The following five factors that influence the reliability of audit evidence are taken from ISA 500 Audit Evidence:
(i) Audit evidence is more reliable when it is obtained from independent sources outside the entity.
(ii) Audit evidence that is generated internally is more reliable when the related controls imposed by the entity are effective.
(ii) Audit evidence obtained directly by the auditor (for example, observation of the application of a control) is more reliable than audit evidence obtained indirectly or by inference (for example, inquiry about the application of a control).
(iv) Audit evidence is more reliable when it exists in documentary form, whether paper, electronic, or other medium. (For example, a contemporaneously written record of a meeting is more reliable than a subsequent oral representation of the matters discussed.)
(v) Audit evidence provided by original documents is more reliable than audit evidence provided by photocopies or facsimiles.
Other examples are:
(vi) Evidence created in the normal course of business is better than evidence specially created to satisfy the auditor.
(vii) The best-informed source of audit evidence will normally be management of the company (although management’s lack of independence may reduce its value as a source of such evidence).
(viii) Evidence about the future is particularly difficult to obtain and is less reliable than evidence about past events.
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