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Chapter 1

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An Introduction to Auditing
Lauren Alsobrook
Quiz by Lauren Alsobrook, updated more than 1 year ago
Lauren Alsobrook
Created by Lauren Alsobrook about 8 years ago
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Resource summary

Question 1

Question
An integrated audit is
Answer
  • required for all companies
  • required by the IAASB
  • Composed of financial statement audit and an audit of internal control over financial reporting
  • conducted according to audit standards of AICPA

Question 2

Question
Evidence
Answer
  • is composed of various items including underlying records of accounts and docs
  • must be in written form
  • includes records created by the auditor to document audit activities
  • includes only corroborating info obtained from outside the client

Question 3

Question
The PCAOB
Answer
  • is a not for profit entity
  • shares responsibility for standard setting with AICPA
  • creates audit standards that CPA firms must use in all audits
  • is independent of SEC oversight

Question 4

Question
The “highest” level of a CPA firm hierarchy is:
Answer
  • The shareholders.
  • The partners
  • The managers
  • Both a and b

Question 5

Question
Which of the following is NOT a “Big Four” firm?
Answer
  • PWC
  • Grant Thornton
  • Deloitte
  • EY

Question 6

Question
Which body regulates the audits of nonpublic companies in the United States?
Answer
  • PCAOB
  • AICPA
  • IFRS
  • SEC

Question 7

Question
The Securities and Exchange Commission:
Answer
  • is a govt. entity
  • authorizes all PCAOB standards before they become effective
  • Can reject company filings or suspend trading of company stocks
  • All of the above

Question 8

Question
The GASB:
Answer
  • Sets audit standards for auditors engaged in auditing not-for-profit entities.
  • Regulates state and local governments.
  • Set reporting standards for state and local government entities
  • All of the above

Question 9

Question
Financial statements must be prepared:
Answer
  • in accordance with GAAP
  • in accordance with IFRS.
  • in accordance with OCBOA
  • Any of the above, depending on which set of standards the circumstances dictate as applicable.

Question 10

Question
The audit engagement team consists of:
Answer
  • more than one partner.
  • associates and seniors.
  • Managers
  • All of the above

Question 11

Question
Which of the following organizations is considered to be a public company?
Answer
  • A firm whose privately held stock is owned exclusively by an individual.
  • A partnership of doctors.
  • A privately-held firm controlled by three family members
  • A firm whose stock is registered with the SEC

Question 12

Question
The auditor
Answer
  • prepares the financial statements after the client agrees to all adjustments.
  • writes the footnotes to the financial statements to ensure their accuracy.
  • performs work to reach an opinion on the ICFR and financial statements.
  • None of the above

Question 13

Question
To which of the following would AICPA attest standards not apply?
Answer
  • Standard for Accounting and Review Services (SSARS)
  • Elder Care
  • Loans under TALF
  • Internal Control for nonpublic company
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