CAF-8 · Chapter 15 · Question 9 of 10
If a written representation provided by management is directly contradicted by other reliable audit evidence gathered (e.g., management says a lawsuit is won, but the lawyer's letter says it is lost), what is the auditor's responsibility?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Perform audit procedures to resolve the inconsistency, and re-evaluate the integrity of management and the reliability of all other representations.
Explanation
If a representation contradicts other evidence, it raises severe doubts about management's honesty. The auditor must investigate the discrepancy and critically reassess whether they can trust any other statements management has made during the audit.
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