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There Are Six Factors That Affect the Reliability of Audit

question 81

Essay

There are six factors that affect the reliability of audit evidence.One factor is the independence of the provider (i.e. ,evidence obtained from a source outside the client company is more reliable than that obtained within).Identify and discuss the remaining five factors that affect the reliability of evidence.


Definitions:

Market Power

The ability of a firm or group of firms to manipulate the price or quantity of goods and services in the market, typically by restricting supply to influence prices to their advantage.

Industry

The organized economic activity related to the production, processing, and marketing of goods and services.

Interindustry Competition

Competition among firms that operate in different industries but compete for the same set of customers or inputs.

Oligopolistic Producers

Firms within a market structure where a small number of companies have the majority of market share and thus can significantly influence price and production levels.

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