2-nature of evidence

Question 1

assertions are

Answer 1

implicit or explicit statements of fact by management associated with their financial statements

Question 2

auditors basis for conclusions are based on 3 auditing procedures

Answer 2

risk assessment procedures-to obtain and understanding of the environment, entity including internal control.

test of controls-to obtain info about operating effectiveness of controls in preventing or detecting material misstatement at the relevant assertion level.

substantive procedures- to detect material misstatement at the relevant assertion level

Question 3

basic responsibility

Answer 3

the auditor must plan and perform substantive procedures to be responsive to the assessed risks of material misstatement.

three decisions the auditor has to make dealing with

nature-should be responsive to the planned level of dr. test of details and substantive analytical procedures

timing - at interim or final. performing interim increases detection risk

extent-determine effect on sample size

of those procedures