ICAEW ARF · Chapter 7 · Question 2 of 11
Which of the following sources of audit evidence about a company's bank balance is the most reliable?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) A confirmation sent by the bank directly to the auditor
Explanation
Evidence obtained directly by the auditor from an independent external source is generally the most reliable. A photocopy supplied by the client could have been altered, oral statements are less reliable than written evidence, and a client-prepared reconciliation is generated internally. The bank reconciliation still needs testing, but the confirmation provides the strongest evidence of the balance.
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