Chapter 5 Audit Quiz

[blank_start]Existence[blank_end] is the assertion that assets, liabilities, and equity actually exist.

[blank_start]Rights/obligations[blank_end] is the assertion that a company has the right to collect or the obligation to pay something

[blank_start]Completeness[blank_end] is the assertion that all transactions have been recorded

[blank_start]Valuation and allocation[blank_end] is the assertion that assets, liabilities, and equity are valued correctly.

[blank_start]Accuracy[blank_end] is the assertion that assets, liabilities, and equity accounts are mathematically correct. It refers only to math, transposition, or amount-related errors.

[blank_start]Occurrence[blank_end] refers to whether or not a transaction occured

[blank_start]Completeness[blank_end] refers to all transactions being recorded

[blank_start]Authorization[blank_end] refers to all transactions being authorized

[blank_start]Accuracy[blank_end] refers to transactions being properly recorded

[blank_start]Cutoff[blank_end] refers to transaction being recorded in the proper period

Sufficiency is the measure of the [blank_start]quantity[blank_end] of audit evidence.

A greater risk of misstatement requires a lower quantity of audit evidence, whereas a higher quality audit evidence results in a higher quantity of audit evidence

Appropriateness is a measure of the [blank_start]quality[blank_end] of audit evidence.

Which of the following will increase the reliability of audit evidence?

The three types of audit confirmations are positive: blank, positive: amount included, and negative.

To fill the assurance bucket, start with [blank_start]risk[blank_end] assessment procedures, then perform tests of controls, perform substantive analytical procedures, and acquire the remaining assurance needed from tests of details.

Analytical procedure have to do with non-financial data only.

Which of the following is used to obtain evidential matter about particular assertions related to account balances or classes of transactions.

Which of the following is NOT an example of an analytical procedure?

PCAOB auditing standard no. 3 governs documentation for public companies. It says that documentation must be maintained for [blank_start]7[blank_end] years from the date of the audit.

For which of the following do managers need to insure information flows in a way that will confirm existence?