Question

Performance of an analytical procedure requires use of information produced by the entity being audited (IPE).

Required: a. Whenever an auditor uses IPE in an audit procedure, the auditor must ensure that the information is reliable. According to auditing standards, when using IPE as audit evidence, what procedures should the auditor evaluate to determine whether the information is sufficient and appropriate for purposes of the audit? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answers and double click the box with the question mark to empty the box for a wrong answers.) check all that apply

• Determine the financial statement items or accounts and assertions affected unanswered

• Determine the nature, timing and extent of the population to be tested unanswered

• Determine the overall purpose and specific objectives of the Audit Data Analytic unanswered

• Obtain audit evidence about the completeness and accuracy of the information unanswered

• Evaluate whether the evidence is sufficiently precise and detailed for the auditor’s purposes unanswered

• Evaluate whether the preferred tools will work efficiently with the data unanswered

Answer 1

 

 

The last three options are the correct answers among the six choices that have been provided while the first three answers are wrong.

 

d • Obtain audit evidence about the completeness and accuracy of the information

e • Evaluate whether the evidence is sufficiently precise and detailed for the auditor’s purposes

f • Evaluate whether the preferred tools will work efficiently with the data

 

The auditor must obtain audit evidence about the completeness and accuracy of the information in order to determine whether it is sufficient and appropriate for purposes of the audit. The auditor must evaluate the completeness of the information by considering whether all of the transactions that should be included in the information are included. The auditor must evaluate the accuracy of the information by considering whether the information is free from material errors.

The auditor must also evaluate whether the evidence is sufficiently precise and detailed for the auditor’s purposes. The auditor must consider the sufficiency of the evidence by considering whether the evidence is sufficient to provide a reasonable basis for conclusions about the financial statement items or accounts under audit. The auditor must consider the detail of the evidence by considering whether the evidence is sufficiently specific to support the auditor’s conclusions.

Additionally, the auditor must evaluate whether the preferred tools will work efficiently with the data. The auditor must consider whether the tools are appropriate for the data set and whether the data set is of sufficient quality to produce reliable results.