Audit Evidence

For the purpose of auditing accountants need to find evidence through testing processes, transactions account balance etc to support finding in audit’s report. The ISA 500 Audit Evidence outlines that the auditor should obtain appropriate audit evidence to develop a reasonable judgement on which to base the audit opinion.

In order to do so, the ISA 500 has stated the two categories, Quantity and Quality. Quantity refers to whether there is an adequate level of information available to support the auditing. Some of the factors of quantity include:

  • Risk assessment
  • Nature of accounting and the internal control systems
  • The results of audit procedures
  • Materiality of items
  • Source and reliability of information available

In terms of quality, this is classed into two sections, relevancy and reliability. Relevancy includes gathering evidence that cover financial statements. Whilst reliability refers to the ability of auditors to obtain evidence that is trustworthy and is from a dependable source.