MCQ AUD 2.6

Question 1

An engagement which enables CPA to determine whether clients business meet defined criteria for standard business practices and controls

Answer 1

Statements on standards for attestation engagements

Question 2

An examination of financial forecast is a professional service that involves

Answer 2

Evaluating the preparation of the prospective financial statements
Evaluating the support underlying the assumptions
evaluating the presentation of prospective financial statements in conformity with AICPA guidelines
Issuing an examination report

Question 3

The independence standards

Answer 3

is almost the same for audit and attestation standards

Question 4

Financial projection

Answer 4

are restricted use reports

Question 5

The report on a compilation

Answer 5

should include a separate paragraph that describe the limitations on the presentation usefulness

Question 6

When reporting on an audit of historical financial statements

Answer 6

Negative assurance is not an appropriate reporting option. The auditor must either express an opinion or disclaim an opinion

Question 7

subject to

Answer 7

is not an acceptable wording for an accountant report

Question 8

partial presentations

Answer 8

are presentation of prospective financial information which omit one of these elements 
Sales or gross revenue
Gross profit or cost of sales
unusual or infrequently occurring items
provision for income taxes
Discontinued operations
extraordinary items
income from continuing operations
net income
significant changes in financial position

Question 9

attestation engagments

Answer 9

specifically exclude consulting services advocacy services return preparation

Question 10

Whenever the accountant reports on prospective financial statements

Answer 10

the report should include a caveat that prospective results may not be achieved