F5

Question 1

Under the Sarbanes-Oxley Act of 2002

Answer 1

the chief executive officer is required to certify (or sign off) on all the other items, but is not required to certify the financial expertise of the audit committee.

Question 2

entity-level control

Answer 2

include controls related to the control environment, the risk assessment process, and the policies over risk management practices.

These affect the company as a whole not just a specific sector for example the controls on the completeness of deposited cash this would not be an entity control as it focuses on a singular account

Question 3

Material weakness

Answer 3

Is the only one that would lead to an adverse opinion

Question 4

disclaimer of opinion arises from

Answer 4

Restrictions on the scope of the engagement (Scope limitation)

Question 5

adverse opinion arises from

Answer 5

Identification of a material weakness

Question 6

Failure of management to provide a written representation letter acknowledging its responsibility for the effectiveness of internal control generally will result in

Answer 6

a disclaimer of opinion or withdrawal from the engagement.

Question 7

An engagement to report on whether a previously reported internal control weakness continues to exis

Answer 7

Is voluntary

does not have to comply with any professional standards for example PCAOB or GAAS

Requires a written report from the company management to the Auditors

Question 8

Scope

Answer 8

Uses the NET of things
Nature
Extent
Timing

Question 9

SSAE involves

Answer 9

Establiceghd by the AICPA and addresses information for Attestation services of

Agreed upon procedures
Financial forecast and projection
Pro forma FS
Compliance
Management’s discussion and analysis (MD&A)
Reporting on controls at a service organization

Question 10

The consistency assertion in an MD&A presentation addresses

Answer 10

whether nonfinancial data has been accurately derived from related records.

Question 11

The occurrence assertion in MD&A addresses whether

Answer 11

reported transactions or events have occurred during a given period.

Question 12

The presentation and disclosure assertion in MD&A addresses whether

Answer 12

information included in the MD&A presentation is properly classified, described, and disclosed.

Question 13

The completeness assertion in MD&A addresses whether

Answer 13

descriptions of transactions and events necessary to obtain an understanding of the entity’s financial condition are appropriately included in the MD&A presentation

Question 14

Financial forecast

Answer 14

Expected results

Question 15

Financial projection

Answer 15

Hypothetical assumption

Question 16

Prospective FS can be used by

Answer 16

You can pick between General Use or Limited Use

General Use (Financial Forecast)(Expected results) Implies that it will be used by parties not negotiating with the issuing company (For example sales pitch)

Limited Used FS (Financial projection)(Hypothetical assumption) will only be used by the issuing company and the people negotiating directly with them (for example a bank/lender) someone that is being negotiated with directly

Question 17

Adverse in porspective FS

Answer 17

No reasonable basis

Question 18

Disclaimer in prospective FS

Answer 18

Unable to preform reasonable procedures