ACCA Audit and Assurance (F8) Practice Exam

Which factors affect the sufficiency of audit evidence?

1. Auditor's assessment of RoMM and the quality of audit evidence

2. Nature of the entity and the external environment

3. Size of the audit team and budget constraints

4. Standard auditing procedures used

The correct answer is: Auditor's assessment of RoMM and the quality of audit evidence

The sufficiency of audit evidence is primarily influenced by the auditor's assessment of the risks of material misstatement (RoMM) and the quality of the audit evidence collected. When auditors evaluate RoMM, they consider the inherent and control risks associated with the financial statements of the entity. A higher assessment of RoMM necessitates a greater quantity of convincing audit evidence to support the auditor's conclusion. Additionally, the quality of audit evidence—whether it's appropriate, relevant, and reliable—affects the sufficiency needed. High-quality evidence may reduce the amount of evidence required, while lower quality may require the auditor to gather more supportive documentation or corroborating evidence. The other options, while they may influence the audit process in various ways, do not directly address the core relationship between RoMM and the quality of audit evidence in determining its sufficiency. Factors like the nature of the entity, the external environment, team size, budget constraints, or standard auditing procedures play secondary roles in the overall evidence-gathering process rather than being direct determinants of sufficiency.