Question

Generally, a written representation _______.

A. is sufficient evidence to issue an unmodified audit report.
B. complements other audit procedures that were performed and generally does not provide sufficient appropriate audit evidence on its own.
C. replaces other audit procedures that were performed and generally does provide sufficient appropriate audit evidence on its own.
D. should be drafted by the client's legal counsel and signed with the auditor.

Answer 1

A written representation should be drafted by the client's legal counsel and signed by the auditor to ensure accuracy and legality. This document is crucial for auditors as it provides evidence and confirmation of management's claims about the financial statements.

Step-by-step explanation:

Generally, a written representation should indeed be drafted by the client's legal counsel and signed by the auditor. This document serves as a formal statement or declaration regarding specific facts about the client's financial statements. The drafting by legal experts ensures the representation addresses all legal considerations and accurately reflects the client's position. The auditor's signature, on the other hand, confirms that they acknowledge and understand the representations made by the client which relate to the financial statements they are auditing.

Written representations are paramount in the auditing process. They are used to confirm certain elements of the audit, obtain additional evidence, and to provide a clear, sworn statement of management's beliefs regarding the financial statements. Essentially, these representations form an essential part of the evidence that an auditor will rely upon when forming their audit opinion. Therefore, using authorized representatives and ensuring due diligence in the creation and signing of such documents is integral to the audit process.