Question 1

Before performing a compilation of the financial statements of a nonpublic entity, an accountant should:

Accepted Answer

A) perform a thorough study and evaluation of the internal control system. 
B) complete a series of inquiries concerning the entity's procedures for recording, classifying, and summarizing transactions. 
C) design working papers intended to provide sufficient competent evidential matter to afford a reasonable basis for a compilation opinion. 
D) obtain an understanding of the accounting principles and practices of the industry in which the entity operates. 
A) perform a thorough study and evaluation of the internal control system. 
B) complete a series of inquiries concerning the entity's procedures for recording, classifying, and summarizing transactions. 
C) design working papers intended to provide sufficient competent evidential matter to afford a reasonable basis for a compilation opinion. 
D) obtain an understanding of the accounting principles and practices of the industry in which the entity operates.

Question 2

The International Professional Practices Framework developed by the IIA includes all of the following types of guidance, except:

Accepted Answer

A) International Standards for the Professional Practice of Internal Auditing. 
B) Interpretations of Standards. 
C) Code of Ethics. 
D) Implementation Guidance. 
A) International Standards for the Professional Practice of Internal Auditing. 
B) Interpretations of Standards. 
C) Code of Ethics. 
D) Implementation Guidance.

Question 3

How has the advancement in technology led to the creation of the Trust Services?

Accepted Answer

The advancement in technology has increa

Question 4

Which of the following procedures is usually included in a review engagement of a nonpublic entity?

Accepted Answer

A) The confirmation of accounts receivable. 
B) A study and evaluation of internal control. 
C) An inquiry concerning subsequent events. 
D) The observation of physical inventory counts. 
A) The confirmation of accounts receivable. 
B) A study and evaluation of internal control. 
C) An inquiry concerning subsequent events. 
D) The observation of physical inventory counts.

Question 5

Prospective financial statements may be prepared for:

Accepted Answer

A) only general use. 
B) only limited use. 
C) only internal use. 
D) general, limited, and internal use. 
A) only general use. 
B) only limited use. 
C) only internal use. 
D) general, limited, and internal use.

Question 6

An examination of a financial forecast is a professional service that involves:

Accepted Answer

A) compiling or assembling a financial forecast that is based on management's assumptions. 
B) limiting the distribution of the accountant's report to management and the board of directors. 
C) assuming responsibility to update management on key events for one year after the report's date. 
D) evaluating whether the computations of prospective amounts are mathematically accurate and assumptions are internally consistent. 
A) compiling or assembling a financial forecast that is based on management's assumptions. 
B) limiting the distribution of the accountant's report to management and the board of directors. 
C) assuming responsibility to update management on key events for one year after the report's date. 
D) evaluating whether the computations of prospective amounts are mathematically accurate and assumptions are internally consistent.

Question 7

Match the Trust Services Principle with its proper definition.
-Confidentiality

Accepted Answer

A) Personal information is collected, used, retained, and disclosed and disposed to meet the entity's objectives. 
B) Information and systems are protected against unauthorized access, unauthorized disclosure of information, and damage to systems that could compromise the availability, integrity, confidentiality, and privacy of information or systems and affect the entity's ability to meet its objectives. 
C) System processing is complete, valid, accurate, timely, and authorized to meet the entity's objectives. 
D) Information designated as private is protected to meet the entity's objectives. 
E) Information and systems are available for operation and use to meet the entity's objectives. 
A) Personal information is collected, used, retained, and disclosed and disposed to meet the entity's objectives. 
B) Information and systems are protected against unauthorized access, unauthorized disclosure of information, and damage to systems that could compromise the availability, integrity, confidentiality, and privacy of information or systems and affect the entity's ability to meet its objectives. 
C) System processing is complete, valid, accurate, timely, and authorized to meet the entity's objectives. 
D) Information designated as private is protected to meet the entity's objectives. 
E) Information and systems are available for operation and use to meet the entity's objectives.

Question 8

Which of the following procedures is not usually performed by the accountant during a review engagement of a nonpublic entity?

Accepted Answer

A) Inquiry about actions taken at meetings of the board of directors that may affect the financial statements. 
B) Issuance of a report stating that the review was performed in accordance with standards established by the AICPA. 
C) Reading of the financial statements to determine if they conform with generally accepted accounting principles. 
D) Communication of any material weaknesses discovered during the consideration of internal control. 
A) Inquiry about actions taken at meetings of the board of directors that may affect the financial statements. 
B) Issuance of a report stating that the review was performed in accordance with standards established by the AICPA. 
C) Reading of the financial statements to determine if they conform with generally accepted accounting principles. 
D) Communication of any material weaknesses discovered during the consideration of internal control.

Question 9

An agreed-upon procedures engagement is significantly more limited in scope than an examination. An accountant may perform an agreed-upon procedures attestation engagement for prospective financial statements provided that attestation standards are complied with and eleven criteria are met. Identify five of the eleven criteria below.

Accepted Answer

Answer should include 5 of the following

Question 10

An accountant is required to comply with the provisions of Statements on Standards for Accounting and Review Services when: I. Typing client-prepared financial statements, without modification, as an accommodation to a client.
II) Preparing standard monthly journal entries for depreciation and expiration of prepaid expenses.

Accepted Answer

A) I only. 
B) II only. 
C) Both I and II. 
D) Neither I nor II. 
A) I only. 
B) II only. 
C) Both I and II. 
D) Neither I nor II.

Question 11

Match the Trust Services Principle with its proper definition.
-Availability

Accepted Answer

A) Personal information is collected, used, retained, and disclosed and disposed to meet the entity's objectives. 
B) Information and systems are protected against unauthorized access, unauthorized disclosure of information, and damage to systems that could compromise the availability, integrity, confidentiality, and privacy of information or systems and affect the entity's ability to meet its objectives. 
C) System processing is complete, valid, accurate, timely, and authorized to meet the entity's objectives. 
D) Information designated as private is protected to meet the entity's objectives. 
E) Information and systems are available for operation and use to meet the entity's objectives. 
A) Personal information is collected, used, retained, and disclosed and disposed to meet the entity's objectives. 
B) Information and systems are protected against unauthorized access, unauthorized disclosure of information, and damage to systems that could compromise the availability, integrity, confidentiality, and privacy of information or systems and affect the entity's ability to meet its objectives. 
C) System processing is complete, valid, accurate, timely, and authorized to meet the entity's objectives. 
D) Information designated as private is protected to meet the entity's objectives. 
E) Information and systems are available for operation and use to meet the entity's objectives.

Question 12

During a review of the financial statements of a nonpublic entity, the CPA finds that the financial statements contain a material departure from generally accepted accounting principles. If management refuses to correct the problem, the CPA should:

Accepted Answer

A) disclose the departure in a separate paragraph of the report. 
B) issue an adverse opinion. 
C) attach a footnote explaining the effects of the departure. 
D) issue a compilation report. 
A) disclose the departure in a separate paragraph of the report. 
B) issue an adverse opinion. 
C) attach a footnote explaining the effects of the departure. 
D) issue a compilation report.

Question 13

Trust Service criteria cover:

Accepted Answer

A) hardware design. 
B) confidentiality. 
C) software design. 
D) physical protection of computer systems. 
A) hardware design. 
B) confidentiality. 
C) software design. 
D) physical protection of computer systems.

Question 14

Limited assurance is provided in a review engagement.

Accepted Answer

A) True 
 B)False

Question 15

The practitioner's objective in an engagement to audit an entity's internal control is to assess management's assessment of the effectiveness of internal controls.

Accepted Answer

A) True 
 B)False

Question 16

Responding to a question such as "What would happen if..." is an attribute of which of the following types of engagements?

Accepted Answer

A) Financial projection. 
B) Financial forecast. 
C) Financial forecast and financial projection. 
D) Review. 
A) Financial projection. 
B) Financial forecast. 
C) Financial forecast and financial projection. 
D) Review.

Before performing a compilation of the financial statements of a nonpublic entity, an accountant should:

The International Professional Practices Framework developed by the IIA includes all of the following types of guidance, except:

How has the advancement in technology led to the creation of the Trust Services?

Which of the following procedures is usually included in a review engagement of a nonpublic entity?

Prospective financial statements may be prepared for:

An examination of a financial forecast is a professional service that involves:

Match the Trust Services Principle with its proper definition. -Confidentiality

Which of the following procedures is not usually performed by the accountant during a review engagement of a nonpublic entity?

Match the Trust Services Principle with its proper definition. -Availability

During a review of the financial statements of a nonpublic entity, the CPA finds that the financial statements contain a material departure from generally accepted accounting principles. If management refuses to correct the problem, the CPA should:

Trust Service criteria cover:

Limited assurance is provided in a review engagement.

The practitioner's objective in an engagement to audit an entity's internal control is to assess management's assessment of the effectiveness of internal controls.

Responding to a question such as "What would happen if..." is an attribute of which of the following types of engagements?

An Introduction to Assurance and Financial Statement Auditing

The Financial Statement Auditing Environment

Audit Planning, Types of Audit Tests, and Materiality

Risk Assessment

Evidence and Documentation

Internal Control in a Financial Statement Audit

Auditing Internal Control Over Financial Reporting

Audit Sampling: An Overview and Application to Tests of Controls

Audit Sampling: An Application to Substantive Tests of Account Balances

Auditing the Revenue Process

Auditing the Purchasing Process

Auditing the Human Resource Management Process

Auditing the Inventory Management Process

Auditing the Financinginvesting Process: Prepaid Expenses, Intangible Assets, and Property, Plant, and Equipment

Auditing the Financinginvesting Process: Long-Term Liabilities, Stockholders' Equity, and Income Statement Accounts

Auditing the Financinginvesting Process: Cash and Investments

Completing the Audit Engagement

Reports on Audited Financial Statements

Professional Conduct, Independence, and Quality Control

Legal Liability

Filters

Exam 21: Assurance, Attestation, and Internal Auditing Services

Before performing a compilation of the financial statements of a nonpublic entity, an accountant should:

The International Professional Practices Framework developed by the IIA includes all of the following types of guidance, except:

How has the advancement in technology led to the creation of the Trust Services?

Which of the following procedures is usually included in a review engagement of a nonpublic entity?

Prospective financial statements may be prepared for:

An examination of a financial forecast is a professional service that involves:

Match the Trust Services Principle with its proper definition. -Confidentiality

Which of the following procedures is not usually performed by the accountant during a review engagement of a nonpublic entity?

Match the Trust Services Principle with its proper definition. -Availability

During a review of the financial statements of a nonpublic entity, the CPA finds that the financial statements contain a material departure from generally accepted accounting principles. If management refuses to correct the problem, the CPA should:

Trust Service criteria cover:

Limited assurance is provided in a review engagement.

The practitioner's objective in an engagement to audit an entity's internal control is to assess management's assessment of the effectiveness of internal controls.

Responding to a question such as "What would happen if..." is an attribute of which of the following types of engagements?

An Introduction to Assurance and Financial Statement Auditing

The Financial Statement Auditing Environment

Audit Planning, Types of Audit Tests, and Materiality

Risk Assessment

Evidence and Documentation

Internal Control in a Financial Statement Audit

Auditing Internal Control Over Financial Reporting

Audit Sampling: An Overview and Application to Tests of Controls

Audit Sampling: An Application to Substantive Tests of Account Balances

Auditing the Revenue Process

Auditing the Purchasing Process

Auditing the Human Resource Management Process

Auditing the Inventory Management Process

Auditing the Financinginvesting Process: Prepaid Expenses, Intangible Assets, and Property, Plant, and Equipment

Auditing the Financinginvesting Process: Long-Term Liabilities, Stockholders' Equity, and Income Statement Accounts

Auditing the Financinginvesting Process: Cash and Investments

Completing the Audit Engagement

Reports on Audited Financial Statements

Professional Conduct, Independence, and Quality Control

Legal Liability

Filters