Question 2
Domain 2 — AI Operations, Lifecycle, and Control EnvironmentWhich type of audit evidence is generally considered MOST reliable in supporting audit conclusions?
Correct answer: A
Explanation
Physical evidence and documentation obtained directly by the auditor are most reliable because they are obtained from independent, firsthand procedures such as "reperformance or inspection." Audit evidence is stronger when it is directly observed or verified by the auditor rather than relying on oral representations or indirect sources.
Why each option is right or wrong
A. Physical evidence or documentation obtained directly by the auditor through reperformance or inspection
Under ISA 500, audit evidence is more persuasive when it is obtained directly by the auditor from independent sources and through direct procedures such as inspection, observation, recalculation, or reperformance. Evidence created or verified firsthand is less susceptible to management bias or alteration than oral explanations or internally generated assertions, so it carries the highest reliability in supporting audit conclusions.
B. Verbal inquiry responses from experienced and knowledgeable management
C. Written management representations confirming control effectiveness
D. Second-hand testimonials from operational staff about past procedures