Question

Two overriding considerations affect the many ways an auditor can accumulate evidence:

1. Sufficient appropriate evidence must be accumulated to meet the auditor's professional responsibility.
2. Cost of accumulating evidence should be minimized.

In evaluating these considerations:
A) the first is more important than the second.
B) the second is more important than the first.
C) they are equally important.
D) it is impossible to prioritize them.

Answer 1

In the context of an audit, while both gathering sufficient appropriate evidence and minimizing costs are important, the former is more important as it directly impacts the auditor's ability to meet professional obligations and provide a reliable report.

Step-by-step explanation:

The subject in question pertains to the audit process in which an auditor accumulates evidence to support their findings. There are two overriding considerations in this process. The first consideration is that the auditor must gather sufficient appropriate evidence to meet their professional responsibility. This is imperative to ensure that the conclusions of the audit are well-founded and can be relied upon. The second consideration involves the cost of accumulating evidence, which should be minimized to maintain the efficiency and cost-effectiveness of the audit process.

When evaluating these considerations, the priority is to ensure that sufficient appropriate evidence is accumulated (Option A). This is necessary to fulfill the auditor's professional obligations and to provide a reliable audit report. The minimization of evidence accumulation costs must be balanced against the requirement to obtain sufficient evidence. Therefore, while cost concerns are important and should not be ignored, the adequacy and appropriateness of the evidence ultimately take precedence.