Auditing - Bank Confirmations

Bank confirmations are essential in audits to verify account and loan balances, ensuring the existence and completeness assertions. Auditors require direct responses from banks to prevent client interference. While traditional methods involved letters, modern practices use automated systems and third-party services like confirmation.com, especially for large clients.

What is the primary purpose of bank confirmations in an audit?

Why is it important for the bank to send a response directly to the auditor?

In what situations might an auditor still write a letter to a client's bank?

How has the process of obtaining bank confirmations changed over time?

What role do third-party service providers play in the bank confirmation process?