(Objective 7-4) The following are examples of documentation typically obtained by auditors:
1. Duplicate sales invoices
2. Subsidiary accounts receivable records
3. Vendors’ invoices
4. General ledgers
5. Title insurance policies for real estate
6. Notes receivable
7. Bank statements
8. Cancelled payroll checks
9. Cancelled notes payable
10. Payroll time cards
11. Purchase requisitions
12. Articles of incorporation
13. Receiving reports (documents prepared when merchandise is received)
14. Minutes of the board of directors
15. Signed W-4s (Employee’s Withholding Exemption Certificates)
16. Remittance advices
17. Signed lease agreements
18. Duplicate copies of bills of lading
a. Classify each of the preceding items according to type of documentation: (1) internal or (2) external.
b. Explain why external evidence is more reliable than internal evidence.
Objective 7-4
Identify and apply the eight types of evidence used in auditing.
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