When formulating a definition of professional skepticism, the auditor must follow paragraphs 7-9 of the Audit Standard AS 1015.
Paragraph 7 states that “professional skepticism is an attitude that includes a questioning mind and a critical assessment of audit evidence”. It implies that there are many variables in auditing, which requires skill and knowledge to comprehend appropriately.
Paragraph 8 states that the auditor should “consider the competency and sufficiency of the evidence”. As the auditor is the person responsible for evaluation, they have to ensure that there is enough evidence to make an evaluation.
Paragraph 9 states that “the auditor should not be satisfied with less than persuasive evidence”. It means that the auditor’s judgment should not be clouded with assumptions regarding management’s honesty.