C) substantive tests of details of transactions while also testing for compliance with controls. In regard to these items, professional standards require the auditor to: In making judgements about materiality at the account balance level, the auditor must consider the relationship between it and materiality at financial report level as a whole. Print test 69 Multiple choice questions. An audit test is a sample taken from a larger population, with the intent of testing the sample for certain characteristics, which are then extrapolated to the entire population. which of the following situations would not impair objectivity, integrity, or independence with respect to an audit client? B) tests of controls that are relevant to multiple assertions. In terms of determining what is a 'significant deficiency' in internal controls, the auditor considers: Which of these is an option that the auditor has to choose from when assessing control risk in an IT environment? b. Over Quizlet. Preliminary work on a time budget for an audit often is involved with: Before using an expert in another profession or occupation, the auditor should be satisfied as to all of the following, except: The decision to accept an audit engagement requires the auditor to undertake a client evaluation. c.Kerry is likely liable to any person who suffered a loss as a result of the fraud. Dual-purpose tests are audit tests designed as: In planning the audit, the auditor should assess materiality at two levels: Professional standards recognise that a misstatement that is quantitatively immaterial may be qualitatively material. Which of the following would not be considered a method of audit sampling? Which is the best of the following options to stop unauthorised users gaining access to computer systems? Which of the following are substantive procedures? Restricting the use of the information system to particular authorised personnel by use of passwords is an example of: Which of the following identifies the five components of internal control? Which of the following audit tests would be regarded as a test of a control? humphrey completes the audit and issues an unqualified opinion. The audit procedures for the subsequent events review can be divided into two categories: (1) procedures normally integrated as a part of the verification of year-end account balances, and (2) those performed specifically for the purpose of discovering subsequent events. acquisition and expenditure activities include 1. purchasing goods and services, 2. receiving the goods or services, 3. recording the asset or expense and related liability, and 4. depreciating assets purchased. to which of the following parties may a CPA partnership provide its audit documentation, without being lawfully subpoenaed or without the client's consent? b. the auditor's checking account, which is fully insured by a federal agency, is held at a client financial institution. four months later, lauren files for bankruptcy. Which of the following is correct relating to risk? Doe hier je beroepskeuzetest! 12/11/2020 Test: CPA - AUD - Hotspot | Quizlet 1/5 5 Written questions 1. four months later, lauren files for bankruptcy. based on the audited financial statements, key largo bank approves the loan to lauren. d. Accounting for unused prenumbered purchase orders and receiving reports. Why is it important to obtain an understanding of the internal control system? Which of these is not one of the steps in the process of understanding the entity's internal control environment and assessing the internal control risk? which of the following is not included in rule of conduct 102, integrity and objectivity? Client evaluations involve: Dealings between a predecessor and proposed auditor normally includes: An auditor has been offered a new audit. key largo bank would most likely sue humphrey claiming, lauren hires humphrey, a cpa, to audit her financial statements. Print test 107 Multiple choice questions. Each of these audit tests are testing a control or control procedure. Which of these would not be considered to be a test of details of balances? The audit program is basically a list of: Extensive tests of details for an income statement account are least likely to be required when: What financial statement assertion is most often tested by CAATs? This is because: Which aspects of substantive testing can an auditor change if the actual level of control risk changes during an assessment of internal control? The procedures the auditor does to obtain an understanding of the entity, includes: The auditor has a statutory legal obligation to report on: When an accounting information system is able to identify and record only the valid transactions of the entity that occurred in the current period, the appropriate assertion(s) would be: Data and procedural controls are a type of: Which of the following can best depict the processing of individual classes of transactions, such as sales, cash receipts, purchases, and cash payments? The auditor plans to use audit sampling to perform tests of details of balances for accounts payable. In evaluating the sample results, the planned control risk will be supported when the projected deviation rate is. The timing of tests of controls should be: In considering the internal auditors' organisational status, the auditor would need to take into account which of the following factors? View Notes - Auditing Chapter 12 Quiz, Chapter 13 Quiz, and Test #2 from AUDITING 4505 at University of Minnesota, Duluth. The auditor would not consider which of the following in considering the effectiveness of the internal auditors? Quickly memorize the terms, phrases and much more. what agency has the ultimate authority in defining independence for public companies? which type of threat most likely results from an auditor's financial interest in a client? The predecessor auditor firm should tell the successor auditor firm: In the investigation of a potential new client, if the client refuses to give permission to inquire of the existing auditor, or if the existing auditor does not respond fully, the prospective auditor should: The exercise of 'due professional care' requires an auditor to: Engagement letters are widely used in practice for professional engagements of all types. Sammy's management tells Kerry that if the misstatement is corrected or if Kerry issues an opinion that indicates there is a material misstatement, Sammy Corp. will likely have to declare bankruptcy and thousands of employees will lose their jobs. which of the following is the responsibility of the professional ethics executive committee? Test out what you know about audits by taking up the audit test below, covering various terminologies and procedures. Matching the vendor's invoice with the related receiving report. You can skip questions if … this is considered... the concept of materiality is least important to an auditor when considering the, c. effects of a direct financial interest in the client on the CPA's independence. Tests of … Call us at 215-675-1400, or send us a message if you have additional questions about … These tests are not investigating the receivables balance in the SOFP. c. make and enforce all the rules of conduct for CPA's who are AICPA members. Quickly memorize the terms, phrases and much more. Karr's field work was completed on Feb. 27 2010, Karrs auditor's report was dated Feb. 28 2010 and was received by the management of Lurch on March 5, 2010. Chapter 5 audit review test for ACCT441. Based on the audited financial statements, Key Largo Bank approves the loan to Lauren. Which of these is not compatible with a high level of inherent and control risk? Which of the following statements is correct? d. julie, a partner in dara & company, with an office in elmhurst. The auditor may assess the control risk as high when: A predominantly substantive audit strategy will: When assessing specific audit objectives for cash at bank, the objective of ensuring that all cash receipts and payments journals are mathematically correct and have been properly posted to the general ledger would mostly serve which assertion? purchases are requisitioned by a purchasing department that seeks the best prices and quality, the accounts payable department reconciles the vendor invoice, purchase order, and receiving report prior to approving the payment to the vendor, bill of landings for goods shipped from a vendor to the purchasing company should always include the company's purchase order number, the receiving department receives a 'blind" copy of the purchase order which does not include the vendor's name and address, the auditor's "search for unrecorded liabilities" should emphasize payments made shortly after the end of the year, auditors should inspect the "unmatched receiving report" file to determine whether the liability for the receipt of goods has been recorded, proper separation of duties involves the purchasing department as the record keeping function, if internal controls over the expenditure cycle are weak, auditors will need to design substantive procedures to try to detect whether control failures have produced misleading financial statement account balances, if the risk of material misstatement is assessed as high, it is likely that additional substantive procedures will be required, the emphasis is on the completeness assertion because financial statement users tend to be more concerned about understated expenses and liabilities than overstated, unrecorded liabilities can be prevented if there is an appropriate segregation of duties in accounts payable, AICPA's conceptual framework for independence. 1. A test of controls for possible disruptions to IT data caused by disasters such as fire or flood is: The relationship between the required understanding of the internal control structure and the preliminary audit strategy is that: Where a test of controls reveals some problems, under what circumstances will the auditor still be able to rely on the control system? elliot corp. is interested in purchasing roger corp. prior to the purchase elliot hired adam & co. to audit the financial statements of roger. A high risk of misstatement is associated with inventory due to the: The auditor would need to be alert for transactions that have occurred with related parties, because: If the predominantly substantive approach preliminary audit strategy is used, planned detection risk will be: If the acceptable level of detection risk decreases, the assurance directly provided from: Which of these is not considered a substantive procedure? Are optional guidelines which an auditor may choose to follow or not follow when conducting an audit. various situations create threats to auditor independence. which of the following philosophical principles in ethics places emphasis on the consequences of action, rather than on following the rules? Start studying Audit Test 2: Multiple Choice. a CPA who is not in public practice is obligated to follow which of the following rules of conduct? 9/16/2016 Test:Chapter14AuditCompletion| Quizlet NAME 8 Multiple choice questions 1. If not, they may need more training or you may need better risk-management policies. They are therefore tests of control. D. The only risk that can be manipulated by the auditor is: The auditor assesses control risk because it: In regard to analytical procedures the correct statements is: An example of 'tracing' a transaction is: An example of 'vouching' a transaction is: An example of a test of details of balances is: A substantive procedure commonly performed prior to the client's balance sheet date is: When using analytical procedures to test accounts receivable, which of these substantive procedures would not be able to be used: The audit procedure that is designed to obtain reasonable assurance that expenses and accruals transactions are recorded in the correct accounting period is: Which of the following substantive audit procedures is to obtain evidence as to the completeness assertion of inventories in the financial report? humphrey completes the audit and issues an unqualified opinion. Quickly memorize the terms, phrases and much more. a CPA is permitted to disclose confidential client information without the consent of the client to. Ben je bang voor vuur? Which risk is controllable by the auditor? In order for an auditor to assess control risk at a low level based on computer application controls, the auditor should test: The types of testing that an auditor can use in a computer information system are: With computer-assisted audit techniques, using the test data approach, it is true that: With computer-assisted audit techniques using an integrated test facility, it is true that: Which of these is not an advantage of parallel simulation? Substantive Tests are procedures designed to test for dollar misstatements that directly affect the correctness of financial statement balances; Substantive tests of transactions are used to determine whether all six transaction related audit objectives have been satisfied for … D) occurrence. Kan je tegen bloed? View Test Prep - Test_ Chapter 14- Audit Completion _ Quizlet from GERMAN 101 at Trident Technical College. The factory manager informed the auditor that this was because the machines were being serviced; however, the auditor saw no evidence of this. Stratification is a way of improving audit efficiency in sampling. Which of the following would not be a possible opinion that the auditor could issue? which of the following is NOT one of the the AICPA principles of professional conduct? If the auditor finds they're in compliance with the rules, that's great. Administrative reporting is the reporting rela-tionship within the organization’s management structure that facilitates the day-to-day opera-tions of the internal audit activity. auditors should not be liable to any party if they perform services that met the standards of, a principle that may reduce or eliminate auditors' liability to clients is. Which auditing procedure is used if auditors want to inspect documents created when transactions were executed, to determine whether or not the information in the documents has been recorded correctly in the accounting records? Copy and Edit View full resource. Karr has audited the F/S of Lurch corporation for the year ended Dec. 31, 2009. Which of the following best describes business risk? C. Tests of the signatures on canceled checks to board of director's authorizations. b. a CPA in public practice providing auditing and other attestation services. 25. Chapter 1: http:/quizlet.com/36008148/audit-exam-practice-flash-cards/ Chapter 2: Print test 102 Multiple choice questions. What is the best way for an auditor to obtain evidence about the controls in relation to 'segregation of duties'? A statistical sampling plan to estimate the proportion of a characteristic in a population is: What audit test do you think would be most appropriate for dollar unit sampling (PPS sampling)? What would be an appropriate sample of invoices to gain reasonable assurance that all payments are properly authorised as part of the annual audit? under the ethical standards of the profession, which of the following investments by a CPA in a corporate client is an internal financial interest? Our online auditing trivia quizzes can be adapted to suit your requirements for taking some of the top auditing quizzes. For which of the following would 'existence' tend not to be appropriate for? Effective monitoring of internal control involves: When an auditor that performs a transaction walk-through review, the procedure used is: The preliminary assessment of internal control risk will normally be high when: Audit risk is commonly assessed within the components: When the auditor's assessment of inherent risk and control risk is high, the resulting detection risk would be: Which risk is the 'possibility that a material misstatement could occur in an assertion, either individually or when aggregated with other misstatements, assuming there are no related controls'? Another audit test focuses on internal controls, which are the procedures a company uses to protect its information from fraud and abuse. Register for free tools and resources Build free Mind Maps, Flashcards, Quizzes and Notes Create, discover and share resources Print & … Which of the following is true regarding audit evidence? Inquiries of warehouse personnel concerning possible obsolete or slow-moving inventories provide assurance about management's assertion of: To verify management's assertion of existence, an auditor would most likely: What is not necessarily required as part of the audit process? which of the following defines the imperative principle of ethics? In the final analysis, the amount and kinds of evidential matter required to support the auditor's opinion should be determined by: The auditor has determined that there is a preponderance of persuasive evidence for each financial statement assertion that is material, and therefore a reasonable basis for their opinion. b. ethics are a function or moral rules and principles. Which of the following have an inverse relationship? maar als het niet klopt, word dan niet al te boos. What is the purpose of the preliminary assessment of control risk? Some special considerations in developing audit programs for initial engagements are: A substantive procedure to obtain evidence as to the presentation and disclosure assertions of inventories in the financial report is: Which of these is most likely to be based on an 'accounting estimate'? An example of a high-risk condition that may provide Incentives/pressures leading to fraudulent financial reporting include: An example of a high-risk condition that may provide a fraudulent financial reporting opportunity includes: What type of risk factor is relevant when misappropriation of assets may occur due to lack of mandatory holidays for employees performing key control functions? The exercise of 'due professional care' requires that an auditor: The statement that is not correct concerning an audit engagement letter is: For most engagements, the auditor makes a preliminary visit to the entity before its year end. 0 Sign In Sign Up for Free Sign Up; Next up. The purpose of using analytical procedures in auditing is to: In performing your analytical review of sales, you find the following information for a company with a 30 June year-end. An auditor need not abide by a particular auditing standard if the auditor … The auditor must obtain sufficient appropriate audit evidence by performing audit procedures to afford a reasonable basis for an opinion regarding the finanical statements under audit. A comprehensive database of more than 37 audit quizzes online, test your knowledge with audit quiz questions. Start studying Audit Test 4. based on the audited financial statements, key largo bank approves a loan to lauren. Lauren would most likely sue Humphrey claiming, failure to provide any level care in fulfilling a duty owed to another party, including reckless disregard for the truth, is called, to prevail in an action brought under common law, the plaintiff must show all of the following except, c. auditors knew the financial statements contained a material misstatement, Lauren hires Humphrey, a CPA, to provide an audit of her financial statements. if elliot sues adam & co., elliot must prove that adam & co. c. failed to exercise the appropriate level of professional care. Learn vocabulary, terms, and more with flashcards, games, and other study tools. according to the standards of the profession, which of the following activities may be required in exercising due professional care? a. auditors must exercise the level of care, skill, and judgement expected of a reasonably prudent auditor under the circumstances. Learn vocabulary, terms, and more with flashcards, games, and other study tools. Beroepskeuzetest! What would most effectively describe the risk of incorrect acceptance in terms of substantive audit testing? 68. Learn vocabulary, terms, and more with flashcards, games, and other study tools. ASA 610 requires that the independent auditor confirm that: Which of the following statements is NOT true? audit risk assessment and related audit plan. the engagement letter includes a statement acknowledging that audited financial statements will be provided to key largo bank for a loan. Which sampling technique could be said to have a similar effect to stratification? Mays sued Hart under the provisions of the 1933 Act that deal with omission of facts required to be in the registration statement. What is the auditor's responsibility in assessing the risk of fraud in planning? Chapter 12 Quiz Review of attempt 1 Started on Tuesday, February 22, 2011, b. an out of town client takes the audit engagement team out to dinner at a renowned local restaurant. 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