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Exam 2 short answers - SHORT-ANSWER QUESTIONS 1(4 points...

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SHORT-ANSWER QUESTIONS: 1. (4 points) Auditors are required to obtain sufficient, appropriate audit evidence to form a reasonable basis for their audit opinion. a. Identify the distinct elements that contribute to the (1) sufficiency and (2) appropriateness of audit evidence. b. How do the scope of audit procedures relate to these elements of audit evidence? a. Sufficiency corresponds with the quantity of evidence obtained and appropriateness corresponds with the quality of evidence obtained. The quality of audit evidence is determined by its: (a) relevance and (b) reliability. b. The scope of audit procedures entail three elements: (1) nature; (2) timing; and (3) extent. The nature of audit procedures relate to the quality of audit evidence to be obtained (most specifically to the relevance of that evidence in supporting a particular management assertion). The timing of audit procedures also relate to the quality of audit evidence to be obtained (procedures performed more closely to year-end provide more reliable evidence). Finally, the extent of audit procedures relate to the quantity of audit evidence obtained. 2. (4 points) Audit working papers (e.g. documentation) are an important part of an audit performed in accordance with Generally Accepted Auditing Standards (GAAS).
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