Exam 2: Professional Standards

Identify each of the following statements as being related to the responsibilities (RSP),performance (P),or reporting (RPT)principles. ______ 1.Evaluating audit firm personnel's independence with respect to a prospective client. ______ 2.Gathering sufficient,appropriate evidence. ______ 3.Exercising an appropriate level of professional skepticism. ______ 4.Issuing a qualified opinion because of a material,yet not pervasive,departure from GAAP. ______ 5.Establishing materiality levels for use in determining the amount of evidence to be gathered. ______ 6.Considering the susceptibility of the account balance to misstatement to assess the risk of material misstatement. ______ 7.Possessing the appropriate competence and capabilities to perform the audit. ______ 8.Considering whether a scope limitation precludes sufficient evidence to allow an opinion to be expressed on the entity's financial statements. ______ 9.Planning the work to provide reasonable assurance that the financial statements are free from material misstatement. ______ 10.Evaluating the potential relationships between the auditor and family who are employed by the entity.

Kramer,CPA consulted an independent appraiser regarding the valuation of fine art for a not-for-profit museum.Consultation with a specialist in this case would

Auditors of public entities registered with the Securities and Exchange Commission are required to register with the Public Company Accounting Oversight Board.

The opinion paragraph of the auditors' report includes a statement that

The contents of the auditors' report are guided by the performance principle of GAAS.

Which of the following elements of a system of quality control is related to firms receiving independence confirmations from its professionals with respect to clients?

To perform its monitoring function,the PCAOB conducts periodic _____________________________ of the quality of work performed by accounting firms that audit public entities.

Which of the following is not related to the performance principle of GAAS?

Auditors' understanding of the internal control in an entity contributes information for

Audits of historical financial statements are guided by a broad set of principles referred to as ___________________________________________________________.

Which of the following concepts is least related to the risk of material misstatement?

Which of the following is not included in the auditors' standard report representing an unqualified opinion?

An overall opinion that the financial statements present the financial condition,results of operations,and cash flows according to generally accepted accounting principles is a(n)_____________________________ opinion.

The evidence considered most appropriate by auditors is best described as

Which of the following is not considered a type of audit evidence?

An important role of the Public Company Accounting Oversight Board is to oversee the

Which of the following is most closely associated with the responsibilities principle?

Which of the following is most closely related to the relevance of audit evidence?

An unqualified opinion indicates that the financial statements present the entity's financial condition,results of operations,and cash flows in conformity with GAAP.

An audit of the financial statements of Camden Corporation is being conducted by external auditors.The external auditors are expected to: