As per SA 500,factors affecting relevance are test of controls nd substantive procedures.. Didn\’t understand d well.. Kindly explain it sir.

1 answer

Ravi Staff February 23, 2017

Evidence is considered relevant
if it covers
1. it covers risk/purpose of audit procedure (for example when there is risk of understatement of creditors, focus should not be existing recorded creditors but creditors which are unrecorded as compared to last year or suppliers list)
2. it covers all assertions (you will understand it once you see video on SA 315)
3. it covers test of control of that area (you will understand test of control after watching core audit process video or sa 330 video)
4. it covers substantive tests of that area (you will understand substantive tests after watching core audit process video or sa 330 video)
so relevant basically means covering all required points. if evidence regarding purpose or assertion or test of control or substantive tests is not in our files we will consider it incomplete and relevant evidence is not available. 


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