Auditing and EthicsQuestion 5684 of 212
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14. Which of the following statement is incorrect with regard to written representations?

Options

AWritten representations are an important source of audit evidence.
BWritten representations are necessary information that the auditor requires in connection with the audit of the entity's financial statements.
CWritten representations not only provide necessary audit evidence, but also provide sufficient appropriate audit evidence on their own about any of matters with which they deal.
DWritten representations only provide necessary audit evidence but do not provide sufficient appropriate audit evidence on their own about any of matters with which they deal. (2 Marks) AUDITING AND ETHICS
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Correct Answer

✅ Option C — Written representations not only provide necessary audit evidence, but also provide sufficient appropriate audit evidence on their own about any of matters with which they deal.

All Options:

  • AWritten representations are an important source of audit evidence.
  • BWritten representations are necessary information that the auditor requires in connection with the audit of the entity's financial statements.
  • CWritten representations not only provide necessary audit evidence, but also provide sufficient appropriate audit evidence on their own about any of matters with which they deal. ✓
  • DWritten representations only provide necessary audit evidence but do not provide sufficient appropriate audit evidence on their own about any of matters with which they deal. (2 Marks) AUDITING AND ETHICS

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Detailed Solution & Explanation

To determine the incorrect statement regarding written representations, let's analyze each option in the context of auditing standards and practices.
Option A states that written representations are an important source of audit evidence. This is correct because written representations from management provide the auditor with direct information about the financial statements and the entity's operations, which is essential for the auditor to form an opinion on the financial statements.
Option B mentions that written representations are necessary information that the auditor requires in connection with the audit of the entity's financial statements. This is also correct as written representations cover various aspects such as the responsibility of management for the financial statements, the existence of any fraud or error, and other matters that are crucial for the auditor's opinion.
Option C suggests that written representations not only provide necessary audit evidence but also provide sufficient appropriate audit evidence on their own about any of the matters with which they deal. This statement is incorrect because while written representations are a necessary part of audit evidence, they are not always sufficient on their own. The auditor needs to consider other audit evidence as well, such as observations, confirmations, and physical inspections, to form a comprehensive opinion.
Option D states that written representations only provide necessary audit evidence but do not provide sufficient appropriate audit evidence on their own about any of the matters with which they deal. This statement is correct and aligns with auditing standards, which emphasize that while written representations are necessary, they are just one part of the broader set of audit evidence that the auditor must consider.
Hence, **Option C** is the correct answer.

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