Which statement is not true regarding the competence of audit evidence?

Which statement is not true regarding the competence of audit evidence?

• A. Relevance is enhanced by an effective information system
• B. To be competent, evidence must be both valid and relevant
• C. Validity is related to the quality of the client's information system
• D. Relevance must always relate to audit objectives

Answer: (A)

The main idea here is that audit evidence must be both relevant and reliable (valid) to be competent. Relevance means the evidence actually helps address the specific audit objectives and assertions being tested. Reliability and validity come from the data’s accuracy, completeness, and the integrity of its source. The statement that relevance is enhanced by an effective information system isn’t necessarily true. An information system being well designed and controlled can improve the quality and reliability of data, but relevance is about the connection to the audit objectives. Data from even a highly effective system may be irrelevant if it does not bear on the particular assertions under examination. That’s why the other points fit: to be competent, evidence must be both valid and relevant; validity is tied to the quality of the client’s information system (better systems can produce more accurate data); and relevance must always relate to the audit objectives.

The main idea here is that audit evidence must be both relevant and reliable (valid) to be competent. Relevance means the evidence actually helps address the specific audit objectives and assertions being tested. Reliability and validity come from the data’s accuracy, completeness, and the integrity of its source.

The statement that relevance is enhanced by an effective information system isn’t necessarily true. An information system being well designed and controlled can improve the quality and reliability of data, but relevance is about the connection to the audit objectives. Data from even a highly effective system may be irrelevant if it does not bear on the particular assertions under examination.

That’s why the other points fit: to be competent, evidence must be both valid and relevant; validity is tied to the quality of the client’s information system (better systems can produce more accurate data); and relevance must always relate to the audit objectives.