Question 1

The notion of proximity:

Accepted Answer

A)  is separate from consideration of reasonable reliance. 
B)  has a precise legal definition. 
C)  can relate to nonspecific third parties. 
D)  is not separate from foreseeability. 
A)  is separate from consideration of reasonable reliance. 
B)  has a precise legal definition. 
C)  can relate to nonspecific third parties. 
D)  is not separate from foreseeability.

Question 2

Does the auditing profession in Australia register public company auditors?

Accepted Answer

No.To be appointed as a registered audit

Question 3

What are two areas of liability in auditing?

Accepted Answer

A)  professional liability and criminal liability 
B)  criminal liability and liability under statutory law 
C)  professional liability and liability under common law 
D)  criminal liability and corporate liability 
A)  professional liability and criminal liability 
B)  criminal liability and liability under statutory law 
C)  professional liability and liability under common law 
D)  criminal liability and corporate liability

Question 4

Identify the four tests that a plaintiff must satisfy in order to recover damages against the auditor.

Accepted Answer

1.The auditor owed a duty of c

Question 5

While performing services for their clients, auditors, as professionals, have a duty to provide a level of care which is:

Accepted Answer

A)  free from judgement errors. 
B)  superior to that of other auditors. 
C)  reasonable. 
D)  greater than the average auditor. 
A)  free from judgement errors. 
B)  superior to that of other auditors. 
C)  reasonable. 
D)  greater than the average auditor.

Question 6

In the Esanda Finance Corporation Ltd v Peat Hungerfords case, the court:

Accepted Answer

A)  confirmed the auditors' duties as stated in the Pacific Acceptance case. 
B)  stated the auditors were aware of the intention of the third party's reliance on the audit report. 
C)  stated auditors must undertake the audit with reasonable skill and care. 
D)  all of the above 
A)  confirmed the auditors' duties as stated in the Pacific Acceptance case. 
B)  stated the auditors were aware of the intention of the third party's reliance on the audit report. 
C)  stated auditors must undertake the audit with reasonable skill and care. 
D)  all of the above

Question 7

The AGC case added which one of the following criteria to the tests determining whether a duty of care is owed to a third party?

Accepted Answer

A)  prevailing community standards 
B)  purpose of reliance must be known 
C)  intention to induce 
D)  user must be known 
A)  prevailing community standards 
B)  purpose of reliance must be known 
C)  intention to induce 
D)  user must be known

Question 8

The AWA case and the Pacific Acceptance case discussed:

Accepted Answer

A)  client acceptance. 
B)  the duty to inform management. 
C)  privity letters. 
D)  management representation letters. 
A)  client acceptance. 
B)  the duty to inform management. 
C)  privity letters. 
D)  management representation letters.

Question 9

A 'negligence calculus' has four components.Which of the following is NOT a component?

Accepted Answer

A)  likely seriousness of harm 
B)  taking precautions to avoid harm 
C)  taking out insurance against causing harm 
D)  probability of harm occurring 
A)  likely seriousness of harm 
B)  taking precautions to avoid harm 
C)  taking out insurance against causing harm 
D)  probability of harm occurring

The notion of proximity:

Does the auditing profession in Australia register public company auditors?

What are two areas of liability in auditing?

Identify the four tests that a plaintiff must satisfy in order to recover damages against the auditor.

While performing services for their clients, auditors, as professionals, have a duty to provide a level of care which is:

In the Esanda Finance Corporation Ltd v Peat Hungerfords case, the court:

The AGC case added which one of the following criteria to the tests determining whether a duty of care is owed to a third party?

The AWA case and the Pacific Acceptance case discussed:

A 'negligence calculus' has four components.Which of the following is NOT a component?

Demand for audit and assurance services

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 2: Auditors’ legal environment

The notion of proximity:

Does the auditing profession in Australia register public company auditors?

What are two areas of liability in auditing?

Identify the four tests that a plaintiff must satisfy in order to recover damages against the auditor.

While performing services for their clients, auditors, as professionals, have a duty to provide a level of care which is:

In the Esanda Finance Corporation Ltd v Peat Hungerfords case, the court:

The AGC case added which one of the following criteria to the tests determining whether a duty of care is owed to a third party?

The AWA case and the Pacific Acceptance case discussed:

A 'negligence calculus' has four components.Which of the following is NOT a component?

Demand for audit and assurance services

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