Question 1

In response to the growing need for assurance resulting from the explosion of business transacted electronically over the Internet, the AICPA created:

Accepted Answer

A)  AICPA WebPartner Assurance Services. 
B)  Webtrust Assurance Services. 
C)  Information System Reliability Services. 
D)  Internet Reliability Assurance Services. 
A)  AICPA WebPartner Assurance Services. 
B)  Webtrust Assurance Services. 
C)  Information System Reliability Services. 
D)  Internet Reliability Assurance Services.

Question 2

Which one of the following services provides a moderate level of assurance about the client's financial statements?

Accepted Answer

A)  forecasts and projections 
B)  review 
C)  audit 
D)  compliance 
A)  forecasts and projections 
B)  review 
C)  audit 
D)  compliance

Question 3

Which of the following is a form of evidence used by auditors?

Accepted Answer

A)  the auditor's own observations 
B)  oral statements from the audit client 
C)  written communication obtained from entities outside the audit client 
D)  all of the above 
A)  the auditor's own observations 
B)  oral statements from the audit client 
C)  written communication obtained from entities outside the audit client 
D)  all of the above

Question 4

Making recommendations for improving operational performance is an objective of:

Accepted Answer

A)  a tax-planning engagement. 
B)  a performance audit. 
C)  an attestation engagement. 
D)  a financial statement audit. 
A)  a tax-planning engagement. 
B)  a performance audit. 
C)  an attestation engagement. 
D)  a financial statement audit.

Question 5

As businesses become more complex and need more reliable information, public accountants play a vital role in:

Accepted Answer

A)  providing tax services. 
B)  providing business advisory services. 
C)  providing assurance on information other than financial reports. 
D)  all of the above 
A)  providing tax services. 
B)  providing business advisory services. 
C)  providing assurance on information other than financial reports. 
D)  all of the above

Question 6

The International Standards on Auditing (ISAs)are issued by:

Accepted Answer

A)  International Institute of Internal Auditors. 
B)  International Quality Control Association. 
C)  International Federation of Accountants. 
D)  United States Securities and Exchange Commission. 
A)  International Institute of Internal Auditors. 
B)  International Quality Control Association. 
C)  International Federation of Accountants. 
D)  United States Securities and Exchange Commission.

Question 7

The criteria for evaluating quantitative information vary.For example, in the audit of historical financial statements by public accounting firms, the criteria are usually:

Accepted Answer

A)  regulations of the Australian Taxation Office. 
B)  regulations of the Australian Securities and Investment Commission. 
C)  applicable accounting standards. 
D)  generally accepted auditing standards. 
A)  regulations of the Australian Taxation Office. 
B)  regulations of the Australian Securities and Investment Commission. 
C)  applicable accounting standards. 
D)  generally accepted auditing standards.

Question 8

Business performance measurement services involve:

Accepted Answer

A)  the board of directors and managers using a balanced scorecard to define an entity's financial objectives and goals. 
B)  assurance about whether nonfinancial information being reported from the entity's performance measurement system is reliable. 
C)  assurance about whether financial and nonfinancial information being reported from the entity's performance measurement system is reliable. 
D)  none of the above 
A)  the board of directors and managers using a balanced scorecard to define an entity's financial objectives and goals. 
B)  assurance about whether nonfinancial information being reported from the entity's performance measurement system is reliable. 
C)  assurance about whether financial and nonfinancial information being reported from the entity's performance measurement system is reliable. 
D)  none of the above

Question 9

Firms providing audit services can be incorporated provided:

Accepted Answer

A)  all partners are listed as directors. 
B)  they are not large partnerships. 
C)  they obtain appropriate and adequate professional indemnity insurance. 
D)  the total income of the audit firm is above $2M. 
A)  all partners are listed as directors. 
B)  they are not large partnerships. 
C)  they obtain appropriate and adequate professional indemnity insurance. 
D)  the total income of the audit firm is above $2M.

Question 10

Which one of the following statements is NOT true about audit reports?

Accepted Answer

A)  They are prepared as the final stage of the audit process. 
B)  They differ in nature. 
C)  They communicate the auditor's findings to users. 
D)  They all follow the same form. 
A)  They are prepared as the final stage of the audit process. 
B)  They differ in nature. 
C)  They communicate the auditor's findings to users. 
D)  They all follow the same form.

Question 11

When a business contacts an auditor for a service providing no assurances, what type of engagement is being requested?

Accepted Answer

A)  Audit 
B)  Tax Planning 
C)  Review 
D)  Compliance 
A)  Audit 
B)  Tax Planning 
C)  Review 
D)  Compliance

Question 12

Auditors are valued for their experience in assisting companies to improve operations and:

Accepted Answer

A)  independence in providing assurances. 
B)  technical knowledge. 
C)  competence. 
D)  all of the above 
A)  independence in providing assurances. 
B)  technical knowledge. 
C)  competence. 
D)  all of the above

Question 13

Which of the following is classified as an attestation service?

Accepted Answer

A)  Compilation 
B)  Tax planning engagement 
C)  Consulting engagement 
D)  Audit of historical financial statements 
A)  Compilation 
B)  Tax planning engagement 
C)  Consulting engagement 
D)  Audit of historical financial statements

Question 14

Discuss the impact of e-commerce on public accountants.

Accepted Answer

Almost all businesses rely on informatio

Question 15

Discuss the similarities and differences between the roles of independent auditors, officers serving the Auditor-General, taxation auditors, and internal auditors.

Accepted Answer

The roles of all four types of auditors

Question 16

If an auditor has determined that the client has an excellent internal control structure:

Accepted Answer

A)  business risk is significantly reduced. 
B)  the type of evidence required changes, but not the quantity. 
C)  the amount of audit evidence to be collected might be reduced relative to a situation where the control structure is not adequate. 
D)  the auditor can conclude that there is reasonable assurance that the financial statements do not contain material misstatements. 
A)  business risk is significantly reduced. 
B)  the type of evidence required changes, but not the quantity. 
C)  the amount of audit evidence to be collected might be reduced relative to a situation where the control structure is not adequate. 
D)  the auditor can conclude that there is reasonable assurance that the financial statements do not contain material misstatements.

Question 17

An audit to determine whether the auditee is following specific procedures or rules set down by some higher authority is classified as:

Accepted Answer

A)  an operational audit. 
B)  a compliance audit. 
C)  a production audit. 
D)  an audit of financial statements. 
A)  an operational audit. 
B)  a compliance audit. 
C)  a production audit. 
D)  an audit of financial statements.

Question 18

'Other assurance services' are similar to, yet differ somewhat from, attestation services.When performing 'other assurance services,' the public accountant:

Accepted Answer

A)  is not required to issue a written report, and the assurance is about the reliability and relevance of information. 
B)  is required to issue a written report, and the assurance is about the completeness and sufficiency of information. 
C)  is not required to issue a written report, and the assurance is about the completeness and sufficiency of information. 
D)  is required to issue a written report, and the assurance is about the reliability and relevance of information. 
A)  is not required to issue a written report, and the assurance is about the reliability and relevance of information. 
B)  is required to issue a written report, and the assurance is about the completeness and sufficiency of information. 
C)  is not required to issue a written report, and the assurance is about the completeness and sufficiency of information. 
D)  is required to issue a written report, and the assurance is about the reliability and relevance of information.

Question 19

What is a by-product of an audit in regards to information risk?

Accepted Answer

A)  increases the amount of available capital 
B)  lowers the cost of obtaining capital 
C)  increases the level of information risk 
D)  increases the cost of obtaining capital 
A)  increases the amount of available capital 
B)  lowers the cost of obtaining capital 
C)  increases the level of information risk 
D)  increases the cost of obtaining capital

Question 20

The main purpose of the Corporations Act is to:

Accepted Answer

A)  develop and promulgate approved accounting standards. 
B)  establish appropriate corporate governance mechanisms to promote appropriate decision making by participants and managerial accountability to shareholders. 
C)  give legislative backing to the Australian Securities Exchange's Listing Rules. 
D)  ensure that auditors conducting financial statement audits are registered. 
A)  develop and promulgate approved accounting standards. 
B)  establish appropriate corporate governance mechanisms to promote appropriate decision making by participants and managerial accountability to shareholders. 
C)  give legislative backing to the Australian Securities Exchange's Listing Rules. 
D)  ensure that auditors conducting financial statement audits are registered.

In response to the growing need for assurance resulting from the explosion of business transacted electronically over the Internet, the AICPA created:

Which one of the following services provides a moderate level of assurance about the client's financial statements?

Which of the following is a form of evidence used by auditors?

Making recommendations for improving operational performance is an objective of:

As businesses become more complex and need more reliable information, public accountants play a vital role in:

The International Standards on Auditing (ISAs)are issued by:

The criteria for evaluating quantitative information vary.For example, in the audit of historical financial statements by public accounting firms, the criteria are usually:

Business performance measurement services involve:

Firms providing audit services can be incorporated provided:

Which one of the following statements is NOT true about audit reports?

When a business contacts an auditor for a service providing no assurances, what type of engagement is being requested?

Auditors are valued for their experience in assisting companies to improve operations and:

Which of the following is classified as an attestation service?

Discuss the impact of e-commerce on public accountants.

Discuss the similarities and differences between the roles of independent auditors, officers serving the Auditor-General, taxation auditors, and internal auditors.

If an auditor has determined that the client has an excellent internal control structure:

An audit to determine whether the auditee is following specific procedures or rules set down by some higher authority is classified as:

'Other assurance services' are similar to, yet differ somewhat from, attestation services.When performing 'other assurance services,' the public accountant:

What is a by-product of an audit in regards to information risk?

The main purpose of the Corporations Act is to:

Auditors’ legal environment

Audit quality and ethics

Audit responsibilities and objectives

Audit evidence

Audit planning and documentation

Materiality and risk

Internal control and control risk

Fraud auditing

The impact of information technology on the audit process

Overall audit plan and audit program

Audit of the sales and collection cycle: Tests of controls and substantive tests of transactions

Completing tests in the sales and collection cycle: Accounts receivable

Audit sampling

Audit of transaction cycles and financial statement balances I

Audit of transaction cycles and financial statement balances II

Completing the audit

Audit reporting

Other auditing and assurance engagements

Filters

Exam 1: Demand for audit and assurance services

In response to the growing need for assurance resulting from the explosion of business transacted electronically over the Internet, the AICPA created:

Which one of the following services provides a moderate level of assurance about the client's financial statements?

Which of the following is a form of evidence used by auditors?

Making recommendations for improving operational performance is an objective of:

As businesses become more complex and need more reliable information, public accountants play a vital role in:

The International Standards on Auditing (ISAs)are issued by:

The criteria for evaluating quantitative information vary.For example, in the audit of historical financial statements by public accounting firms, the criteria are usually:

Business performance measurement services involve:

Firms providing audit services can be incorporated provided:

Which one of the following statements is NOT true about audit reports?

When a business contacts an auditor for a service providing no assurances, what type of engagement is being requested?

Auditors are valued for their experience in assisting companies to improve operations and:

Which of the following is classified as an attestation service?

Discuss the impact of e-commerce on public accountants.

Discuss the similarities and differences between the roles of independent auditors, officers serving the Auditor-General, taxation auditors, and internal auditors.

If an auditor has determined that the client has an excellent internal control structure:

An audit to determine whether the auditee is following specific procedures or rules set down by some higher authority is classified as:

'Other assurance services' are similar to, yet differ somewhat from, attestation services.When performing 'other assurance services,' the public accountant:

What is a by-product of an audit in regards to information risk?

The main purpose of the Corporations Act is to:

Auditors’ legal environment

Audit quality and ethics

Audit responsibilities and objectives

Audit evidence

Audit planning and documentation

Materiality and risk

Internal control and control risk

Fraud auditing

The impact of information technology on the audit process

Overall audit plan and audit program

Audit of the sales and collection cycle: Tests of controls and substantive tests of transactions

Completing tests in the sales and collection cycle: Accounts receivable

Audit sampling

Audit of transaction cycles and financial statement balances I

Audit of transaction cycles and financial statement balances II

Completing the audit

Audit reporting

Other auditing and assurance engagements

Filters