ACCA Advanced Audit and Assurance (AAA) Practice Exam

What is the fundamental aspect of "professional scepticism"?

1. A belief in the client's honesty at all times

2. An acceptance of all client assertions without question

3. A questioning mindset that critically assesses audit evidence

4. Blind trust in established auditing procedures

The correct answer is: A questioning mindset that critically assesses audit evidence

The concept of professional scepticism is crucial in the audit process as it involves maintaining a questioning mindset. This critical approach ensures that auditors do not simply accept client assertions at face value but instead actively evaluate the evidence presented to them. Professional scepticism encourages auditors to probe deeper, to seek corroboration for information, and to consider the possibility of misstatements, whether due to error or fraud. This mindset is essential for enhancing the quality of the audit, as it prompts auditors to challenge assumptions and to remain alert to indicators that may suggest issues requiring further investigation. While the other choices depict attitudes that undermine the effectiveness of an auditor, such as presuming a client's honesty without scrutiny or showing blind trust in established procedures, they fail to reflect the necessary diligence and critical thinking that define professional scepticism. It is this focused, questioning approach that ultimately allows for more reliable audit conclusions and a greater assurance that the financial statements are free from material misstatement.