Random

Question 1

Generalized audit software package

Answer 1

Select items meeting certain criteria

Question 2

Embedded audit module

Answer 2

Section of program code that can be used to collect specific transaction data

Question 3

What type of assurance do you give in a compliance audit

Answer 3

Negative assurance (in connection with financial statement audit)

Question 4

Government audits do not form an opinion on what

Answer 4

Internal control - but they do report on it

Question 5

The accountant may compile financial statements that omit substantially all disclosures provided that

Answer 5

The report clearly indicates the omission and statement that the omission is not meant to mislead

Question 6

In establishing existence of long term investments

Answer 6

Auditor can inspect securities or confirm shares with an independent custodian

Question 7

In designing an audit plan the auditor should establish objectives around

Answer 7

Financial statement assertions

Question 8

Confirmation of receivables provides evidence regarding what

Answer 8

Existence

Question 9

Due professional care requires what

Answer 9

A CPA to critically review the work done by others

Question 10

A practitioners report on agreed upon procedures should contain

Answer 10

A description of procedures performed & related findings

Question 11

Which is more reliable a bank statement or bank confirmation

Answer 11

Bank confirmation- less likely to be altered due to direct correspondence with auditor and 3rd party

Question 12

What is independence rule for litigation

Answer 12

Independence is not impaired by litigation with an audit client of the dollar amount is immaterial and unrelated to audit work

Question 13

What would an auditor likely do regarding valuation of trading securities

Answer 13

Verify from third party market prices like NASDAQ

Question 14

What control reduces errors in billing

Answer 14

Compare totals for shipping documents with corresponding total for sales invoices

Question 15

Is it acceptable to perform portions of a continuing audit at interim dates

Answer 15

Yes

Question 16

Which events justify a departure from GAAP

Answer 16

New legislation and a new form of business transaction

Question 17

When group auditor does NOT assume responsibility for component auditor what should they request from the component auditor

Answer 17

1- whether they complied with ethical requirements
2- identify financial information of the component
3- overall findings

Question 18

Does the auditor have to assess control risk before performing substantive tests

Answer 18

Yes

Question 19

Noncompliance should result in which opinion

Answer 19

Qualified or adverse

Question 20

Make sure you know that auditors OBSERVE the inventory count they don’t PERFORM inventory count

Answer 20

Know this

Question 21

Integrated test facility

Answer 21

Mixes test data with real data

Question 22

Procedure to perform in pro forma FS

Answer 22

Determine calculations are mathematically correct

Question 23

Confirmations prove what assertion

Answer 23

Existence

Question 24

What would help identify material accounting estimates

Answer 24

Reading board minutes

Question 25

Stratifying sampling decreases the effect of what

Answer 25

Variance

Question 26

Auditors on big cheats need to rotate and have a time-out Pernod how often

Answer 26

Every 5 years