Beruflich Dokumente
Kultur Dokumente
ANSWER: C ANSWER: C
2. Which of the following is correct concerning membershipon the 8. Based on the IFAC Code of Ethics for
Public Company Accounting Oversight Board? ProfessionalAccountants,threats to independence arise from all of
a. Only two of its members may be CPAs. thefollowing except:
b. It is composed of nine members. a. Self-interest.
c. All members must also currently be active in publicaccounting. b. Advocacy.
d. A majority of members must be or have been accounting c. The audit relationship.
educators. d. Intimidation.
ANSWER: A ANSWER: C
3. With respect to the acceptance of contingent fees 9. If an audit firm discovers threats to independence withrespectto an
forprofessionalservices, the IFAC Code of Ethics for audit engagement, the IFAC Code of Ethics
ProfessionalAccountantsindicates that the accounting firm forProfessionalAccountants indicates that the firm should
a. Should not accept contingent fees. a. Immediately resign from the engagement.
b. Should establish appropriate safeguards around acceptanceof a b. Notify the appropriate regulatory body.
contingent fee. c. Document the issue.
c. Should accept contingent fees only for assurance servicesother than d. Evaluate the significance of the threats and apply appropriate
audits of financial statements. safeguards to reduce them to an acceptable level.
d. Should accept contingent fees if it is customary in the country.
ANSWER: D
ANSWER: B
10. In all cases, audit reports must
4. The audit partner in charge of an audit of a public company may a. Be signed by the individual who performed the audit procedures.
only b. Certify the accuracy of the quantitative information which was
a. Be in charge of the audit of that one company. audited.
b. Perform the role as long as he or she also performs the c. Communicate the auditor’s finding to the general public.
“second partner review” for that audit. d. Inform readers of the degree of correspondence between the
c. Perform that role for five consecutive years. quantifiable information and the established criteria.
d. Perform the role if he or she has proper AICPA issuer
accreditation. ANSWER: D
ANSWER: C 11. The framework for auditing and related services as addressed by
PSA excludes
5. The Public Company Accounting Oversight Board(PCAOB) is not a. Review
responsible for standards related to b. Compilation
a. Accounting. c. Tax services
b. Attestation. d. Agreed upon procedure
c. Auditing.
d. Quality control. ANSWER: C
ANSWER: A 12. Indicate the level of assurance provided by audit and related
services.
6. A PCAOB engagement that focuses on the sufficiencyof a CPA a b c d
firm’s quality control system is most likely to bereferred to as a(n) Audit High High Negative Absolute
a. Financial statement audit. Review Moderate None Moderate High
b. Inspection. Agreed-upon None None None Limited
c. Peer review. procedures
d. Quality control Compilation None None None None
ANSWER: B ANSWER: A
13. The primary goal of the CPA in performing the attest function is 17. Which statement is correct regarding the relationship between
to internal auditing and the external auditor?
a. Detect fraud a. Some judgments relating to the audit of the financial statements are
b. Examine individual transactions so that the auditor may certify as those of the internal auditor.
to their validity b. The external audit function's objectives vary according to
c. Determine whether the client's assertions are fairly stated management's requirements.
d. Assure the consistent application of correct accounting procedures c. Certain aspects of internal auditing may be useful in determining
the nature, timing and extent of external audit procedures.
ANSWER: C d. The external auditor is responsible for the audit opinion expressed,
however that
14. Assurance engagement responsibility may be reduced by any use made of internal auditing.
a. Is an engagement in which a practitioner is engaged to issue, or
does issue, a written communication that expresses a conclusion ANSWER: C
about the reliability of a written assertion that is the responsibility of
another party. 18. Generally accepted auditing standards are
b. Is a systematic process of objectively obtaining and evaluating a. Required procedures to be used to gather evidence tosupport
evidence regarding assertions about economic actions and events to financial statements.
ascertain the degree of correspondence between those assertions and b. Policies and procedures designed to provide reasonableassurance
established criteria and communicating the results to interested users. that the CPA firm and its personnel complywith professional
c. Is an engagement in which the auditor provides a moderate level of standards.
assurance that the information subject to the engagement is free of c. Pronouncements issued by the Auditing Standards Board.
material misstatement. d. Rules acknowledged by the accounting professionbecause of their
d. Is an engagement intended to enhance the credibility of universal application.
information about a subject matter by evaluating whether the subject
matter conforms in all material respects with suitable criteria, thereby ANSWER: C
improving the likelihood that the information will meet the needs of
an intended user. 19. Which of the following is most likely to be unique tothe audit
work of CPAs as compared to work performed bypractitioners of
ANSWER: D other professions?
a. Due professional care.
15. The criteria for evaluating quantitative information vary. For b. Competence.
example, in the audit of historical financial statements by CPA firms, c. Independence.
the criteria are usually d. Complex body of knowledge.
a. Generally accepted auditing standards.
b. Generally accepted accounting principles. ANSWER: C
c. Regulations of the Bureau of Internal Revenue. 20. According to the standards of the profession, which of
d. Regulations of the Securities and Exchange Commission. thefollowing circumstances will prevent a CPA performing
auditengagements from being independent?
ANSWER: B a. Obtaining a collateralized automobile loan from a
financialinstitution client.
16. Which of the following is an appraisal activity established within b. Litigation with a client relating to billing for consultingservices for
an entity as a service to the entity? which the amount is immaterial.
a. External auditing c. Employment of the CPA’s spouse as a client’s director of internal
b. Financial auditing audit.
c. Internal auditing d. Acting as an honorary trustee for a not-for-profit organization
d. Compliance auditing client.
ANSWER: C ANSWER: C
1. Which of the following is not a financial statement 5. An audit engagement letter least likely includes
assertion relating to account balances? a. A reference to the inherent limitation of an audit that
a. Rights and obligations some material misstatements may remain
b. Existence undiscovered.
c. Completeness b. Identification of specific audit procedures that the
d. Valuation and competence auditor needs to undertake.
c. Description of any letters or reports that the auditor
ANSWER: D expects to submit to the client.
d. Arrangements concerning the involvement of internal
2. The risk that an auditor will conclude, based on substantive auditors and other client’s staff.
tests, that a material misstatement does not exist in an
account balance when, in fact, such misstatement does exist ANSWER: B
is referred to as
a. Detection risk 6. Which of the following actions may be appropriate if the
b. Inherent risk auditor is unable to agree to a change of the engagement
c. Sampling risk and is not permitted to continue the original engagement:
d. Nonsampling risk I. Issue a qualified opinion due to a significant
scope limitation.
ANSWER: A II. Auditor should withdraw from the engagement.
III. Consider whether there is any obligation to report
3. Relationship between control risk and detection risk is to the board of directors or shareholders the
ordinarily circumstances necessitating withdrawal.
a. Direct a. I, II, III
b. Parallel b. I and II
c. Inverse c. II and III
d. Equal d. I only
ANSWER: C ANSWER: C
4. Which of the following statements is not correct about 7. To obtain an understanding of a continuing client’s
materiality? business in planning an audit, an auditor most likely would
a. An auditor’s consideration of materiality is influenced a. Read specialized industry journals
by the auditor’s perception of the needs of a b. Perform tests of details of transactions and balances
reasonable person who will rely on the financial c. Review prior-year working papers and the permanent
statements file for the client.
b. An auditor considers materiality for planning purposes d. Re-evaluate client’s internal control environment.
in terms of the largest aggregate level of
misstatements that could be material to any one of the ANSWER: C
financial statements
c. The concept of materiality recognizes that some 8. Analytical procedures, which means the analysis of
matters are important for fair presentation of financial significant ratios and trends including the resulting
statements in conformity with GAAP, while other investigation of fluctuations and relationships that are
matters are not important. inconsistent with other relevant information or which
d. Materiality judgments are made in light of surrounding deviate from predicted amounts, are not required to be
circumstances and necessarily involve both applied
quantitative and qualitative judgments a. Overall review stage of the audit
b. At the planning stage of the audit
ANSWER: B c. As substantive procedures
d. None of the above
ANSWER: C
9. As the acceptable level of detection risk decreases, the 13. An auditor decides to increase the assessed level of control
assurance directly provided from risk from that originally planned on the basis of audit
a. Substantive tests should decrease. evidence gathered and evaluated. To achieve an overall
b. Tests of controls should increase. audit risk level that is substantially the same as the planned
c. Substantive tests should increase. audit risk level, the auditor would
d. Test of controls should decrease. a. Decrease substantive testing.
b. Decrease detection risk.
ANSWER: C c. Increase materiality levels.
d. Increase inherent risk.
10. When performing a financial statement audit, auditors are
required to explicitly assess the risk of material ANSWER: B
misstatement due to
a. Fraud 14. Which of the following statements is true?
b. Business risk a. If control risk is assessed at maximum, the timing of
c. Illegal acts related substantive tests should be changed from year-
d. Errors end to an interim date.
b. If control risk is assessed at maximum, the extent of
ANSWER: A related substantive tests should be changed from a
larger to smaller sample.
11. An auditor is unable to obtain absolute assurance that c. If control risk is assessed at maximum, the nature of
misstatements due to fraud will be detected for all of the related substantive tests should be changed from more
following except to less effective.
a. Falsified documentation d. If control risk is assessed at maximum, the nature of
b. Employee collusion related substantive tests should be changed from less
c. Professional skepticism to more effective.
d. Need to apply professional judgment in evaluating
fraud risk factors ANSWER: D
ANSWER: B
16. The assessment of the risks of material misstatement at the 20. Which of the following statements is correct concerning an
financial statement level is affected by the auditor’s auditor’s required communication with those charged with
understanding of the control environment. Weaknesses in governance of an audit client?
the control environment ordinarily will lead the auditor to a. This communication is required to occur before the
a. Conduct some audit procedures at an interim date auditor’s report on the financial statements is issued.
rather than at period end. b. Significant audit adjustments proposed by the auditor
b. Have more confidence in internal control and the and recorded by management need not be
reliability of audit evidence generated internally communicated to those charged with governance.
within the entity. c. Any significant matter communicated to the audit
c. Modify the nature of audit procedures to obtain more committee also should be communicated to
persuasive audit evidence. management.
d. Decrease the number of locations to be included in the d. This communication should include discussion of any
audit scope. significant disagreements with management
concerning the financial statements.
ANSWER: C
ANSWER: D
17. The assessment of the risks of material misstatement at the
financial statement level is affected by the auditor’s
understanding of the control environment. Weaknesses in
the control environment ordinarily will lead the auditor to
a. Have more confidence in internal control and the
reliability of audit evidence generated internally
within the entity.
b. Decrease the number of locations to be included in the
audit scope.
c. Conduct some audit procedures at an interim date
rather than at period end.
d. Modify the nature of audit procedures to obtain more
persuasive audit evidence.
ANSWER: D
ANSWER: A
ANSWER: C
1. In assessing the objectivity of a client’s internal auditors, 6. This organization developed a set of criteria that provide
the CPA would be most likely to consider internal auditor. management with a basis to evaluate controls not only over
a. Education levels financial reporting, but also over the effectiveness and
b. Organizational status within the company. efficiency of operations and compliance with laws and
c. Training and supervisory skills. regulations:
d. Experience. a. Financial Accounting Standards Board.
b. Committee of Sponsoring Organizations (COSO).
ANSWER: B c. Foreign Corrupt Practices Corporation.
d. Cohen Commission.
ANSWER: C
10. Which of the following is an advantage of describing 15. Which of the following audit tests would be regarded as a
internal control through the use of a standardized test of a control?
questionnaire? a. Tests of the additions to property, plant, and
a. Questionnaires usually identify situations in which equipment by physical inspection.
internal control weaknesses are compensated for by b. Tests confirming receivables.
other strengths in the system. c. Tests of the signatures on canceled checks to board of
b. Questionnaires are more flexible than other methods director's authorizations.
of describing internal control. d. Tests of the specific items making up the balance in a
c. Questionnaires highlight weaknesses in the system. given general ledger account.
d. Questionnaires provide a clearer and more specific
portrayal of a client's system than other methods of ANSWER: C
describing internal control.
16. In the consideration of internal control, the operating
effectiveness of controls is tested by:
ANSWER: C
a. Substantive procedures.
b. Flowchart verification
11. Which of the following is not a responsibility that should c. Test of controls.
be assigned to a company's internal audit department? d. Decision tables
a. Approving disbursements
b. Evaluating internal control. ANSWER: C
c. Investigating potential merger candidates.
d. Reporting on the effectiveness of operating segments.
17. Which of the following is correct with respect to control
ANSWER: A
deficiencies discovered during an audit?
a. All such matters must be communicated to the audit
12. The internal control provisions of the Sarbanes-Oxley Act committee and regulatory agencies.
of 2002 apply to which companies in the United States:
b. Auditors must communicate and recommend
a. Only those companies included in the Fortune 500. corrections relating to all material weaknesses in
b. All companies. internal control to management.
c. SEC registrants. c. All control deficiencies are also significant
d. All non-public companies. deficiencies.
d. All material weaknesses in internal control should be
ANSWER: C reported to the audit committee.
ANSWER: A
1. Which of the following types of audit evidence is the least 6. In determining whether transactions have been recorded,
persuasive? the direction of the audit testing should be from the
a. Correspondence from the client’s attorney about a. Original source documents.
litigation. b. General journal entries.
b. Bank statements obtained from the client. c. General ledger balances.
c. Test counts of inventory performed by the auditor. d. Adjusted trial balance.
d. Prenumbered purchase order forms.
ANSWER: A
ANSWER: D
7. Which of the following is the best example of a substantive
2. Which of the following types of audit evidence is the most procedure?
persuasive? a. Confirmation of balances of accounts receivable.
a. Client work sheets supporting cost allocations. b. Examining a sample of cash disbursements to test
b. Prenumbered client purchase order forms. whether expenses have been properly approved.
c. Client representation letter. c. Flowcharting of the client’s cash receipts system.
d. Bank statements obtained from the client. d. Comparison of signatures on checks to a list of
authorized signers.
ANSWER: D
ANSWER: A
3. In testing the existence assertion for an asset, an auditor
ordinarily works from the 8. The auditor will most likely perform extensive tests for
a. Financial statements to the potentially unrecorded possible understatement of
items. a. Assets
b. Supporting evidence to the accounting records. b. Revenue
c. Accounting records to the supporting evidence. c. Capital
d. Potentially unrecorded items to the financial d. Liabilities
statements. ANSWER: D
ANSWER: C 9. Which of the following pairs of accounts would an auditor
4. An entity’s income statements were misstated due to the most likely analyze on the same working paper?
recording of journal entries that involved debits and credits a. Accrued interest receivable and accrued interest
to an unusual combination of expense and revenue payable.
accounts. The auditor most likely could have detected this b. Interest income and interest expense.
fraudulent financial reporting by c. Notes payable and notes receivable.
a. Evaluating the effectiveness of internal control. d. Notes receivable and interest income.
b. Performing analytical procedures designed to disclose
differences from expectations. ANSWER: D
c. Tracing a sample of journal entries to the general 10. The permanent file of an auditor’s working papers
ledger. generally would not include
d. Investigating the reconciliations between controlling a. Working trial balance
accounts and subsidiary records. b. Bond indenture agreements
ANSWER: B c. Flowchart of internal control
d. Lease agreements
5. Auditors try to identify predictable relationships when
using analytical procedures. Relationships involving ANSWER: A
transactions from which of the following accounts most 11. The audit working paper that reflects the major components
likely would yield the highest level of evidence? of an amount reported in the financial statements is the
a. Accounts receivable. a. Carryforward schedule
b. Accounts payable. b. Supporting schedule
c. Travel and entertainment expense. c. Interbank transfer schedule
d. Interest Expense. d. Lead schedule
ANSWER: D ANSWER: D
12. Which of the following statements is correct concerning the 17. An advantage of statistical sampling over nonstatistical
use of negative confirmation requests? sampling is that statistical sampling helps an auditor to
a. Unreturned negative confirmation requests indicate a. Measure the sufficiency of the evidential matter
that alternative procedures are necessary. obtained.
b. Negative confirmation requests are effective when b. Reduce the level of audit risk and materiality to a
detection risk is low. relatively low amount.
c. Negative confirmation requests are effective when c. Eliminate nonsampling risk.
understatements of account balances are suspected. d. Minimize the failure to detect errors and frauds.
d. Unreturned negative confirmation requests rarely
provide significant explicit evidence. ANSWER: A
ANSWER: D 18. When the auditor goes through a population and selects
items for the sample without regard to their size, source, or
13. An auditor selected items for test counts while observing a other distinguishing characteristics, it is called
client’s physical inventory. The auditor then traced the test a. Block selection
counts to the client’s inventory listing. This procedure most b. Haphazard selection
likely obtained evidence concerning management’s c. Systematic selection
assertion of d. Random selection
a. Rights
b. Valuation ANSWER: B
c. Existence 19. Which of the following statements is correct?
d. Completeness a. For a given tolerable rate, a larger sample size should
ANSWER: D be selected as the expected population deviation rate
decreases.
14. The auditor is most likely to seek information from the b. As the population size doubles, the sample size also
plant manager with respect to the should double.
a. Deferral of procurement of certain necessary insurance c. The population size has little or no effect on sample
coverage. size except for very small populations.
b. Adequacy of the provision for uncollectible accounts. d. The expected population deviation rate has little or no
c. Appropriateness of physical inventory observation effect on sample size.
procedures.
d. Existence of obsolete machinery. ANSWER: C
ANSWER: A
1. The existence of audit risk is recognized by the statement in 5. When financial statements are affected by a material
the auditor’s standard report that the auditor departure from generally accepted accounting principles,
a. Assesses the accounting principles used and also the auditors should:
evaluates the overall financial statement presentation. a. Issue an unqualified report with an explanatory
b. Realizes some matters, either individually or in the paragraph.
aggregate, are important while other-matters are not b. Issue an "except for" qualification or a disclaimer of
important. opinion.
c. Is responsible for expressing an opinion on the c. Withdraw from the engagement.
financial statements, which are the responsibility of d. Issue an "except for" qualification or an adverse
management. opinion.
d. Obtains reasonable assurance about whether the
financial statements are free of material misstatement. ANSWER: D
ANSWER: A
10. An uncertainty facing the firm relating to the possible 13. Shanti, CPA, audited Dope Co.’s prior year financial
future results of litigation filed against client is most likely statements. These statements are presented with those of
to result in which of the following types of audit report? the current year for comparative purposes without Shanti’s
auditor’s report, which expressed a qualified opinion. In
a. Unqualified with emphasis-of-matter paragraph.
drafting the current year’s auditor’s report, Mau, CPA, the
b. Qualified with a basis for qualification paragraph. successor auditor, should
c. Adverse with a basis for adverse opinion paragraph.
d. Qualified due to a scope limitation. I. Not name Shanti as the predecessor auditor.
ANSWER: C
ANSWER: D
17. Which of the following will not result in qualification of
the auditors' report due to a scope limitation?
a. Reliance placed upon the report of other auditors.
b. Inadequacy in the accounting records.
c. Inability to obtain sufficient competent evidential
matter.
d. Restrictions imposed by the client.
ANSWER: A
ANSWER: C
ANSWER: B
ANSWER: A