Statement on auditing standards, 031

              Statement on
Auditing Standards
Issued by the Auditing Standards Board
AICPA American Institute of
Certified Public Accountants
August 1980 31
Evidential Matter
( Supersedes Statement on Auditing Standards No. 1, section 330, " Evidential
Matter")
1. The third standard of field work is:
Sufficient competent evidential matter is to be obtained through
inspection, observation, inquiries, and confirmations to afford a rea­sonable
basis for an opinion regarding the financial statements under
examination.
2. Most of the independent auditor's work in forming his opinion
on financial statements consists of obtaining and evaluating eviden­tial
matter concerning the assertions in such financial statements. The
measure of the validity of such evidence for audit purposes lies in the
judgment of the auditor; in this respect audit evidence differs from
legal evidence, which is circumscribed by rigid rules. Evidential
matter varies substantially in its influence on the auditor as he de­velops
his opinion with respect to financial statements under exam­ination.
The pertinence of the evidence, its objectivity, its timeliness,
and the existence of other evidential matter corroborating the con­clusions
to which it leads all bear on its competence.
Nature of Assertions
3. Assertions are representations by management that are em­bodied
in financial statement components. They can be either explicit
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