Core concepts
- 01SA 500 — Sufficient appropriate audit evidence.
- 02Procedures: inspection, observation, external confirmation, recalculation, reperformance, analytical, inquiry.
- 03External confirmation (SA 505) more reliable than internal; written more than oral.
- 04Sampling (SA 530): statistical vs non-statistical; tolerable misstatement, sample size factors.
- 05Documentation (SA 230) — sufficient + appropriate; assembly within 60 days of audit report.
Flowchart summary
Audit Evidence Pyramid ^ / \ Most reliable: external + auditor obtained / \ / \ Inspection / Recalculation / Confirmation /-------\ / Inquiry only (least reliable alone) \ /___________________________________
Exam-critical pointers
- ⭐External confirmation — positive (response required) vs negative (only if disagreement).
- ⭐SA 540 — Audit of accounting estimates: management bias risk.
- ⭐Use of expert (SA 620) — auditor still responsible for opinion.
- ⭐Subsequent events (SA 560) — Type I (adjusting) and Type II (non-adjusting per AS 4 / Ind AS 10).
Make it click