AUDIT EVIDENCE AND INTERNAL CONTROL CONCEPTS EXAM UPDATED
FOR 2025 WITH 100% VERIFIED SOLUTIONS 2023-2025
Evidential Matter
Sufficient, competent evidential matter is to be obtained through inspection, observation,
inquiries, and confirmations to afford a reasonable basis for an opinion regarding the financial
statements under examination.
Management Assertions
Assertions about classes of transactions and events and related disclosures, for the period
under audit.
Occurrence
An assertion that transactions and events that have been recorded actually occurred.
Cutoff
An assertion that transactions and events are recorded in the correct accounting period.
Completeness
An assertion that all transactions and events that should have been recorded have been
recorded.
Classification
An assertion that transactions and events have been recorded in the proper accounts.
Accuracy
An assertion that amounts and other data relating to recorded transactions and events have
been recorded appropriately.
Authorization
An assertion that all transactions and events have been properly authorized.
Presentation
An assertion that transactions and events are appropriately aggregated or disaggregated and
clearly described.
Rights and Obligations
, An assertion that the entity holds or controls the rights to assets, and liabilities are the
obligations of the entity.
Accuracy, Valuation and Allocation
An assertion that assets, liabilities, and equity interests are included in the financial statements
at appropriate amounts.
Existence
An assertion that assets, liabilities, and equity interests exist.
Audit Procedures
Specific acts performed by the auditor to gather evidence to determine if specific audit
assertions are being met.
Audit Program
A set of audit procedures prepared to test audit objectives for a specific component of the
financial statements.
Quality of Audit Evidence
A measure of the quality of audit evidence, including relevance and reliability.
Relevance
Refers to whether the evidence relates to the specific audit objective being tested.
Reliability
Refers to the diagnosticity of the evidence; does the evidence signal the true state of the
assertion or audit objective?
General Factors for Assessing Reliability
Factors include independence of the source of the evidence, effectiveness of internal control,
auditor's direct personal knowledge, documentary evidence, and original documents.
Sufficiency of Audit Evidence
A measure of the quantity of audit evidence.
Greater Risk of Material Misstatement
Requires a higher quantity of audit evidence.
Higher Quality Audit Evidence
FOR 2025 WITH 100% VERIFIED SOLUTIONS 2023-2025
Evidential Matter
Sufficient, competent evidential matter is to be obtained through inspection, observation,
inquiries, and confirmations to afford a reasonable basis for an opinion regarding the financial
statements under examination.
Management Assertions
Assertions about classes of transactions and events and related disclosures, for the period
under audit.
Occurrence
An assertion that transactions and events that have been recorded actually occurred.
Cutoff
An assertion that transactions and events are recorded in the correct accounting period.
Completeness
An assertion that all transactions and events that should have been recorded have been
recorded.
Classification
An assertion that transactions and events have been recorded in the proper accounts.
Accuracy
An assertion that amounts and other data relating to recorded transactions and events have
been recorded appropriately.
Authorization
An assertion that all transactions and events have been properly authorized.
Presentation
An assertion that transactions and events are appropriately aggregated or disaggregated and
clearly described.
Rights and Obligations
, An assertion that the entity holds or controls the rights to assets, and liabilities are the
obligations of the entity.
Accuracy, Valuation and Allocation
An assertion that assets, liabilities, and equity interests are included in the financial statements
at appropriate amounts.
Existence
An assertion that assets, liabilities, and equity interests exist.
Audit Procedures
Specific acts performed by the auditor to gather evidence to determine if specific audit
assertions are being met.
Audit Program
A set of audit procedures prepared to test audit objectives for a specific component of the
financial statements.
Quality of Audit Evidence
A measure of the quality of audit evidence, including relevance and reliability.
Relevance
Refers to whether the evidence relates to the specific audit objective being tested.
Reliability
Refers to the diagnosticity of the evidence; does the evidence signal the true state of the
assertion or audit objective?
General Factors for Assessing Reliability
Factors include independence of the source of the evidence, effectiveness of internal control,
auditor's direct personal knowledge, documentary evidence, and original documents.
Sufficiency of Audit Evidence
A measure of the quantity of audit evidence.
Greater Risk of Material Misstatement
Requires a higher quantity of audit evidence.
Higher Quality Audit Evidence
