Chapter 5

Front 1

Accounting records

Back 1

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 records such as work sheets and spreadsheets supporting cost allocations, computations, reconciliations, and disclosures.

Front 2

Analytical procedures

Back 2

Evaluations of financial information made through analysis of plausible relationships among both financial and nonfinancial data

Front 3

Assertions

Back 3

Expressed or implied representations by management regarding the recognition, measurement, presentation, and disclosure of information in the financial statements and related disclosures.

Front 4

Audit documentation (working papers)

Back 4

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.

Front 5

Audit Evidence

Back 5

Information used by the auditor in arriving at the conclusions on which the auditor's opinion is based. This includes both information contained in the accounting records underlying the financial statements and other information.

Front 6

Audit procedures

Back 6

Specific acts performed by the auditor in gathering evidence to determine if specific assertions are being met

Front 7

confirmation

Back 7

This 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 media.

Front 8

Inquiry

Back 8

Seeking information of knowledgeable persons, both financial and nonfinancial, within the entity or outside the entity.

Front 9

Inspection of records and documents

Back 9

Examination of internal or external records or documents that are in paper form, electronic form, or other media.

Front 10

Inspection of tangible assets

Back 10

Physical examination of the tangible assets

Front 11

Observation

Back 11

Process of watching a process or procedure being performed by others.

Front 12

Other information

Back 12

Audit evidence that includes minutes of meetings; confirmations from third parties; industry analysts' reports; comparable data about competitors (benchmarking); controls manual; info obtained by the auditor from such audit procedures such as inquiry, observation, and inspection; and other information developed by, or available to, the auditors that permits the auditor to reach conclusions through valid reasoning.

Front 13

Recalculation

Back 13

The auditor's checking the mathematical accuracy of documents or records either manually or electronically

Front 14

Relevance of evidence

Back 14

This refers to its relationship to the assertion or to the objective of the control being tested.

Front 15

Reliability of Evidence

Back 15

The diagnosticity of evidence - that is, whether the type of evidence can be relied on to signal the true state of the assertion.

Front 16

Re-performance

Back 16

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.

Front 17

Scanning

Back 17

Reviewing accounting data to identify significant or unusual items.