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    Question

    Refer to the following information to answer the next 4 questions (Q23 to Q26) Audit is the examination or inspection of various books of accounts by an auditor followed by physical checking of inventory to make sure that all departments are following documented system of recording transactions. It is done to ascertain the accuracy of financial statements provided by the organisation. Audit can be done internally by employees or heads of a particular department and externally by an outside firm or an independent auditor. The idea is to check and verify the accounts by an independent authority to ensure that all books of accounts are done in a fair manner and there is no misrepresentation or fraud that is being conducted. All the public listed firms have to get their accounts audited by an independent auditor before they declare their results for any quarter.

    ______ refers to the information collected by an auditor to ascertain the accuracy and compliance of a company's financial statements.

    A Investigation Correct Answer Incorrect Answer
    B Audit evidence Correct Answer Incorrect Answer
    C Working papers Correct Answer Incorrect Answer
    D Vouching Correct Answer Incorrect Answer
    E Verification Correct Answer Incorrect Answer

    Solution

    Audit Evidence refers to the information collected by an auditor to ascertain the accuracy and compliance of a company's financial statements. Audit evidence is information used by the auditor in arriving at the conclusions on which the auditor's opinion is based.  

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