Principle

Definitions

Sufficiency

Reliability

• provided by original documents rather than photocopies or faxes
• in documentary form, whether paper, electronic, or another medium, rather than verbal statements. However, correspondence, memos and reports may be incomplete, ambiguous or even incorrect, whilst interviews can provide an in-depth understanding not only of facts, but also of constraints and the environment. Nevertheless, evidence collected from interviews needs to be corroborated from other sources;
• obtained directly by the auditor (e.g. observation of the application of a control, computation) rather than indirectly (e.g. enquiry about the application of a control);
• obtained from independent sources outside the entity (e.g. confirmation received from a third party), as opposed to being generated within the auditee organisation or if the third-party is related to the auditee organisation;
• subject to effective related controls if internally generated, because strong internal controls within the auditee organisation can improve the quality of information obtained. Testing the auditee's internal controls over information, including
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  and
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  controls over computer-processed data can help in evaluating accuracy and completeness (
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  ) of such information.

Sources of evidence

Types of evidence

Corroboration

Relevancy

Instructions

Audit considerations

• High-quality evidence can lead to a reduction in the need for a large quantity of evidence; a large quantity of evidence can sometimes, but not always, be persuasive, even though individual pieces of evidence are not of high quality. However, merely obtaining more evidence does not compensate for its poor quality.
• The higher the combined level of inherent and control risks, the more persuasive evidence the audit team needs to obtain directly, e.g. through tests of details in financial and compliance audits. Similarly, the greater risk of making incorrect findings, reaching invalid conclusions, legal action, controversy or surprise from reporting an audit finding, the higher the standard of evidence needed.
• While the audit team can obtain some audit evidence by testing the database records (e.g. by computation or analysis), this alone is not persuasive enough as evidence on which to base an audit conclusion about the characteristics of the underlying transactions, and other procedures should also be used, e.g. inspection, observation, enquiry and confirmation.
• The higher the level of materiality in monetary terms or the significance of the audit finding, the higher the standard of evidence required.
• The auditor should balance the persuasiveness of evidence against the cost of obtaining it. At some point, the cost of obtaining more evidence will outweigh the improved persuasiveness of the total body of evidence.
• The auditor should consider the purpose for which the evidence will be used. A higher standard is required for evidence supporting
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  than for background information provided in the audit report.
• In performance audits, important facts are often not of an individual nature, but rather comprise several interrelated facts. The strength of the combined facts may be as important, or even more so, than the strength of the individual facts.
• Useful information may not always be documented, thus also necessitating the use of other approaches than documentary review.
• Whilst the physical evidence is usually the most persuasive, the auditors must be aware that their presence may distort what would normally occur, thus reducing the quality of the evidence.
• Oral evidence maybe important, as information obtained in this manner is up-to-date and may not be available elsewhere. However, information should be corroborated and statements confirmed if they are being used as evidence. Only on the rarest of occasions will the auditor accept information obtained in interviews to be reliable in its own right.

Access and procedures