Question

Of the following, which is the least persuasive type of audit evidence?

A. Confirmations mailed by outsiders to the auditors.
B. Copies of sales invoices inspected by the auditors.
C. Correspondence between the auditors and suppliers.
D. Canceled checks returned in the year-end bank statement directly to the client.

Answer 1

The least persuasive type of audit evidence is D. Canceled checks returned in the year-end bank statement directly to the client, as they have not been directly verified by the auditors and are more susceptible to manipulation. The correct answer is option D.

Step-by-step explanation:

The question concerns the persuasiveness of different types of audit evidence. In auditing, the persuasiveness of evidence refers to the quality and reliability of the evidence in supporting the auditors' opinions. Of the options presented, D.

Canceled checks returned in the year-end bank statement directly to the client is the least persuasive type of audit evidence. This is because these checks are returned to the client and not directly to the auditors, which means that their validity has not been independently verified by the auditors.

There is also an increased risk of the evidence being manipulated since it passes through the client's hands before reaching the auditors, compared to evidence like confirmations mailed by outsiders to the auditors or inspected documents like copies of sales invoices. The correct answer is option D.