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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 Copyright © by the American Institute of Certified Public Accountants, Inc. 1211 Avenue of the Americas, New York, N. Y. 10036 1234567890 AudS 89876543210