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CS Professional · Compliance Management, Audit and Due Diligence · Audit Principles and Techniques

An auditor of Sahyadri Retail Ltd re-performs the company's reconciliation and analyses the ledgers, finding the accounting records internally consistent and agreeing to the financial statements. According to SA 500, what kind of source of audit evidence is this?

It is audit evidence obtained by performing procedures to test the accounting records. SA 500 describes analysis, review and reperformance of financial reporting procedures as sources, allowing the auditor to determine the records are internally consistent and agree to the financial statements.

  1. AEvidence obtained by performing audit procedures to test the accounting recordsCorrect
  2. BEvidence obtained only from external confirmations
  3. CEvidence from management's representations alone
  4. DEvidence that is not audit evidence at all

Explanation

SA 500 notes that some audit evidence is obtained by procedures testing the accounting records, such as analysis and review and reperforming procedures in financial reporting, through which the auditor may determine records are internally consistent and agree to the financial statements.

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