[Anonymous]

I’m on the AICPA website trying to get some fluidity with search the professional literature for Audit. So I go over to Wiley and pick a research SIM to practice on. Seems straightforward enough:

“Identify the section of professional standards that describes the circumstances in which an auditor may decide to use negative confirmation requests as the only substantive audit procedure to address an assessed risk of material misstatement at the assertion level.”

So I go to the AICPA site and there it is clear as day in AUC 505:

15 Negative confirmations provide less persuasive audit evidence than positive confirmations. Accordingly, the auditor should not use negative confirmation requests as the sole substantive audit procedure to address an assessed risk of material misstatement at the assertion level, unless all of the following are present:

a. The auditor has assessed the risk of material misstatement as low and has obtained sufficient appropriate audit evidence regarding the operating effectiveness of controls relevant to the assertion.

b. The population of items subject to negative confirmation procedures comprises a large number of small, homogeneous account balances, transactions, or conditions.

c. A very low exception rate is expected.

d. The auditor is not aware of circumstances or conditions that would cause recipients of negative confirmation requests to disregard such requests. (Ref: par. .A32)

So then I look in Wiley and I see this Under AUC-505

.15 In such circumstances, rather than inspecting and obtaining documentary evidence of the entity’s tax liability contingency analysis and making inquiries of the entity, may the auditor consider the counsel as a management’s specialist within the meaning of section 500 and rely solely on counsel’s opinion as an appropriate procedure for obtaining audit evidence to support his or her opinion on the financial statements?

Huh?