Chapter 1 - The Auditing Profession & Chapter 2 - The CPA Profession

Question 1

GAO

Answer 1

Government Accountability Office Auditor

Question 2

IRA

Answer 2

Internal Revenue Agents

Question 3

Internal Auditors

Answer 3

Employed by all types of organizations to audit for management.

Question 4

CPA

Answer 4

Certified Public Accountant

Question 5

Auditing Services

Answer 5

Accumulation and evaluation of evidence about information to determine and report on the degree of correspondence between the information and established criteria.

Question 6

Attestation Services

Answer 6

A type of Assurance Service in which Audits and Reviews happen.

Question 7

Assurance Services

Answer 7

Independent professional service that improves the quality of information for decision makers. (Consumer Reports, BBB, etc.)

Question 8

GAAS

Answer 8

Generally Accepted Auditing Standards.

Issued by ASB

Question 9

GAAS - General Standards

Answer 9

(1) Audit to be performed by a person with adequate training as an auditor.
(2) Independence.
(3) Due professional care is to be exercised.

Question 10

GAAS - Standards of Field Work

Answer 10

(1) Audit is to be adequately planned and assistants are to be properly supervised.
(2) Sufficient understanding of Internal Controls
(3) Sufficient appropriate evidential matter is to be obtained to afford a reasonable opinion.

Question 11

PCAOB

Answer 11

Public Company Accounting Oversight Board.
Overseen by the SEC.
Conducts inspections of registered accounting firms.

Question 12

SEC

Answer 12

Securities and Exchange Commission.

Question 13

Securities Act of 1933

Answer 13

Requires new publicly traded companies to file a Form S-1

Question 14

Securities Act of 1934

Answer 14

Requires publicly traded companies to file a Form 10-K

Question 15

Form S-1

Answer 15

New company

Question 16

Form 8-K

Answer 16

Significant events that are of interest to public investors.

Question 17

Form 10-Q

Answer 17

Quarterly report

Question 18

Form 10-K

Answer 18

Annual report

Question 19

AICPA

Answer 19

American Institute of Certified Public Accountants. Restricted to CPAs, but not all members are practicing as independent auditors.
Sets up ASB.

Question 20

SAS

Answer 20

Statements on Auditing Standards.

Question 21

ASB

Answer 21

Auditing Standards Board. Issue Pronouncements on auditing matters in the U.S. for all entities other than publicly traded companies. Pronouncements are called SASs.

Question 22

GAAS - Standards of Reporting

Answer 22

(1) The report shall state whether the financial statements are presented in accordance with GAAP.
(2) The report shall identify those circumstances in which such principles have not been consistently observed in the current period in relation to the preceding period.
(3) Informative disclosures in the FINS are to be regarded as reasonably adequate unless otherwise stated in the report.
(4) The report shall contain either and opinion or an assertion to the effect that an opinion cannot be expressed.

Question 23

Peer Review

Answer 23

Practice-monitoring, is the review of CPAs, of other CPA firm’s compliance with its quality control system.

Question 24

CPA Services

Answer 24

(1) Auditing
(2) Accounting & Bookkeeping
(3) Tax
(4) Management Consulting