Gathering Audit Evidence

Part of the Auditing For Dummies Cheat Sheet

While you work on your client’s audit, you gather sufficient appropriate evidence to come to a determination on whatever it is you’re auditing. The methods you use to gather audit evidence aren’t one-size-fits-all. Part of your obligation to exercise due professional care is to select the most appropriate method(s) for the type of client and auditing task at hand.

  • Analytical procedures: Comparing what’s on the client’s books to what’s expected to be on the books.

  • Confirmations: Asking for independent verification supporting management assertions.

  • Inspection of records: Asking the company for relevant documents in support of management assertions.

  • Observation: Watching the client’s employees do their jobs to obtain an understanding of how each job is done.

  • Recalculation: Verifying the mathematical accuracy of your client’s computations.

  • Reperformance: Doing the client’s accounting or internal control procedure to make sure the company is following its own rules.

  • Scanning: Looking over client transactions on the general ledger or other accounting reports.

  • Client tour: Checking to make sure all assets shown on the client’s balance sheet exist.

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