Audit Evidence, Procedures and Working Papers
Audit evidence must be sufficient (quantity) and appropriate (relevance and reliability). Reliability hierarchy: external evidence > internal; original documents > copies; evidence obtained directly by the auditor > indirect; documentary > oral. Procedures include inspection, observation, inquiry, confirmation, recalculation, re-performance, and analytical procedures. Inquiry alone is rarely sufficient.
Analytical procedures are required at planning (risk assessment) and in the overall review at completion; they are optional as substantive tests but useful for large volumes of predictable transactions. Substantive procedures include tests of details and substantive analytical procedures. External confirmations (ASA/ISA 505) require control over the confirmation process; non-responses require alternative procedures.
Working papers (ASA/ISA 230) must be sufficient for an experienced auditor with no prior connection to understand what was done, why, and what was concluded. Document the nature, timing, extent of procedures, results, and significant judgements. Retention periods apply (typically 5-7 years depending on jurisdiction).
Traps: assuming inquiry is sufficient evidence; treating internally generated evidence as equally reliable; failing to document significant judgements; and confusing the purpose of analytical procedures at different stages.
Rule of thumb: evidence obtained directly by the auditor from an independent external source is the most reliable. If you cannot document why a conclusion was reached, the working paper is deficient.