Question 1

The legal right to perform audits is granted to a CPA firm by regulation of

Accepted Answer

A) each state. 
B) the Financial Accounting Standards Board (FAS
B) . 
C) the American Institute of Certified Public Accountants (AICP
A) . 
D) the Auditing Standards Board. 
A) each state. 
B) the Financial Accounting Standards Board (FAS
B) . 
C) the American Institute of Certified Public Accountants (AICP
A) . 
D) the Auditing Standards Board.

Question 2

The PCAOB considers International Standards on Auditing (ISA)when developing its standards.

Accepted Answer

A) True 
 B)False

Question 3

The Public Company Accounting Oversight Board

Accepted Answer

A) performs inspections of the quality controls of firms that audit public companies. 
B) establishes auditing standards that must be followed by CPAs on all audits. 
C) oversees auditors of private companies. 
D) performs all of the above functions. 
A) performs inspections of the quality controls of firms that audit public companies. 
B) establishes auditing standards that must be followed by CPAs on all audits. 
C) oversees auditors of private companies. 
D) performs all of the above functions.

Question 4

The form that must be completed and filed with the Securities and Exchange Commission whenever a company experiences a significant event that is of interest to public investors is the

Accepted Answer

A) Form S-1. 
B) Form 8-K. 
C) Form 10-K. 
D) Form 10-Q. 
A) Form S-1. 
B) Form 8-K. 
C) Form 10-K. 
D) Form 10-Q.

Question 5

List and describe the three factors that influence the organizational structure of all CPA firms.What are the most common forms of CPA firm organization?

Accepted Answer

The three factors that influence the org

Question 6

Which of the following statements is True as it relates to limited liability partnerships?

Accepted Answer

A) Only senior partners are liable for the partnerships debts. 
B) Partners have no liability in a limited liability partnership arrangement. 
C) Partners are personally liable for the acts of those under their supervision. 
D) All partners must be AICPA members. 
A) Only senior partners are liable for the partnerships debts. 
B) Partners have no liability in a limited liability partnership arrangement. 
C) Partners are personally liable for the acts of those under their supervision. 
D) All partners must be AICPA members.

Question 7

Members of the Public Company Accounting Oversight Board are appointed and overseen by the

Accepted Answer

A) U)S.Congress. 
B) American Institute of Certified Public Accountants. 
C) Auditing Standards Board. 
D) Securities and Exchange Commission. 
A) U)S.Congress. 
B) American Institute of Certified Public Accountants. 
C) Auditing Standards Board. 
D) Securities and Exchange Commission.

Question 8

The ASB has revised its audit standards to converge with international standards.

Accepted Answer

A) True 
 B)False

Question 9

Statements on Standards for Accounting and Review Services (SSARS)are issued by the

Accepted Answer

A) Accounting and Review Services Committee. 
B) Professional Ethics Executive Committee. 
C) Securities and Exchange Commission. 
D) Financial Accounting Standards Board. 
A) Accounting and Review Services Committee. 
B) Professional Ethics Executive Committee. 
C) Securities and Exchange Commission. 
D) Financial Accounting Standards Board.

Question 10

Discuss the relationship between quality control and generally accepted auditing standards.

Accepted Answer

For a CPA firm,quality control comprises

Question 11

Which of the following is an accurate statement regarding principles and auditing standards?

Accepted Answer

A) The principles underlying an audit give specific guidance to an auditor when a problem arises in an audit. 
B) The principles underlying an audit state that the only objective of an audit is to provide financial statement users with an opinion. 
C) All auditing standards issued by the PCAOB are given two classification numbers. 
D) The SAS number identifies the order in which it was issued in relation to other SASs. 
A) The principles underlying an audit give specific guidance to an auditor when a problem arises in an audit. 
B) The principles underlying an audit state that the only objective of an audit is to provide financial statement users with an opinion. 
C) All auditing standards issued by the PCAOB are given two classification numbers. 
D) The SAS number identifies the order in which it was issued in relation to other SASs.

Question 12

The American Institute of Certified Public Accountants (AICPA)

Accepted Answer

A) is responsible for issuing licenses to new CPAs. 
B) restricts its membership to CPAs who are independent auditors. 
C) sets auditing standards for both public and private companies. 
D) sets rules of conduct that CPAs are required to meet. 
A) is responsible for issuing licenses to new CPAs. 
B) restricts its membership to CPAs who are independent auditors. 
C) sets auditing standards for both public and private companies. 
D) sets rules of conduct that CPAs are required to meet.

Question 13

A CPA must meet continuing education requirements to maintain their license to practice.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following statements about Generally Accepted Audit Standards are True?
I. They serve as broad guidelines to auditors for conducting an audit engagement.
II. They are sufficiently specific to provide any meaningful guide to practitioners.
III. They represent a framework upon which the AICPA can provide interpretations.

Accepted Answer

A) I and II 
B) I and III 
C) II and III 
D) I,II and III 
A) I and II 
B) I and III 
C) II and III 
D) I,II and III

Question 15

Assume the Public Company Accounting Oversight Board (PCAOB)identifies a violation during its inspection of a registered accounting firm.The PCAOB

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 16

Which of the following is an element of the CPA's quality control system that should be considered in establishing its quality control policies and procedures?

Accepted Answer

A) considering audit risk and materiality 
B) using statistical sampling techniques 
C) assigning personnel to engagements 
D) complying with laws and regulations 
A) considering audit risk and materiality 
B) using statistical sampling techniques 
C) assigning personnel to engagements 
D) complying with laws and regulations

Question 17

The form that must be filed with the Securities and Exchange Commission whenever a company plans to issue new securities to the public is the

Accepted Answer

A) Form S-1. 
B) Form 8-K. 
C) Form 10-K. 
D) Form 10-Q. 
A) Form S-1. 
B) Form 8-K. 
C) Form 10-K. 
D) Form 10-Q.

Question 18

In which type of service does the CPA assemble the financial statements but provide no assurance to third parties?

Accepted Answer

A) audit 
B) compilation 
C) review 
D) bookkeeping 
A) audit 
B) compilation 
C) review 
D) bookkeeping

Question 19

________ are referred to as U.S.generally accepted auditing standards (GAAS).

Accepted Answer

A) AICPA auditing standards 
B) SEC auditing standards 
C) PCAOB auditing standards 
D) Sarbanes-Oxley standards 
A) AICPA auditing standards 
B) SEC auditing standards 
C) PCAOB auditing standards 
D) Sarbanes-Oxley standards

Exam 2: The Cpa Profession

The legal right to perform audits is granted to a CPA firm by regulation of

The PCAOB considers International Standards on Auditing (ISA)when developing its standards.

The Public Company Accounting Oversight Board

The form that must be completed and filed with the Securities and Exchange Commission whenever a company experiences a significant event that is of interest to public investors is the

List and describe the three factors that influence the organizational structure of all CPA firms.What are the most common forms of CPA firm organization?

Which of the following statements is True as it relates to limited liability partnerships?

Members of the Public Company Accounting Oversight Board are appointed and overseen by the

The ASB has revised its audit standards to converge with international standards.

Statements on Standards for Accounting and Review Services (SSARS)are issued by the

Discuss the relationship between quality control and generally accepted auditing standards.

Which of the following is an accurate statement regarding principles and auditing standards?

The American Institute of Certified Public Accountants (AICPA)

A CPA must meet continuing education requirements to maintain their license to practice.

Assume the Public Company Accounting Oversight Board (PCAOB)identifies a violation during its inspection of a registered accounting firm.The PCAOB

Which of the following is an element of the CPA's quality control system that should be considered in establishing its quality control policies and procedures?

The form that must be filed with the Securities and Exchange Commission whenever a company plans to issue new securities to the public is the

In which type of service does the CPA assemble the financial statements but provide no assurance to third parties?

________ are referred to as U.S.generally accepted auditing standards (GAAS).

The Demand for Audit and Other Assurance Services

Audit Reports

Professional Ethics

Legal Liability

Audit Responsibilities and Objectives

Audit Evidence

Audit Planning and Analytical Procedures

Materiality and Risk

Fraud Auditing

Internal Control and Coso Framework

Assessing Control Risk and Reporting on Internal Controls

Overall Audit Strategy and Audit Program

Audit of the Sales and Collection Cycle: Tests of Controls

Audit Sampling for Tests of Controls and Substantive Tests of Transactions

Completing the Tests in the Sales and Collection Cycle: Accounts Receivable

Audit Sampling for Tests of Details of Balances

Audit of the Acquisition and Payment Cycle: Tests of Controls,

Completing the Tests in the Acquisition and Payment Cycle:

Audit of the Payroll and Personnel Cycle

Audit of the Inventory and Warehousing Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash and Financial Instruments

Completing the Audit

Other Assurance Services

Internal and Governmental Financial Auditing and Operational Auditing

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