In performing financial statement audits, auditors gather and evaluate audit evidence to form an opinion. Their opinion is whether the statements follow the proper criteria. Usually, the criteria are GAAP. Auditors should gather enough evidence to offer a basis for their opinion.

The ability to evaluate evidence appropriately is an important skill that an auditor must develop. Proper evaluation of evidence requires that the auditor understand the types of evidence that are available and the relative reliability. Various types of evidence may be gathered during the risk assessment procedures, test of controls, or substantive process. The type of evidence depends on the context in which the auditor applies it. Select 5 methods from the types of evidence list below to gather evidence and do the following:

• Describe the type of evidence.
• Provide an example of how the evidence could be used.

Types of evidence:

• Inspection of records or documents
• Inspection of tangible assets
• Observation
• Inquiry
• Confirmation
• Recalculation
• Reperformance
• Analytical procedures
• Scanning