Mod 1 Wrong Answers

Question 0

2 possible circumstances justifying departure from GASB statement standards are…

Answer 0

1 new legislation

2 new form of business transaction

Question 1

CPAs are only allowed to depart from a GASB statement only when results of the standard would be…

Answer 1

Misleading

Question 2

When a supervisor departs from GAAP, the CPA under there supervision can…

Answer 2

Determine whether there are responsibilities to communicate matter
To third party

Question 3

Discreditable acts framework…

Answer 3

Does not exist in the CPA profession

Question 4

Accounting and consulting services do not normally impair independence because…

Answer 4

The member’s role is advisory in nature

Question 5

When a CPA contracts with a client to supervise the client’s office personnel, they are…

Answer 5

Performing a management function which impairs independence

Question 6

Due care does not require…

Answer 6

Obtaining specialty accreditation

Question 7

Due care requires a member to discharge…

Answer 7

Professional responsibilities with competence and due diligence

Question 8

Competence represents the…

Answer 8

Attainment and maintenance of level of understanding and
Knowledge that enables member to render services with facility
And acument

Question 9

Due care establishes limitations of a member’s capabilities by…

Answer 9

Dictating that consultation or referral may be required when
Professional engagement exceeds personal competence of member

Question 10

A member in public practice shall not…

Answer 10

For a commission recommend or refer to a client a product or

Service

Question 11

A CPA can’t recommend for a commission refer any…

Answer 11

Product or service supplied by a client

Question 12

A CPA can’t receive a commission when Member or member’s firm perform for that client…3

Answer 12

1 audit of financial statements
2 Compilation of financial statement when member expects
Third party to use financial statement/report doesn’t disclose
Lack of independence
3 examination of prospective financial info

Question 13

A CPA may purchase a product and…

2) any profit on sale would not…

Answer 13

Resell it to a client

2) constitute a commission

Question 14

A fully secured loan that a CPA takes from a compilation client, is considered what when they are asked to audit the client a year later?

Answer 14

Grandfathered (independence was not required)

Question 15

If independence was not required at the time the loan was obtained from the client and the CPA is asked to perform an audit, the CPA is considered…

Answer 15

Independent

Question 16

Of the five member board of the PCAOB…

Answer 16

No more than 2 members may be CPAs

Question 17

The portion of the report issued on a CPA firm’s quality control is…

Answer 17

Not ordinarily made publicly available

Question 18

Most of the PCAOB report, other than the portion on quality control is…

Answer 18

Made available to the public

Question 19

Audit reports based on international auditing standards must include…

Answer 19

Location where auditor practices (city, country)

Question 20

Whether accounts receivable are confirmed is based on…2

Answer 20

1 auditor’s assessed risk of material misstatement and

2 how audit evidence, from other planned audit procedures,
Reduce that risk

Question 21

Identify the body that enforces the audit requirements of ERISA

Answer 21

Department of Labor

Question 22

When compiling financial statements for a non public company for the past year and issuing a publicly available report, the CPA’s…

Answer 22

Independence is not required

Question 23

For performance of a review of a Nonpublic company’s annual financial statements.

What standards provide guidance?

Answer 23

Statements on Standards for Accounting and Review Services

SSARS

Question 24

For examination of a client’s financial forecast.

What standards provide guidance?

Answer 24

State,nets on Standards for Attestation Engagements (SSAE)