Question

Which of the following statements relating to the competence of evidential matter is always true?

A) Evidence from outside an enterprise is always reliable.
B) Accounting data developed under satisfactory conditions of internal control are more relevant than data developed under unsatisfactory internal control conditions.
C) Oral representations made by management are not reliable evidence.
D) Evidence must be both reliable and relevant to be considered appropriate

Answer 1

The always true statement about the competence of evidential matter is that evidence must be reliable and relevant to be considered appropriate. Accounting data from a well-controlled environment and expert testimony are considered reliable forms of evidence when they meet the standards of impartiality and expertise.

Step-by-step explanation:

The question relates to the competence of evidential matter and its reliability in the context of auditing or business decision-making. Two important characteristics of good evidence in any field are reliability and relevance. Among the options provided, the statement that is always true regarding the competence of evidential matter is: Evidence must be both reliable and relevant to be considered appropriate. This means that for evidence to be considered competent, it must be trustworthy and directly tied to the matter being examined.

Accounting data developed under good internal control conditions are generally seen as more reliable because the controls in place reduce the chance of error or manipulation. Testimony, especially from experts or authority figures, can be powerful evidence. However, it must be considered within the context of whether the testimony is unbiased and based on informed knowledge. Measurements and case studies are assessed based on their validity and applicability across different scenarios, respectively.