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    Question

    As per SA 500, the reliability of audit evidence is

    increased when it is:
    A Obtained from within the entity rather than from external sources. Correct Answer Incorrect Answer
    B Obtained indirectly by the auditor. Correct Answer Incorrect Answer
    C Oral rather than in document form. Correct Answer Incorrect Answer
    D Obtained from independent sources outside the entity. Correct Answer Incorrect Answer
    E Generated by the entity's own accounting department. Correct Answer Incorrect Answer

    Solution

    External evidence obtained directly by the auditor from independent sources is generally considered more reliable than evidence generated internally.

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