Professional Responsibilities

Question 1

The Department of labor (DOL)requires

Answer 1

The auditor independent when auditing and providing an opinion on the financial info submitted annually to the DOL

Question 2

An CPA in PUBLIC practice must follow the following rules

1. integrity and objective rule
2. contingent fee rule
3. independent rule
4. form and organization and name rule

Answer 2

An CPA NOT in PUBLIC practice must follow the following rules

integrity and objective

Question 3

Section 404 of SOX 2012 requires each issuer’s annual report to contain an internal control report that

Answer 3

1. state the responsibility of management for establishing and maintaining an adequate internal control structure and procedures for financial reporting
2. contains an attest and assessment, as of the end of the most recent fiscal year of the issuer, of the effectiveness of the internal control structure and procedures of the issuer for financial reporting.

Question 4

Income statement accounts tend to be more predictable than balance sheet accounts

Answer 4

therefore interest expense would likely yield a higher level of evidence than the allowance for doubtful accounts, accounts receivable, or accounts payable

Question 5

Relationships involving income statement accounts tend to be more predictable than relationships involving only balance sheet accounts because income statement accounts represent transactions over a period of time, whereas balance sheet accounts represent amounts as of a point in time.

Answer 5

As a result, analytical procedures are more appropriate for operating expense accounts.