Auditing Accounting Estimates (2)

Question 1

When do management often make these estimates?

Answer 1

In conditions of uncertainty over outcomes and with use of judgement

Question 2

What if risk of misstatement is increased?

Answer 2

Evidence available to detect a material misstatement is more difficult to obtain and less persuasive than relating to other items in FS

Question 3

What is auditor required to do?

Answer 3

Obtain sufficient appropriate evidence about whether accounting estimates and related disclosures are reasonable