Question 1

When the criteria to be used in the financial statement audit is established, the auditor's responsibility is to

Accepted Answer

A)  evaluate the reporting framework used. 
B)  select the acceptable financial reporting framework. 
C)  make a recommendation to management for selecting the framework. 
D)  create and document the framework used. 
A)  evaluate the reporting framework used. 
B)  select the acceptable financial reporting framework. 
C)  make a recommendation to management for selecting the framework. 
D)  create and document the framework used.

Question 2

The first step in the financial statement audit using a risk assessment approach is to

Accepted Answer

A)  identify risks of material misstatement. 
B)  gather evidence to assess the likelihood of material misstatement. 
C)  evaluate audit evidence. 
D)  evaluate the reporting framework. 
A)  identify risks of material misstatement. 
B)  gather evidence to assess the likelihood of material misstatement. 
C)  evaluate audit evidence. 
D)  evaluate the reporting framework.

Question 3

What are the staff levels and responsibilities at Public Accounting firms?

Accepted Answer

1.Partner - Leads the engagement, review

Question 4

The codes of professional conduct of the various accounting bodies are meant to

Accepted Answer

A)  provide a standard of conduct for all members, including those in public practice. 
B)  interpret the assurance recommendations and views of the AASB. 
C)  provide the rules underlying the audits and related service activities carried on by the accountants. 
D)  establish the norms for quality control of an audit. 
A)  provide a standard of conduct for all members, including those in public practice. 
B)  interpret the assurance recommendations and views of the AASB. 
C)  provide the rules underlying the audits and related service activities carried on by the accountants. 
D)  establish the norms for quality control of an audit.

Question 5

There are many elements of quality control at the firm level. Which element does the statement "management within a firm should ensure that qualified personnel monitor and address non-compliance with quality-control procedures" fall under?

Accepted Answer

A)  leadership and responsibilities within the firm 
B)  general ethical requirements 
C)  general human resource policies 
D)  engagement quality control review 
A)  leadership and responsibilities within the firm 
B)  general ethical requirements 
C)  general human resource policies 
D)  engagement quality control review

Question 6

Gary West is a sole practitioner. He has conducted the audit of Reggie's Farm for the past 12 years. In the current year, Reggie's Farm expanded by acquiring two other farms, installed a new accounting system, and also started to export to the United States. Gary accepted the audit of Reggie's Farm for the upcoming year even though he has no experience with exports to the U.S. or companies the size of Reggie's Farm. Which element of quality control is compromised for Gary's firm?

Accepted Answer

A)  independence 
B)  client acceptance or continuance 
C)  extent of professional development 
D)  general ethical requirements 
A)  independence 
B)  client acceptance or continuance 
C)  extent of professional development 
D)  general ethical requirements

Question 7

Approximately how many public accounting firms in Canada have more than 50 professional staff?

Accepted Answer

A)  25 
B)  50 
C)  75 
D)  100 
A)  25 
B)  50 
C)  75 
D)  100

Question 8

The Canada Business Corporation Act gave authority to Canadian accounting and auditing standard-setters by stating that financial statements

Accepted Answer

A)  must be compiled in accordance with International Financial Reporting Standards. 
B)  should be prepared in accordance with the standards in the CPA Canada Handbook. 
C)  must be audited by accountants that reside in Canada. 
D)  should be prepared in accordance with local financial reporting standards. 
A)  must be compiled in accordance with International Financial Reporting Standards. 
B)  should be prepared in accordance with the standards in the CPA Canada Handbook. 
C)  must be audited by accountants that reside in Canada. 
D)  should be prepared in accordance with local financial reporting standards.

Question 9

What is one of the ways that the Canadian Auditing Standards (CASs) make management directly responsible for an organization's financial statements?

Accepted Answer

A)  all listed company management must certify the accuracy of the evidence provided 
B)  management must implement and carry out development of high-quality internal controls 
C)  management must acknowledge and understand its responsibilities 
D)  companies must use internal auditors to assess the quality of the financial statements 
A)  all listed company management must certify the accuracy of the evidence provided 
B)  management must implement and carry out development of high-quality internal controls 
C)  management must acknowledge and understand its responsibilities 
D)  companies must use internal auditors to assess the quality of the financial statements

Question 10

A PA firm has an organizational structure that assures the technical review of every engagement by a partner who has expertise in the client's industry. This is an example of good

Accepted Answer

A)  entity-level controls. 
B)  adherence to professional standards. 
C)  business risk management. 
D)  quality controls. 
A)  entity-level controls. 
B)  adherence to professional standards. 
C)  business risk management. 
D)  quality controls.

Question 11

Which of the following is a typical consequence to a PA or PA firm if practice inspectors find any files or quality control procedures to be unsatisfactory? The PA

Accepted Answer

A)  will lose the right immediately to conduct audit engagements. 
B)  will no longer be allowed to sign audit reports for a period of time (such as a year). 
C)  may be required to revise processes or attend training courses. 
D)  will be required to rewrite the professional qualification examinations. 
A)  will lose the right immediately to conduct audit engagements. 
B)  will no longer be allowed to sign audit reports for a period of time (such as a year). 
C)  may be required to revise processes or attend training courses. 
D)  will be required to rewrite the professional qualification examinations.

Question 12

Stafford & Sandiford is a public accounting firm with 30 clients who are reporting issuers. Stafford & Sandiford can expect to be inspected by the CPAB

Accepted Answer

A)  once per year. 
B)  once every 3 years. 
C)  once every 5 years. 
D)  randomly. 
A)  once per year. 
B)  once every 3 years. 
C)  once every 5 years. 
D)  randomly.

Question 13

CAS 200 explains that as part of general qualifications and conduct, the auditor should exercise due care in the performance of all aspects of auditing. Which of the following is an illustration of due care?

Accepted Answer

A)  having an objective state of mind and independence from the client 
B)  having formal education and practical experience in the conduct of auditing 
C)  issuing a standard audit report using the CPA Canada Handbook specified wording 
D)  considering the completeness of the working papers 
A)  having an objective state of mind and independence from the client 
B)  having formal education and practical experience in the conduct of auditing 
C)  issuing a standard audit report using the CPA Canada Handbook specified wording 
D)  considering the completeness of the working papers

Question 14

The implementation of the Sarbanes-Oxley requirements in the U.S. resulted in increased independence requirements for auditors. The impact of this requirement in Canada was

Accepted Answer

A)  the creation of the CPAB to oversee Canadian audit professionals. 
B)  revisions to the rules of professional conduct for CPAs. 
C)  additional training requirements for becoming an auditor. 
D)  modification of the type of opinion provided in an assurance engagement by an auditor. 
A)  the creation of the CPAB to oversee Canadian audit professionals. 
B)  revisions to the rules of professional conduct for CPAs. 
C)  additional training requirements for becoming an auditor. 
D)  modification of the type of opinion provided in an assurance engagement by an auditor.

Question 15

A PA firm is conducting an audit of a public company that has operations in both Canada and Finland. There is a conflict between ISAs (International Statements on Auditing) and CASs (Canadian Auditing Standards) for the foreign operations that will be consolidated with the Canadian operations. Which reporting standards should the PA firm follow?

Accepted Answer

A)  Finnish reporting standards 
B)  Canadian reporting standards 
C)  international financial reporting standards 
D)  the best of Canadian or international standards 
A)  Finnish reporting standards 
B)  Canadian reporting standards 
C)  international financial reporting standards 
D)  the best of Canadian or international standards

Question 16

Farah is currently auditing Software Synx, a public company. After a long day of work, Farah goes for a drink with her friend John who mentions that he owns shares of Software Synx. Farah indicates that John should hold on to his shares as they will go up next week when the financial statements are released and show an increase of 12% for revenues. Which element of quality control is compromised by Farah?

Accepted Answer

A)  general ethical requirements 
B)  independence 
C)  general human resource policies 
D)  engagement performance 
A)  general ethical requirements 
B)  independence 
C)  general human resource policies 
D)  engagement performance

Question 17

What is one of the ways that the Canadian Auditing Standards (CASs) make management directly responsible for an organization's financial statements?

Accepted Answer

A)  all listed company management must certify the accuracy of the evidence provided 
B)  management must provide evidence to support financial statement data 
C)  management must implement and carry out development of high-quality internal controls 
D)  companies must use internal auditors to assess the quality of the financial statements 
A)  all listed company management must certify the accuracy of the evidence provided 
B)  management must provide evidence to support financial statement data 
C)  management must implement and carry out development of high-quality internal controls 
D)  companies must use internal auditors to assess the quality of the financial statements

Question 18

Most international and national accounting firms in Canada are comprised of professional accountants with the designation

Accepted Answer

A)  CIA. 
B)  CPA. 
C)  CFE. 
D)  CISA. 
A)  CIA. 
B)  CPA. 
C)  CFE. 
D)  CISA.

Question 19

The most authoritative requirements for public accountants performing financial statement audits in Canada are the

Accepted Answer

A)  standards used by the client. 
B)  industry specific standards. 
C)  CPA Canada handbook requirements. 
D)  assurance guidelines. 
A)  standards used by the client. 
B)  industry specific standards. 
C)  CPA Canada handbook requirements. 
D)  assurance guidelines.

Question 20

CPA Canada is the professional accounting organization for Chartered Professional Accountants (CPAs) in Canada. Describe the role and responsibilities of the organization in serving its members.

Accepted Answer

Research and Publication: CPA Canada pub

When the criteria to be used in the financial statement audit is established, the auditor's responsibility is to

The first step in the financial statement audit using a risk assessment approach is to

What are the staff levels and responsibilities at Public Accounting firms?

The codes of professional conduct of the various accounting bodies are meant to

There are many elements of quality control at the firm level. Which element does the statement "management within a firm should ensure that qualified personnel monitor and address non-compliance with quality-control procedures" fall under?

Approximately how many public accounting firms in Canada have more than 50 professional staff?

The Canada Business Corporation Act gave authority to Canadian accounting and auditing standard-setters by stating that financial statements

What is one of the ways that the Canadian Auditing Standards (CASs) make management directly responsible for an organization's financial statements?

A PA firm has an organizational structure that assures the technical review of every engagement by a partner who has expertise in the client's industry. This is an example of good

Which of the following is a typical consequence to a PA or PA firm if practice inspectors find any files or quality control procedures to be unsatisfactory? The PA

Stafford & Sandiford is a public accounting firm with 30 clients who are reporting issuers. Stafford & Sandiford can expect to be inspected by the CPAB

CAS 200 explains that as part of general qualifications and conduct, the auditor should exercise due care in the performance of all aspects of auditing. Which of the following is an illustration of due care?

The implementation of the Sarbanes-Oxley requirements in the U.S. resulted in increased independence requirements for auditors. The impact of this requirement in Canada was

What is one of the ways that the Canadian Auditing Standards (CASs) make management directly responsible for an organization's financial statements?

Most international and national accounting firms in Canada are comprised of professional accountants with the designation

The most authoritative requirements for public accountants performing financial statement audits in Canada are the

CPA Canada is the professional accounting organization for Chartered Professional Accountants (CPAs) in Canada. Describe the role and responsibilities of the organization in serving its members.

The Demand for Audit and Other Assurance Services

Legal Liability

Professional Judgment and Ethics

Audit Responsibilities and Objectives

Client Acceptance and Planning the Audit

Materiality and Risk

Internal Controls and Control Risk

Audit Evidence

Audit Strategy and Audit Program

Audit Sampling Concepts

Audit of the Revenue Cycle

Audit of the Acquisition and Payment Cycle

Audit of the Inventory and Distribution Cycle

Audit of the Human Resources and Payroll Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash Balances

Completing the Audit

Audit Reports on Financial Statements

Other Assurance and Nonassurance Services

Filters

Exam 2: The Public Accounting Profession and Audit Quality

When the criteria to be used in the financial statement audit is established, the auditor's responsibility is to

The first step in the financial statement audit using a risk assessment approach is to

What are the staff levels and responsibilities at Public Accounting firms?

The codes of professional conduct of the various accounting bodies are meant to

There are many elements of quality control at the firm level. Which element does the statement "management within a firm should ensure that qualified personnel monitor and address non-compliance with quality-control procedures" fall under?

Approximately how many public accounting firms in Canada have more than 50 professional staff?

The Canada Business Corporation Act gave authority to Canadian accounting and auditing standard-setters by stating that financial statements

What is one of the ways that the Canadian Auditing Standards (CASs) make management directly responsible for an organization's financial statements?

A PA firm has an organizational structure that assures the technical review of every engagement by a partner who has expertise in the client's industry. This is an example of good

Which of the following is a typical consequence to a PA or PA firm if practice inspectors find any files or quality control procedures to be unsatisfactory? The PA

Stafford & Sandiford is a public accounting firm with 30 clients who are reporting issuers. Stafford & Sandiford can expect to be inspected by the CPAB

CAS 200 explains that as part of general qualifications and conduct, the auditor should exercise due care in the performance of all aspects of auditing. Which of the following is an illustration of due care?

The implementation of the Sarbanes-Oxley requirements in the U.S. resulted in increased independence requirements for auditors. The impact of this requirement in Canada was

What is one of the ways that the Canadian Auditing Standards (CASs) make management directly responsible for an organization's financial statements?

Most international and national accounting firms in Canada are comprised of professional accountants with the designation

The most authoritative requirements for public accountants performing financial statement audits in Canada are the

CPA Canada is the professional accounting organization for Chartered Professional Accountants (CPAs) in Canada. Describe the role and responsibilities of the organization in serving its members.

The Demand for Audit and Other Assurance Services

Legal Liability

Professional Judgment and Ethics

Audit Responsibilities and Objectives

Client Acceptance and Planning the Audit

Materiality and Risk

Internal Controls and Control Risk

Audit Evidence

Audit Strategy and Audit Program

Audit Sampling Concepts

Audit of the Revenue Cycle

Audit of the Acquisition and Payment Cycle

Audit of the Inventory and Distribution Cycle

Audit of the Human Resources and Payroll Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash Balances

Completing the Audit

Audit Reports on Financial Statements

Other Assurance and Nonassurance Services

Filters