- 1 Marks
AA – L2 – SA – Q3.7 – Evidence Reliability
Question
Which one of the following types of evidence is the most reliable?
A The client’s sales invoices
B Report obtained from a client’s bank confirming balances
C The written representation letter
D Confirmation during a telephone call with the Managing Director that there are no loans outstanding
Answer
B
Explanation: External evidence from a bank (B) is most reliable due to its independence and objectivity. Client invoices (A) and representation letters (C) are internal, less reliable. Verbal confirmation (D) lacks documentation, reducing reliability. Thus, B is correct.
- Tags: Audit Evidence, Bank Confirmation, ICAG, Reliability
- Level: Level 2
- Topic: Audit and Assurance Evidence
- Uploader: Salamat Hamid