of the property.
  • Agreement along with expectation: comparison and computation of ratios and absolute magnitude along with those achieved in the past, through other companies, or else budgeted can assist in confirmation. Inconsistencies, odd else abnormal or unexpected items also that can alert the auditor.
  • External events: The auditor has to consider external events in requiring his knowledge of current events to assist him in the assessment of such company's accounts. Therefore he must consider prevailing economic circumstances which affect his client; so he must consider the political legislation and situation also.

Related Discussions:- Forms of evidence

How is a hospitality firm valued, Firm valuation refers to the total value ...

Firm valuation refers to the total value of a firm in the capital market. It is the stock price of a firm times its outstanding shares. Total value of a firm is also called market

Meaning of the auditing definition, Meaning of the auditing definition a)...

Meaning of the auditing definition a) Orderly and efficient manner: An organization which is run in an orderly and proficient manner is able to satisfy the requirements o

Issues in audit of intangible assets, Issues in Audit of Intangible Assets ...

Issues in Audit of Intangible Assets The two key issues in such audit of intangible assets are: (a) Recognition of intangible assets The audit problem here is to mak

Steps in critical thinking principle, Step 1: Determine learning objective...

Step 1: Determine learning objectives. Considering the importance of a course, its placement in a program of study, and its role in providing a base of knowledge to be built upon

What method would you use to test an individual account bal., You are audit...

You are auditing the accounts receivable balance of a cable television provider. Individual accounts receivables tend to be similar in amount to each other and cover one or two mon

Computerized accounting practise, You are just appointed as the Trainee Acc...

You are just appointed as the Trainee Accountant of the Compaq Computing Sdn Bhd - the newly established company. The manager is facing difficulties in maintaining the manual accou

How do internal auditors add to the credibility of financial, How do intern...

How do internal auditors add to the credibility of financial statements?

Auditors procedures - disclosure and presentation, Auditors Procedures - Di...

Auditors Procedures - Disclosure and Presentation 1) Ascertain that what steps the client uses to identify suppliers, selling on terms that reserve title by enquiry of those c

The accounting system, The Accounting System ISA 400 Risk Assessment an...

The Accounting System ISA 400 Risk Assessment and Internal Control accounting system are the sequence of tasks and records of an entity by which transactions are procedure as a

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