26424745
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Quiz von Kayla Harbaugh, aktualisiert more than 1 year ago
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Erstellt von Kayla Harbaugh
vor etwa 4 Jahre
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Frage 1
Frage
Which of the following auditor concerns most likely would be so serious that the auditor would conclude that a financial statement audit cannot be performed?
Antworten
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There is substantial risk of management intentionally manipulating accounting records.
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A portion of supporting evidence stored at an offsite storage facility was destroyed by a hurricane.
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The CPA lacks experience in the client's operations and industry.
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Management has imposed a restriction that the auditor believes will result in a qualified opinion.
Frage 2
Frage
What is the primary objective of obtaining an understanding of the company's objectives, strategies, and related business risks in a financial statement audit?
Antworten
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Determine whether sufficient objectives have been created.
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Identify suggestions for addressing the risks.
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Identify risks that may result in material misstatement of financial statements.
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Provide a basis for issuing an opinion the financial statements.
Frage 3
Frage
The auditor's responsibility regarding material misstatements caused by fraud is:
Antworten
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The same as the auditor's responsibility regarding material misstatements caused by error.
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Either less than or greater than the auditor's responsibility regarding material misstatements caused by error, depending on the specific circumstances.
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Less than the auditor's responsibility regarding material misstatements caused by error.
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Greater than the auditor's responsibility regarding material misstatements caused by error.
Frage 4
Frage
Which of the following is not true regarding fraud risk factors?
Antworten
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They include incentives/pressures, opportunity, and rationalization.
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Lack of observation of the three fraud risk factors implies that there is no fraud risk.
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The existence of all three fraud risk factors is not an absolute indication that fraud has occurred.
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Fraud risk factors are often present in circumstances where fraud has occurred.
Frage 5
Frage
Which one of the following is a true statement about the required risk assessment discussion?
Antworten
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The discussion should involve all members who participate on the audit team, including the engagement partner.
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The risk assessment discussion should occur during the overall review stage of the audit.
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The discussion should include consideration of the risk of management override of controls.
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The discussion about the susceptibility of the entity's financial statements to material misstatement must be held separately from the discussion about the susceptibility of the entity's financial statements to fraud.
Frage 6
Frage
A successor auditor's inquiries of the predecessor auditor should include questions regarding:
Antworten
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a. The assessment of the objectivity of the client's internal audit function.
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b. The number of engagement personnel the predecessor assigned to the engagement.
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c. The response rate for confirmations of accounts receivable.
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d. Communications to management and those charged with governance regarding significant deficiencies in internal control.
Frage 7
Frage
Which of the following is true regarding performance of the following audit tasks while obtaining an understanding of internal control?
Audit Tasks:
I. Obtain an understanding of the design of controls.
II. Determine whether internal controls have been implemented.
III. Evaluate the operating effectiveness of controls.
Antworten
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a. The auditor must perform I, II, and III.
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b. The auditor must perform I and II, and is allowed, but not required, to perform III.
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c. The auditor must perform I and II, but may not perform III.
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d. The auditor may, but is not required to, perform I, II, and III.
Frage 8
Frage
Jefferson, CPA, has identified five significant deficiencies in internal control during the audit of Portico Industries, a nonissuer. Two of these conditions are considered to be material weaknesses. Which best describes Jefferson's communication requirements?
Antworten
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a. Communicate the two material weaknesses to Portico's management and those charged with governance, but not the three significant deficiencies that are not material weaknesses.
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b. Communicate all five significant deficiencies to Portico's management and those charged with governance, but only require a management response with respect to the two material weaknesses.
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c. Communicate all five significant deficiencies to Portico's management and those charged with governance, without distinction among the deficiencies.
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d. Communicate all five significant deficiencies to Portico's management and those charged with governance, distinguishing between significant deficiencies and material weaknesses.
Frage 9
Frage
Which of the following factors are included in an entity's control environment?
Participation of Those Integrity and Organizational
Charged with Ethical Values Structure
Governance
________________________________________________________________________
a. Yes Yes No
b. Yes No Yes
c. No Yes Yes
d. Yes Yes Yes
Antworten
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a. c
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b. b
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c. d
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d. a
Frage 10
Frage
Which of the following is true regarding the audit process?
Antworten
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a. Evaluating management's representations (as included in the representation letter) is an important part of assessing control risk.
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b. The auditor must assess control risk before performing substantive tests.
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c. The auditor must perform some level of substantive tests before making a final assessment of control risk.
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d. Evaluating management's integrity is an important part of the planning process.
Frage 11
Frage
Which of the following statements is correct concerning corporations subject to the reporting requirements of the Securities Exchange Act of 1934?
Antworten
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a. The annual report (form 10-K) need not include audited financial statements.
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b. The quarterly report (form 10-Q) need only be filed with the SEC by those corporations that are also subject to registration requirements of the Securities Act of 1933.
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c. A current report (form 8-K) must be filed with the SEC within four days after a major change in the company.
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d. The annual report (form 10-K) must be filed with the SEC within 20 days of the end of the corporation's fiscal year.
Frage 12
Frage
Which of the following is not true about the relationship between quality control standards and professional standards such as GAAS?
Antworten
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a. The adoption of quality control standards increases the likelihood of compliance with professional standards on individual engagements.
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b. Quality control standards relate to the conduct of a firm's entire practice whereas professional standards such as GAAS relate to the conduct of an individual engagement.
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c. A firm's failure to establish or comply with an appropriate system of quality control implies that the firm has also failed to follow professional standards on individual engagements.
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d. A firm that has not adopted an appropriate system of quality control may still be in compliance with professional standards with respect to individual engagements.
Frage 13
Frage
Tracing shipping documents to sales invoices provides evidence that:
Antworten
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a. Shipments to customers were recorded as sales.
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b. Shipments to customers were properly invoiced.
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c. All goods ordered by customers were shipped.
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d. Sales billed to customers were actually shipped.
Frage 14
Frage
An auditor searching for unrecorded payables most likely would:
Antworten
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a. Compare subsequent bank statements with the accounts payable listing.
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b. Obtain a sample of vendor invoices and recalculate the invoice amount.
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c. Obtain the accounts payable listing and agree to subsequent cash payments.
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d. Compare cash disbursements made prior to year-end with vendor invoices.
Frage 15
Frage
An auditor wishes to test the completeness assertion for sales. Which of the following audit tests would most likely accomplish this objective?
Antworten
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a. Compare accounts receivable turnover (net credit sales / average gross receivables) in the current year to that achieved in the prior year.
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b. Use common size analysis to compare recorded sales to sales recorded by other companies in the same industry.
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c. Select a sample of shipments occurring during the year and trace each one to inclusion in the sales journal.
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d. Select large individual sales recorded during the year and review supporting documentation.
Frage 16
Frage
Which of the following documentation is not required for an audit in accordance with generally accepted auditing standards?
Antworten
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a. A written audit plan setting forth the procedures necessary to accomplish the audit objectives.
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b. The assessment of the risks of material misstatement at both the financial statement and relevant assertion levels.
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c. The basis for the auditor's decision to perform tests of controls concurrently with obtaining an understanding of internal control.
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d. The auditor's understanding of the entity's control activities that help ensure achievement of management's objectives.
Frage 17
Frage
In assessing control risk for purchases, an auditor vouches a sample of entries in the voucher register to the supporting documents. Which assertion would this test of controls most likely support?
Antworten
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a. Completeness.
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b. Rights and obligations.
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c. Allocation and valuation.
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d. Occurrence.
Frage 18
Frage
Which of the following statements is generally correct about audit evidence?
Antworten
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a. Appropriateness of audit evidence refers to the amount of corroborative evidence obtained.
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b. Information obtained indirectly from independent outside sources is more persuasive than the auditor's direct personal knowledge obtained through observation and inspection.
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c. Appropriateness of audit evidence refers to audit evidence obtained from outside the entity.
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d. The more effective the internal control structure, the more assurance it provides about the reliability of the accounting data and financial statements.
Frage 19
Frage
Which of the following types of audit evidence generally is the most reliable?
Antworten
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a. A bank statement.
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b. Analytical procedures.
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c. Inquiries made of the audit committee.
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d. A bank confirmation.
Frage 20
Frage
Which of the following procedures is the auditor least likely to perform when an auditor decides to use the work of an auditor's specialist as audit evidence?
Antworten
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a. Inquire of the entity and the auditor's specialist about any known interests that the entity has with the auditor's external specialist that may affect that specialist's objectivity.
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b. Refer to the auditor's specialist in the audit report to indicate a division of responsibility.
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c. Review the working papers of the auditor's specialist.
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d. Obtain knowledge of the specialist's qualifications.
Frage 21
Frage
Which of the following auditing procedures most likely would assist an auditor in identifying related party transactions?
Antworten
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a. Performing analytical procedures for indications of possible financial difficulties.
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b. Reviewing confirmations of loans receivable and payable for indications of guarantees.
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c. Inspecting correspondence with lawyers for evidence of unreported contingent liabilities.
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d. Vouching accounting records for recurring transactions recorded just after the balance sheet date.
Frage 22
Frage
A condition that may result in a higher risk of material misstatement is:
Antworten
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a. The existence of simple alliances and joint ventures.
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b. Application of new accounting pronouncements.
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c. High tenure of employees.
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d. Abundant availability of capital and credit.
Frage 23
Frage
During planning, the auditor learns that competitive bids are not obtained by the purchasing department. This knowledge may result in the auditor:
Antworten
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a. Increasing the assessment of control risk.
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b. Increasing the assessment of inherent risk.
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c. Decreasing the assessment of inherent risk.
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d. Decreasing the assessment of control risk.
Frage 24
Frage
As the acceptable level of detection risk increases, an auditor may:
Antworten
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a. Lower the assessed level of inherent risk.
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b. Increase the risk of material misstatement.
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c. Change the planned timing of substantive tests from year-end to interim.
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d. Eliminate the assessed level of control risk from consideration as a planning factor.
Frage 25
Frage
An auditor is likely using attribute sampling when he or she selects a sample of:
Antworten
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a. Cash receipts and traces them to the accounts receivable subsidiary ledger.
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b. Invoices to verify proper extensions and footings.
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c. Receivables and sends confirmations to client customers.
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d. Purchase orders and examines them for indication of proper approval.
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