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Auditing-Chapter 5
Auditing. Chapter Five. Evidence and Documentation.
17
Accounting
Undergraduate 4
05/09/2014

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Term
Accounting Records
Definition
The records of initial entries and supporting records, such as checks and records of electronic fund transfers; invoices; contracts; the general and subsidiary ledgers, journal entries, and other adjustments to the financial statements that are not reflected in formal journal entries; and records such as work sheets and spreadsheets supporting cost allocations, computations, reconciliations, and disclosures.
Term
Analytical Procedures
Definition
Evaluations of financial information through analysis of plausible relationships among both financial and nonfinancial data.
Term
Assetions
Definition
Expressed or implied representations by management regarding the recognition, measurement, presentation, and disclosure of information in the financial statements and related disclosures.
Term
Audit Documentation (Working Papers)
Definition
The auditor's principal record of the work performed and the basis for the conclusions in the auditor's report. It also facilitates the planning, performance, and supervision of the engagement and provides the basis for the review of the quality of the work by providing the reviewer with written documentation of the evidence supporting the auditor's significant conclusions.
Term
Audit Evidence
Definition
Information used by the auditor in arriving at the conclusions on which the auditor's opinion is based. Audit evidence includes both information contained in the accounting records underlying the financial statements and other information.
Term
Audit Procedures
Definition
Specific acts performed by the auditor in gathering evidence to determine if specific assertions are being met.
Term
External Confirmation
Definition
An external confirmation represents audit evidence obtained by the auditor as a direct written response to the auditor from a third party (the confirming party) in paper form or by electronic or other medium.
Term
Inquiry
Definition
Seeking information of knowledgeable persons, both financial and nonfinancial, within the entity or outside the entity.
Term
Inspection of Records and Documents
Definition
Examination of internal or external records or documents that are in paper form, electronic form, or other media.
Term
Inspection of Tangible Assets
Definition
Physical examination of the tangible assets.
Term
Observation
Definition
Process of watching a process or procedure being performed by others.
Term
Other Information
Definition
Audit evidence that includes minutes of meetings; confirmations from third parties; industry analysts' reports; comparable data about competitors (benchmarking); controls manuals; information obtained by the auditor from such audit procedures such as inquiry, observation, and inspection' and other information developed by, or available to, the auditor that permits the auditor to reach conclusions through valid reasoning.
Term
Recalculation
Definition
The auditor's checking the mathematical accuracy of documents or records either manually or electronically.
Term
Relevance of Evidence
Definition
The relevance of audit evidence refers to its relationship to the assertion or to the objective of the control being tested.
Term
Reliability of Evidence
Definition
The diagnosticity of evidence; that is, whether the type of evidence can be relied on to signal the true state of the assertion.
Term
Reperformance
Definition
The auditor's independent execution of procedures or controls that were originally performed as part of the entity's internal control, either manually or through the use of computer-assisted audit techniques.
Term
Scanning
Definition
Reviewing accounting data to identify significant or unusual items.
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