Scenario assignment- Please follow the detailed instructions

Cheat Sheet on Evidence and Documentation

ACC/491

July 3, 2017

Cheat Sheet on Evidence and Documentation

Relevance, Reliability and Sufficiency of Evidence

The basic property of an audit report is that it should entail relevance. The report t should be written in a standard format which is usually mandated by generally accepting the set auditing standards. Accounting is an important task since it ensures financial details of a business are kept considerably clean. Going through the terminologies in order to know everything that is involved in auditing is important when auditing the financial records. The first step involves dividing the field into the foremost part known as the financial statement. Soares (1997). All businesses hold their financial statements in high regards since it is a legal requirement to provide and they provide them when they are requested by relevant bodies. These statements represent the picture of the business in reference to its financial robustness. The audited report reports are used to verify that the details given in their statements. For instance, the public corporations are supposed to ensure that their statements are professionally audited in order to secure their investors’ wealth.

It is important to note that the concept of reliability is of real interest to a wide variety of audit participants. This is due to many quotations and references that are required for well-founded financial information and the role of audit. It has been said that having a genuine financial and economic data should be the principle assumptions of a society. Being reliable increases confidence in and reliance on financial statements. Some of the aspects of reliability include faithful representation, fitness for purpose, robustness as well as the audit firm reliability.

The quantity of audit evidence is in simple words what sufficiency of audit evidence means. The risk of material and the inclusive quality of the evidence presented is what needs to be considered to fulfill the sufficiency needed. One should rely on an eloquent order other than the convincing one. Yang (2007). Impressive evidence shows the scale one way or the other and provides one with a basis beyond a sensible doubt for forming a viewpoint (Loughran, Maire, 2011). Convincing evidence is one which is perfectly reliable. It involves looking for all clients' records in order to achieve this level of assertion. Careful documentation of the work and the audit opinion must be fact-based and should be retractable so that a different review of the audit should depict the same conclusion (Loughran, Maire, 2011).

Confidentiality: Financial statements should be handled with confidentiality. Confidential information should not be disclosed to anyone. The accountant must protect the information from unauthorized disclosure or public release. The auditor should be accountable for any access by unauthorized people. In most times, clients see the auditors as trusted advisors. An audit document should be held in an electronic or paper format for keeping audit records. This is characterized by exceptions. The application of these policies and procedures is the use of Teammates. The auditor is supposed to respect and ensure the confidentiality of information acquired and he should not disclose this information to anyone without authority from the authority. This is usually stated in the constitution.

Conclusion

The main goal of this cheat sheet is to obtain fair-minded assurance as to whether the financial statements are free from material inaccuracy. This is to ensure that the auditor can express an opinion on the financial statements and report accordingly in the auditor’s report. The main duty of an auditor is to obtain and evaluate the audit proof. This is usually undertaking from audit procedures carried out during the auditing process.

References

ACCA. (2011). Legal ownership of, and rights of access to, books. Retrieved from http://www.accaglobal.com/content/dam/acca/global/PDF-members/2012/2012l/Legal_ownership.pdf

Arens, Elder, & Beasley (2014). Auditing and Assurance Services, 15/E. Prentice Hall.

CPlusglobal. (2014). monetary unit sampling. Retrieved from http://cplusglobal.wordpress.com/2014/04/15/monetary-unit-sampling-mus/

Hall, T. W., Higson, A. W., Pierce, B. J., Price, K. H., & Skousen, C. J. (2013). Current Issues in Audit Sampling: Haphazard Sampling: Selection Biases and. American Accounting Association, 7(2), 16-22. Retrieved from http://aaajournals.org/doi/pdf/10.2308/ciia-50568?code=aaan-site

Loughran, M. (2010) Collecting and Documenting Audit Evidence, in Auditing for Dummies®, Wiley Publishing, Inc., Hoboken, NJ, USA. doi: 10.1002/9781118269268.ch6

Soares, C. (1997). Advances in safety and reliability: proceedings of the ESREL'97, international conference on safety and reliability, 17-20 June 1997, Lisbon, Portugal. Oxford, England New York: Pergamon.

Yang, G. (2007). Lifecycle reliability engineering. Hoboken, N.J: Wiley.