Exam 1: CPA Auditing and Attestation Exam

Inquiries of warehouse personnel concerning possible obsolete or slow-moving inventory items provide assurance about management's assertion of:

Lake, CPA, is auditing the financial statements of Gill Co. Gill uses the EDP Service Center, Inc. to process its payroll transactions. EDP's financial statements are audited by Cope, CPA, who recently issued a report on EDP's internal control structure. Lake is considering Cope's report on EDP's internal control structure in assessing control risk on the Gill engagement. What is Lake's responsibility concerning making reference to Cope as a basis, in part, for Lake's own opinion?

An auditor's communication with those charged with governance is required to include the:

Which of the following would an auditor least likely consider with respect to fair values?

An auditor's special report on financial statements prepared in conformity with the cash basis of accounting should include a separate explanatory paragraph before the opinion paragraph that:

The audit documentation that makes up the current file most likely would include a copy of the:

Before reporting on the financial statements of a U.S. entity that have been prepared in conformity with another country's accounting principles, an auditor practicing in the U.S. should:

In evaluating the reasonableness of an entity's accounting estimates, an auditor normally would be concerned about assumptions that are:

An auditor may achieve audit objectives related to particular assertions by:

Which of the following sets of information does an auditor usually confirm on one form?

The scope of an audit is not restricted when an attorney's response to an auditor as a result of a client's letter of audit inquiry limits the response to:

The following data pertain to Cowl, Inc., for the year ended December 31, 20X4: What was Cowl's rate of return on assets for 20X4?

Which of the following statements is a basic element of the auditor's standard report?

Which of the following most likely would be an advantage in using classical variables sampling rather than probability-proportional-to-size (PPS) sampling?

To exercise due professional care an auditor should:

Which of the following factors are included in an entity's control environment?

An auditor's purpose in reviewing the renewal of a note payable shortly after the balance sheet date most likely is to obtain evidence concerning management's assertions about:

An auditor of a manufacturer would most likely question whether that client has committed illegal acts if the client has:

Davis, CPA, believes there is substantial doubt about the ability of Hill Co. to continue as a going concern for a reasonable period of time. In evaluating Hill's plans for dealing with the adverse effects of future conditions and events, Davis most likely would consider, as a mitigating factor, Hill's plans to:

The negative request form of accounts receivable confirmation is useful particularly when the: