What is required by auditors according to ASA 210?
A) Document their understanding of the engagement in working papers.
B) Communicate with the previous auditor.
C) Obtain knowledge of the business.
D) Use analytical procedures in the planning stage.

Question

Quizplus · Accepted Answer

According to ASA 210, the auditor is required to document their understanding of the engagement in working papers. This includes documenting the nature, timing, and extent of planned audit procedures as well as the results of the auditor's assessment of the risks of material misstatement.

Answer: C 
 ASA 210 also requires the auditor to obtain knowledge of the business and industry in which the entity operates. This includes understanding the entity's operations, the terms of its contracts, and the regulatory environment in which it operates.

Answer: D 
 While analytical procedures may be used in the planning stage of the audit, they are not specifically required by ASA 210.

Therefore, the best choices are A and C.

What Is Required by Auditors According to ASA 210