AUD, Auditing and Attestation
Sources for Professional Skepticism and Professional Judgment
Last reviewed
The standards and authorities behind PocketCPA's AUD lessons on Professional Skepticism and Professional Judgment. The topic rests on AU-C 200.
About this topic
Management knows the entity better than the auditor ever will, and management has an interest in how the numbers come out. Professional skepticism and professional judgment are the profession's answer to that one pairing.
The question this Topic answers. What attitude does the auditor bring to evidence the audited entity itself supplied, and what may that attitude be traded away for?
Key points
- Professional skepticism is a questioning mind and critical assessment of evidence, neither assuming dishonesty nor unquestioning trust.
- Professional judgment is the application of training, knowledge, and experience to make informed decisions in the engagement context.
- Skepticism failures include both insufficient skepticism (accepting without challenge) and excessive suspicion (audit paralysis).
- Documentation must demonstrate how professional skepticism was applied, not just state that it was.
What the lessons cover
- Professional skepticism
- Professional judgment
- Applying both well
- Reasonable assurance and the inherent limitations of an audit
- Skepticism inside a specific standard
- AU-C 200 and PCAOB AS 1000 drawn apart
- Documenting a judgment, including the evidence against it
Authoritative references
Where these requirements sit in the literature.
AU-C 200, Overall Objectives of the Independent Auditor, the nonissuer standard carrying both requirements:
- What the section holds. Both requirements, plus reasonable assurance, the audit risk model, materiality, and the inherent limitations of an audit.
- The two paragraph numbers. AU-C 200.17 carries professional skepticism and AU-C 200.18 carries professional judgment, settled 2026-08-14 against the AICPA's free compilation of currently effective AU-C sections.
- They were corrected against the AICPA compilation, which puts the skepticism requirement at .17 and the judgment requirement at .18.
PCAOB AS 1000, General Responsibilities of the Auditor in Conducting an Audit, the issuer counterpart:
- Due professional care. .09, of which skepticism is a component.
- Engagement partner responsibilities. .10, including that judgments be supported by sufficient appropriate evidence.
- Skepticism and judgment. .11 says what skepticism involves; .12 carries professional judgment.
- Reasonable assurance. .13 requires evidence sufficient for it; .14 fixes it as high, not absolute.
- Documentation. .16.
- What it replaced. It replaced the interim general-responsibility standards, so AS 1015 is no longer the cite. AS 2301 footnote 4 and AS 2401.13 both direct the reader to AS 1000.09 and .11.
PCAOB AS 2401, which carries fraud risk and the bias that goes with it:
- Skepticism regardless of history. AS 2401.13 covers past experience, and the auditor's belief about management's honesty.
- Bias in estimates. AS 2401.63 through .65 carry the bias, the retrospective review, and the earnings-target illustration.
- Significant unusual transactions. AS 2401.66 and .66A carry the procedures on business purpose.
PCAOB AS 2301, which is where skepticism meets fieldwork:
- Bias in principles. Paragraph .05 asks whether the application of accounting principles indicates bias.
- Skepticism in the field. Paragraph .07 covers gathering and evaluating evidence.
- Contradicting evidence. Paragraph .46 forces risk assessments to be revised.
PCAOB AS 1105 and AS 2310, the mechanics of resolving a doubt about reliability:
- Inconsistent evidence. AS 1105.29 says what the auditor does with it.
- A confirmation that may have been intercepted. AS 2310.18 names the three indicators, and AS 2310.19 requires alternative procedures where reliability cannot be established.
PCAOB AS 1215, the documentation standard:
- The experienced-auditor test. AS 1215.06A extends it to who did the work, who reviewed it, and when.
- How much is enough. AS 1215.07 makes the extent of judgment an explicit factor.
- What must be kept. AS 1215.08 carries the duty to retain contradicting information and the records resolving differences in professional judgment.
PCAOB AS 2810, AS 2105, AS 2415 and AS 2805, four standards a skepticism question reaches through:
- Management bias. AS 2810 catalogs it at .24 through .27, and requires reassessing fraud risks when bias is found.
- Materiality. AS 2105.11 and .12 require reevaluating materiality and tolerable misstatement.
- Going concern. AS 2415.07 through .09 require assessing whether management's plans can be effectively implemented.
- Representations. AS 2805.02 states that representations are not a substitute for the procedures needed to support an opinion.
AICPA analogues, as cited by this group's items:
- Revising materiality. AU-C 320 carries it.
- Feasibility of management's plans. AU-C 570 carries it.
- Necessary but not sufficient. AU-C 580 carries the written representation.
- Related-party transactions. AU-C 550 reaches those outside the normal course of business.
- Persuasiveness of evidence. AU-C 500 carries it.
- Fraud conditions. AU-C 240 covers altered documents and estimate bias.
- Documentation of significant judgments. AU-C 230 carries it.
- The review comparison. AR-C 90 supplies it.
How PocketCPA uses these sources
Every lesson is written in original words and cites the paragraph each rule comes from. No standard's text is reproduced. How lessons and questions are written and checked is set out in our methodology.