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Question 1

What is the purpose of an audit review of interim statements?

Answer 1

to provide the accountant with a basis for reporting whether material modification should be made for such info to conform to the applicable financial reporting framework.

Question 2

Positive assurance

Answer 2

whether audited FS comply as to form with SEC requirements

Question 3

Negative assurance

Answer 3

whether unaudited condensed or capsule interim info complies as to form with SEC requirements. And whether modifications are needed for the unaudited condensed consolidated FS. About any changes in amounts of capital stock, LT debt, or any decrease in other specified FS elements during a specified period since the last audit or review

Question 4

How is materiality calculated for Single Audits?

Answer 4

Determined separately for each major program

Question 5

SSARS

Answer 5

Statements on Standards for Accounting and Review Services

Question 6

Application and other explanatory material, identified by which words

Answer 6

May, might, could

Question 7

Presumptively mandatory requirement, identified by which words

Answer 7

should

Question 8

The SSARS are not applicable when:

Answer 8

Preparing a working TB.
Assisting in adjusting the books of an account.
consulting on accounting, tax, and similar matters.
Preparing tax returns.
Providing bookkeeping or data processing services.
Processing financial data for clients of other acct firms. preparing standard monthly JEs

Question 9

Unconditional requirements, word

Answer 9

Must

Question 10

What is an example of a preparation engagement?

Answer 10

preparing the FS whether the FS were based on a special purpose framework or not

Question 11

The clarified SSARS applicable to preparing the FS apply to:

Answer 11

Preparing a FS forecast
Preparing a BS with substantially all disclosures omitted.
Preparing FS for the review by another accountant (diff firm).

Question 12

SSARS do not apply to:

Answer 12

preparing FS in connection with business valuation services

Question 13

Does an A have to be independent to prepare FSs in accordance with SSARS?

Answer 13

Nein. but need to state that fact in a paragraph at the end of the compilation report

Question 14

What should be added to a report of FS that have been presented using a special purpose framework

Answer 14

An EOM paragraph

Question 15

when engaged to compile an entitys FS,

Answer 15

a compilation report must be issued

Question 16

If an acct is not independent, what services can they provide?

Answer 16

Compilations, but not reviews.

Question 17

What statement is included in a report of a compilation

Answer 17

The acct did not perform any procedures to verify the accuracy or completeness of the info provided by mgmt.

Question 18

The A who was initially engaged to audit, at the clients request, may change the engagement to a compilation if the following are considered:

Answer 18

The reason for the client request.
The additional effort required to complete the audit.
The estimated additional cost to complete the audit.
(the acct should consider carefully whether the new scope restriction will result in info that is incorrect, incomplete, or otherwise unsatisfactory.

Question 19

In a single audit, the general requirements apply to

Answer 19

all federal financial assistance programs

Question 20

Specific requirements apply to

Answer 20

particular federal program and usually arise from statutory requirements

Question 21

GAS require

Answer 21

a report on the entitys compliance with applicable laws and regulations

Question 22

The auditors documentation should contain sufficient info so that…

Answer 22

supplementary oral explanations are not required.

Question 23

What is a subrecipient in A133

Answer 23

a nonfederal entity that expends federal awards received from another entity to carry out a federal program. Received from a passthrough entity

Question 24

An A is required to communicate mgmt’s misappropriation of assets directly to an external party when

Answer 24

the entity fails to make the necessary reports regarding fraud or illegal acts to such parties.

Question 25

An A is resp for assuring that mgmt communicates significant deficiencies to specific legislative and regulatory bodies when

Answer 25

reporting under GAS

Question 26

Auditors are rewuired to report known or likely fraud directly to outside parties when

Answer 26

1. mgmt fails to report such info as required by law
2. when mgmt fails to take timely and appropriate action to respond to fraud, illegal acts, violations, or abuse that is likely to be material to the FS and involved gov agency funding.

Question 27

the A should focus on

Answer 27

violations of law and regulations with a direct and material effect on the FS (bc the A is resp for planning the audit to detect MM in the FS)

Question 28

FS in accordance with GAS require:

Answer 28

An audit report
A report on Internal control.
A report on compliance with laws, reg, and the provision of contracts or grant agreements

Question 29

in an audit of a gov entity an A should

Answer 29

obtain written mgmt representation acknowledging that mgmt has identified and disclosed all laws and regs that have a direct and material effect on its FS

Question 30

GAS do not require a concurrent opinion on the FS taken as a whole

Answer 30

when a performance audit is being conducted

Question 31

What type of assurance does a review provide?

Answer 31

Negative. “Based on our reviews, we are not aware of any material modifications that should be made to the accompanying FS in order for them to be in accordance with acct principles generally accepted in the US.

Question 32

Review - presented on the basis of a special purpose framework

Answer 32

report should include an EOM that identifies the basis of presentation and references a note where the framework is described.

Question 33

If a client asks to change from an audit to a review, the report should state

Answer 33

A review is substantially less in scope than an audit

Question 34

If a client changes from an audit to a review, the report should not ref:

Answer 34

the original agreement.

the scope limitation that caused the changed engagment

Question 35

What kind of opinion would be reported for an entitys FS that contain a material GAAP dept but taken as a whole, the FS are deemed fairly stated

Answer 35

Qualified report for a GAAP departure.

Question 36

at the end of fieldwork, a clients CFO refused to sign the MRL

Answer 36

Disclaimer of opinion

Question 37

Fairly stated, but auditor wishes to draw attention to the doubt of cont as a going concern.

Answer 37

unmodified with an EOM