a-3

Question 1

What is the primary objective of data security controls?

Answer 1

to ensure that storage media are only accessed, changed, or deleted after appropriate authorization. The objective is to protect information.

Question 2

As part of risk assessment procedures for an audit of a nonissuer, an auditor would most likely perform which of the following procedures concerning related party transactions?

Answer 2

Evaluate the entity’s procedures for identifying related party transactions.

Question 3

General IT Controls

Answer 3

Addresses the risks arising from the use of IT and an be categorized as:
Applications
Database
Operating system
Network

Question 4

Information Processing Controls

Answer 4

Controls over input, processing, and output include:
1. Controls over interfaces, integrations
2. Checking the mathematical accuracy
3. Automated edit checks of input data
4. Manual follow ups of exception reports

Question 5

Financial Statement Level Risks

Answer 5

Risks that relate pervasively to the financial statements as a whole and potentially impact many individual assertions.

Question 6

Assertion Level Risks

Answer 6

Risks of material misstatement that do not relate pervasively to the financial statement but rather relate to specific transactions, account balances, or disclosures.

Question 7

Nature

Answer 7

The nature of the audit procedures includes both its purpose (test of control vs. substantive procedure) and its type (inspection, observation, inquiry). The auditor varies the nature of audit procedures in order to achieve the desired level of reliability

Question 8

Extent

Answer 8

Refers to the quantity to be performed, such as the number of observations to be made or the sample size to be used. The higher assessed RMM the greater the extent

Question 9

Timing

Answer 9

Audit tests may be performed at an interim date or at period end. The higher RMM the closer to period end substantive procedures should be performed.

Question 10

Test of details

Answer 10

Applied to transaction classes, account balances and disclosures.

Question 11

Substantive analytical procedures

Answer 11

evaluations of financial information made by a study of plausible relationships among both financial and nonfinancial data

Question 12

Hierachy of audit evidence

Answer 12

1. Auditors direct personal knowledge
2. External evidence
3. Internal evidence
4. Oral evidence

Question 13

C the FIVE CARROT WARS

Answer 13

Procedures used in audits risk assessment procedures
Confirmation
Footing
Inquiry
Vouching
Examination/Inspection
Cutoff Review
Analytical Procedures
Reperformance
Reconciliation
Observation
Tracing
Walkthroughs
Auditing related accounts simultaneously
Representation letter
Subsequent Events review

Question 14

Procedures related to Completeness

Answer 14

Tracing, Analytical review, observation

Question 15

Procedures related to Cutoff

Answer 15

Cutoff procedures

Question 16

Procedures related to Valuation, allocation, and accuracy

Answer 16

Inspection, footing, independent recalc, reconciliation

Question 17

Procedures related to Existence and occurance

Answer 17

Confirmation, observation, inspection, examination, and vouching

Question 18

Procedures related to Rights and obligations

Answer 18

Inspection

Question 19

Procedures related to

Question 20

Procedures related to Understandability of Presentation and classification

Answer 20

Inspection, review, inquiry

Question 21

Advantages of statistical sampling

Answer 21

Measure the sufficiency of the audit evidence obtained, provide an objective basis for quantitatively evaluating sample results, design an efficient sample.
Quantify sampling risk

Question 22

Attribute sampling

Answer 22

Primarily used for testing controls

Question 23

Variables sampling and PPS

Answer 23

used in substantive testing of account balances

Question 24

Procedures related to