ICAEW ARF · Chapter 7 · Question 10 of 11
An auditor finds that evidence from a customer confirmation is inconsistent with the client's records. What should the auditor do?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Determine what changes or additions to audit procedures are needed to resolve the matter, and consider the effect on other aspects of the audit
Explanation
When evidence from different sources is inconsistent, the auditor must investigate further, for example by reviewing the customer account, cut-off and cash received, to find the cause. The inconsistency may indicate errors or fraud that also affect other areas. Neither source should simply be accepted, and individually small differences may still matter in aggregate or reveal a systematic problem.
More Assertions and audit evidence MCQs
- Q1In the context of audit evidence, what do the terms 'sufficient' and 'appropriate' refer to?
- Q2Which of the following sources of audit evidence about a company's bank balance is the most reliable?
- Q3An auditor selects items from the client's inventory records and physically inspects them in the warehouse. Which assertion does this…
- Q4During an inventory count, the auditor selects items on the warehouse floor and traces them to the final inventory listing. Which…
- Q5Which of the following procedures best tests the cut-off of sales?