What is the key aspect of corroboration in analytical procedures?

The key aspect of corroboration in analytical procedures is the necessity to perform further work if necessary. This step is crucial in the audit process because analytical procedures involve evaluating financial information through analysis of plausible relationships among both financial and non-financial data.

When auditors identify unexpected variances or results during these procedures, it indicates that there may be a potential error or anomaly that requires additional investigation. This may involve gathering more evidence, conducting tests, or applying different audit techniques to validate findings. Corroboration helps auditors ensure that their conclusions are supported by sufficient, appropriate audit evidence, which is essential for ensuring the reliability and integrity of the financial statements.

Other options may not capture the essential nature of corroboration as effectively. For instance, relying solely on historical data without further evaluation would overlook any changes or developments in the business environment that could impact the current financial situation. Similarly, while reviewing ratios can confirm accuracy, simply doing so without additional context and corroborative evidence may not suffice. Using prior year results can provide insight, but it does not address the need to investigate discrepancies or anomalies identified in the current year’s analysis. Therefore, performing further work when needed is a critical aspect of establishing credible audit conclusions through analytical procedures.