Quiz #9

I. Multiple choice

1. B
2. A
3. D
4. B
5. A
6. C
7. D
8. C
9. A
10. C

II. Essay II

Between the risk based audit and the account based audit, I would say that the one which
is more practicable is the risk based audit.

So, when we look at the risk based audit, we find that it focuses on the level at which the
process of auditing seeks to find and identify the risks with the greatest potential impact
which means that it would specify the transactions that would make up the financial
statements with surety and to the extent that these statements would reveal the level of
risk management and the realm of those risks being able to have impact on the entity
being audited. This is unlike the account based audit in the sense that the account based
audit only considers the tests that are needed to be carried out on the items on the
financial statements with less viability of reveling the impact of the risks in the audit
process. The predictability is based on the impact that can be depicted from the financial
statements and from this, it is why the risk based audit becomes more predictable than the
account based audit.