Para 2.1.10 — MSO

Commonly used Audit Procedures

2.1.10 The principal source of evidence for audit conclusions will be the records of the auditee organisation. It is the primary duty of audit to ensure that the audit conclusions drawn about the organisation and various projects and programmes, activities, transactions, etc. subjected to audit are based on sufficient, competent and relevant evidence. Evidence must be planned, gathered and analysed before any conclusion can be reached. This may be gathered by:

(i) physical observation, including joint inspection by the auditors and the executive, the resultant observations being signed by both as confirmation of performance or achievements;

(ii) review of documents;

(iii) evaluation of the quality of internal control mechanisms; and

(iv) interviews with executives.

In auditing government accounts, evidence may not be obtained by making independent enquiries from private individuals or members of the general public. However, evidence may be gathered by enquiry from third parties through a reputed agency only when Audit is of the view that the evidence gathered directly from the auditee organisation is insufficient to arrive at proper conclusions. Audit should ensure that evidence obtained from deliberations or interviews with executives is documented and signed by both the participating audit personnel and executives.