SSARS

Question 1

Which is NOT TRUE about review report of interim Fin info for public company

Answer 1

It’s similar to audit report in that both provide opinion whether FS are in conformity with GAAP

Question 2

Personal financial plan containing Personal unaudited statement NOT required to follow SSARS

Answer 2

Also SSARS don't apply to 
Personal FS for pension
To submit for taxing
Litigation services involve potential legal or reg procedures
Valuation services

Question 3

SSARS

Answer 3

No Accountant letterhead required

No MANUAL SIGNATURE required

Question 4

Under SEC rules

Lead and concurring partner must rotate every 5 years
Other partners 2 yesrs
Other audit team rotate every 7 years

Answer 4

Small firms with less than 5 people are exempt

Question 5

Review and compilation engagements not require to perfect procedures to detect

Answer 5

MM due to fraud or non-compliance

Question 6

Review of interim FS of Public company (PSAOB) and review of a nonissuer FS (SSARS)

Answer 6

Evaluation of Internal control - required for issuer only

Communication with predecessor auditor-required for issuer only

Both doesn’t require external inquires from attorney

Question 7

Review of interim financial info presented in registration statement. Prospectus should include statement

Answer 7

Accountant’s review report is not a part of registration statement 1933

PCAOB standards approved by Sec

Question 8

Standard compilation report impiles

Answer 8

All disclosures required by GAAP are included in the report

Question 9

Report prepared in accordance with Section 404 of Sarbanes Oxley Act of 2002

Answer 9

Attest and report on the internal Control assessment made by the management of the issuer

Question 10

Accountant make implicitly representation when issuing compilation report

Answer 10

Accountant independent with respect to theventity

Question 11

All the disclosures required by GAAP can be omitted in

Answer 11

Çompilation

Question 12

Sarbanes Oxley Act of 2002 requires communication when auditor providing tax services to issuer

Answer 12

• Communicate in writing the proposed tax services and related fees
• Auditor must discuss with committee potential effect of proposed tax services on firms independents

CONTINGENT FEE FORBIDDEN

Question 13

3 situations auditor can provide issuer non audit service without impairing independence and obtaining pre-approval of audit committee. Regulation S-X

Answer 13

Services approved by committee PRIOR to completion of the audit

LESS that 5 % revenue

Services not recognized as non audit services at the time of engagement

Providing factual accounts in testimony explaining position taking during performance

Question 14

Non audit service which impaires independence

Answer 14

Perform financial info systems design and implementation

Question 15

Independence is not impaired if

Answer 15

CFO was employed by accounting firm greater than one year before the audit

Question 16

Letters of underwriter give negative assurance on

Answer 16

A audited interim financial statements

Question 17

Typical comfort letter covers

Answer 17

An opinion as whether auditor FS comply in form with Accounting requirements by SEC

Negative assurance unaudited condensed fin info compiles in form with requirements of SEC

Typically give negative assurance on unaudited interim financial information

Review of interim financial info is required before a comfort letter may be used

Question 18

Accountant is unable to indicate on each page “No assurance is provided”, then the auditor should:

Answer 18

Issue a disclaimer OR

Perform a compilation report

Question 18

Accountant is unable to indicate on each page “No assurance is provided”, then the auditor should:

Answer 18

Issue a disclaimer OR

Perform a compilation report

Question 19

Review of interim FS. Auditor becomes aware of significant changes in Conte activities at one Branch location. Which can auditor perform in response to this situation

Answer 19

Making additional inquiry

Question 20

Drafting FS notes for the client

Answer 20

Is not a part of compilation

Question 21

Not a compilation

Answer 21

Reproducing client prepared FS without modification

Prepare standard monthly JE (bookkeeping service)

Question 22

An accountant compiles unaudited FS that are not expected to be used by 3 Rd party. Accountant may decline to issue a compilation report provided

Answer 22

• Each page restrict use NO
• Writtren engagement letter is used to document understanding with client NO
• Writtren rep letter is obtained from client’s management NO

Question 23

Controller of small utility company has interviewed audit firm proposing to perform annual audit of employee benefits plan. According to DOL auditor must be

Answer 23

Independent for purpose of examinig FS required to be filed annually with DOL

Question 24

Safeguards to threats to independence identified by Generally Accepted Government Auditing Standards are generally not effective to mitigate

Answer 24

Management partisipaltion threat

Question 25

Which is true about AICPA code of prof condact

Answer 25

It applies to compilation and reviews

Question 26

Which is true regarding an accountant consideration of fraud with laws and regulations in compilation and review engagements

Answer 26

Accountant is NOT required to perform procedures designed to detect MM due to fraud

Question 27

Which is correct conserning çompilation of specific alements, accounts, items of financial statement?

Answer 27

Compilation can not be relied upon to disclose errors, grad illigal acts

Question 28

An accountants çompilation report should

Answer 28

The report should state that the accountant does not express an opinion on the financial statements.