Question 1

Which of the following is an essential factor in evaluating the sufficiency of evidence? The evidence must

Accepted Answer

A)  Be well documented and cross-referenced in the audit documents. 
B)  Be based on sources that are considered reliable. 
C)  Bear a direct relationship to the audit assertion. 
D)  Be persuasive enough to enable the auditor to form an opinion. 
A)  Be well documented and cross-referenced in the audit documents. 
B)  Be based on sources that are considered reliable. 
C)  Bear a direct relationship to the audit assertion. 
D)  Be persuasive enough to enable the auditor to form an opinion.

Question 2

Audit documents that record the procedures used by the auditor to gather evidence should be

Accepted Answer

A)  Considered the primary support for the financial statements being examined. 
B)  Viewed as the connecting link between the accounting records and the financial statements. 
C)  Designed in an orderly fashion to facilitate the review of audit work by the senior, manager, and partner on the engagement. 
D)  Retained until the audited entity ceases to be a client. 
A)  Considered the primary support for the financial statements being examined. 
B)  Viewed as the connecting link between the accounting records and the financial statements. 
C)  Designed in an orderly fashion to facilitate the review of audit work by the senior, manager, and partner on the engagement. 
D)  Retained until the audited entity ceases to be a client.

Question 3

Explain the occurrence and completeness assertions.How does failure to meet each assertion affect the financial statements?

Accepted Answer

The occurrence assertion relates to whet

Question 4

The current audit file usually includes

Accepted Answer

A)  Working trial balance. 
B)  Organizational chart. 
C)  Accounting manual. 
D)  Copies of important contracts. 
A)  Working trial balance. 
B)  Organizational chart. 
C)  Accounting manual. 
D)  Copies of important contracts.

Question 5

The audit working papers belong to

Accepted Answer

A)  The company under audit. 
B)  The government. 
C)  The audit firm. 
D)  They are public record documents. 
A)  The company under audit. 
B)  The government. 
C)  The audit firm. 
D)  They are public record documents.

Question 6

A not-for-profit organization published a monthly magazine that had 15,000 subscribers on January 1,2013.The number of subscribers increased steadily throughout the year and at December 31,2013,there were 16,200 subscribers.The annual magazine subscription cost was $10 on January 1,2013 and was increased to $12 for new members on April 1,2013.Subscriptions are paid in full at the beginning of the member term.An auditor should expect that the revenue from subscriptions for the year ended December 31,2013,would be approximately

Accepted Answer

A)  $179,400. 
B)  $171,600. 
C)  $164,400. 
D)  $163,800. 
A)  $179,400. 
B)  $171,600. 
C)  $164,400. 
D)  $163,800.

Question 7

Which of the following tends to be most predictable for purposes of analytical procedures applied as substantive procedures?

Accepted Answer

A)  Relationships involving balance sheet accounts. 
B)  Transactions subject to management discretion. 
C)  Relationships involving income statement accounts. 
D)  Data subject to audit testing in the prior year. 
A)  Relationships involving balance sheet accounts. 
B)  Transactions subject to management discretion. 
C)  Relationships involving income statement accounts. 
D)  Data subject to audit testing in the prior year.

Question 8

An example of an analytical procedure is the comparison of

Accepted Answer

A)  Financial information with similar information regarding the industry in which the entity operates. 
B)  Recorded amounts of major disbursements with appropriate invoices. 
C)  Results of a statistical sample with the expected characteristics of the actual population. 
D)  EDP generated data with similar data generated by a manual accounting system. 
A)  Financial information with similar information regarding the industry in which the entity operates. 
B)  Recorded amounts of major disbursements with appropriate invoices. 
C)  Results of a statistical sample with the expected characteristics of the actual population. 
D)  EDP generated data with similar data generated by a manual accounting system.

Question 9

Which set of assertions is tested when,during completion of the audit,the audit partner conducts a final review of the format of the entity's balance sheet?

Accepted Answer

A)  Assertions about classes of transactions and events. 
B)  Assertions about account balances at the period end. 
C)  Assertions about presentation and disclosure. 
D)  None of these. 
A)  Assertions about classes of transactions and events. 
B)  Assertions about account balances at the period end. 
C)  Assertions about presentation and disclosure. 
D)  None of these.

Question 10

Audit documentation

Accepted Answer

A)  Must be in electronic form. 
B)  Must be in paper form only. 
C)  Is not required, but is strongly recommended. 
D)  May be in paper, electronic, or some other form. 
A)  Must be in electronic form. 
B)  Must be in paper form only. 
C)  Is not required, but is strongly recommended. 
D)  May be in paper, electronic, or some other form.

Question 11

Audit procedures are designed to test management assertions.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following elements ultimately determines the amount of audit work that is necessary in the circumstances to afford a reasonable basis for an opinion?

Accepted Answer

A)  Auditor judgment. 
B)  Materiality. 
C)  Relative risk. 
D)  Reasonable assurance. 
A)  Auditor judgment. 
B)  Materiality. 
C)  Relative risk. 
D)  Reasonable assurance.

Question 13

In determining whether transactions have been recorded,the direction of the audit testing should start from the

Accepted Answer

A)  General ledger balances. 
B)  Adjusted trial balance. 
C)  Original source documents. 
D)  General journal entries. 
A)  General ledger balances. 
B)  Adjusted trial balance. 
C)  Original source documents. 
D)  General journal entries.

Question 14

The cutoff assertion relates to whether transactions and events have been recorded in the correct accounting period.

Accepted Answer

A) True 
 B)False

Question 15

When using analytical procedures,the auditor first needs to develop an expectation with which to compare recorded results.What is meant by "precision of the expectation," and what factors affect the precision of analytical procedures?

Accepted Answer

The quality of an expectation is referre

Which of the following is an essential factor in evaluating the sufficiency of evidence? The evidence must

Audit documents that record the procedures used by the auditor to gather evidence should be

Explain the occurrence and completeness assertions.How does failure to meet each assertion affect the financial statements?

The current audit file usually includes

The audit working papers belong to

Which of the following tends to be most predictable for purposes of analytical procedures applied as substantive procedures?

An example of an analytical procedure is the comparison of

Which set of assertions is tested when,during completion of the audit,the audit partner conducts a final review of the format of the entity's balance sheet?

Audit documentation

Audit procedures are designed to test management assertions.

Which of the following elements ultimately determines the amount of audit work that is necessary in the circumstances to afford a reasonable basis for an opinion?

In determining whether transactions have been recorded,the direction of the audit testing should start from the

The cutoff assertion relates to whether transactions and events have been recorded in the correct accounting period.

When using analytical procedures,the auditor first needs to develop an expectation with which to compare recorded results.What is meant by "precision of the expectation," and what factors affect the precision of analytical procedures?

An Introduction to Assurance and Financial Statement Auditing

The Financial Statement Auditing Environment

Audit Planning, Types of Audit Tests, and Materiality

Risk Assessment

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

Professsional Conduct,Independence,and Quality Control

Legal Liability

Assurance,Attestation,amd Internal Auditing Services-professional Judgement Module

Filters

Exam 5: Evidence and Documentation

Which of the following is an essential factor in evaluating the sufficiency of evidence? The evidence must

Audit documents that record the procedures used by the auditor to gather evidence should be

Explain the occurrence and completeness assertions.How does failure to meet each assertion affect the financial statements?

The current audit file usually includes

The audit working papers belong to

Which of the following tends to be most predictable for purposes of analytical procedures applied as substantive procedures?

An example of an analytical procedure is the comparison of

Which set of assertions is tested when,during completion of the audit,the audit partner conducts a final review of the format of the entity's balance sheet?

Audit documentation

Audit procedures are designed to test management assertions.

Which of the following elements ultimately determines the amount of audit work that is necessary in the circumstances to afford a reasonable basis for an opinion?

In determining whether transactions have been recorded,the direction of the audit testing should start from the

The cutoff assertion relates to whether transactions and events have been recorded in the correct accounting period.

When using analytical procedures,the auditor first needs to develop an expectation with which to compare recorded results.What is meant by "precision of the expectation," and what factors affect the precision of analytical procedures?

An Introduction to Assurance and Financial Statement Auditing

The Financial Statement Auditing Environment

Audit Planning, Types of Audit Tests, and Materiality

Risk Assessment

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

Professsional Conduct,Independence,and Quality Control

Legal Liability

Assurance,Attestation,amd Internal Auditing Services-professional Judgement Module

Filters