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2010F8 CH8 introduction to au [1]...

2010F8 CH8 introduction to au [1]... -...

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Part C :Planning and risk   assessment 6 risk assessment 7 audit planning and documentation 8 introduction to  audit evidence
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2 CH8 introduction to audit  evidence Topic list Audit evidence FS assertions ISA500  A E
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3 1 audit evidence  1.1 the need for audit evidence Key term:  A E is all of the information used by the auditor in  arriving at the conclusions on which the auditor’s  opinion is based  includes: the information contained in the accounting records …,  and  Other information gathered by the auditors… The extent of A E :  Auditors are not expected to look at all the information Their will often select samples to test 
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4 1 audit evidence  1.2 sufficient, appropriate audit  evidence Key term: Appropriateness: quality-----relevance & reliability Sufficiency: quantity----risk , quality Relationship:   If E is high quality…may need less than poor…; A high quantity of poor quality E will not cancel out  its poor quality.
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relevance Relevance: logical connection with the  purpose of the audit procedure and the  assertion The evidence gathered must cover the  FS assertions
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quality or reliability… External auditor Entity ---------Control effective Written originals
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Sufficient  ----- � Sufficiency : …quantity…to support the audit opinion The quantity is affected by  factors : Risk assessment Nature of accounting and internal control systems Materiality of the item Experience gained during previous audits Results of audit procedures Source and reliability of information available
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