If internal control is satisfactory, external evidence is more reliable than internal evidence.

The statement is generally true in the context of auditing. Here's why:

1. Internal control refers to the procedures and mechanisms implemented by a company to ensure the integrity of financial and accounting information, promote accountability and prevent fraud.

2. If a company's internal control is satisfactory, it means that the company has effective systems in place to ensure the accuracy and reliability of its internal data.

3. External evidence, on the other hand, refers to information that comes from independent sources outside the company. This could include bank statements, invoices from suppliers, or confirmations from customers.

4. In auditing, external evidence is generally considered more reliable than internal evidence. This is because external evidence is independently generated and less likely to be manipulated by the company.

5. However, if a company's internal control is strong, the reliability of internal evidence increases. This is because effective internal control reduces the risk of errors or fraud in the company's internal data.

6. Despite this, even with strong internal control, external evidence is still typically considered more reliable. This is due to the independent nature of external evidence.

7. Therefore, the statement is generally true: if internal control is satisfactory, external evidence is more reliable than internal evidence. However, it's important to note that auditors will usually consider a combination of both internal and external evidence when conducting an audit.