![]() ![]() Auditors may re-perform specific tasks or processes to identify deficiencies and discover opportunities for further optimization. The auditors perform their own calculations to verify that the final account balances match those reported by the client. Auditors may reach out to third parties to verify the client’s financial information and accounting records. Auditors observe the client’s business processes and operations to identify deficiencies. Auditors collect evidence by inspecting physical assets, records, or documents. There are seven types of audit procedures, and the purpose of the procedure typically dictates which one is used: The latter includes tests of controls and substantive procedures. ![]() Those procedures are categorized as risk assessment procedures and audit procedures. How Is Audit Evidence Obtained?Īudit evidence is collected via audit procedures. Those statements contain an enormous amount of information that investors use to make decisions about whether to commit their money – so the completeness and accuracy of those financial statements is a high priority.Īny assertion the company makes about its financial performance must either be corroborated by outside evidence (such as a bank statement) or the auditors must perform their own analysis to verify the legitimacy of the information provided by the company. In particular, publicly traded companies must undergo an audit of their financial statements to investors every year. Second, if the findings from the audit are disputed, auditors will rely on the strength of the audit evidence to support their opinion. First, the opinion presented by an auditor after an audit is done depends on the evidence gathered.
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