Question 1

When the auditor is not independent, a GAAP departure qualification is required.

Accepted Answer

A) True 
 B)False

Question 2

Under which of the following circumstances does an accountant become associated with a financial report?

Accepted Answer

A)  The accountant works for the enterprise that issues the report. 
B)  The accountant sits on the board of directors of the enterprise that issues the report. 
C)  The enterprise indicates that the accountant audited or reviewed the information included in the report. 
D)  The report does not mention that the accountant prepared or performed other services with respect to the information. 
A)  The accountant works for the enterprise that issues the report. 
B)  The accountant sits on the board of directors of the enterprise that issues the report. 
C)  The enterprise indicates that the accountant audited or reviewed the information included in the report. 
D)  The report does not mention that the accountant prepared or performed other services with respect to the information.

Question 3

If financial statements contain a very material departure from GAAP such that the financial statements are virtually useless, the auditor can render a(an) ________.

Accepted Answer

A)  qualified "except for" opinion with reference to the departure 
B)  adverse opinion with scope limitation reference 
C)  adverse opinion with reference to the departure 
D)  disclaimer of opinion 
A)  qualified "except for" opinion with reference to the departure 
B)  adverse opinion with scope limitation reference 
C)  adverse opinion with reference to the departure 
D)  disclaimer of opinion

Question 4

Auditors cannot give negative assurance in an audit report.

Accepted Answer

A) True 
 B)False

Question 5

The words "except for" should be used in the scope paragraph only if there is a reservation resulting in a disclaimer of opinion or a scope qualification.

Accepted Answer

A) True 
 B)False

Question 6

In Canada, when there has been a change in accounting principles and the effect of the change has been properly disclosed, the auditor should ________.

Accepted Answer

A)  refer to the change in an explanatory paragraph 
B)  explicitly concur that the change is preferred 
C)  issue an unqualified opinion 
D)  refer to the change in the opinion paragraph 
A)  refer to the change in an explanatory paragraph 
B)  explicitly concur that the change is preferred 
C)  issue an unqualified opinion 
D)  refer to the change in the opinion paragraph

Question 7

Management has decided that the life of a piece of heavy equipment should be decreased from 15 years to 10 years, thus increasing the annual amortization. The auditor agrees that this amortization period is more reflective of the nature of the asset. The type of audit report that should be issued is ________.

Accepted Answer

A)  unqualified 
B)  qualified 
C)  adverse 
D)  disclaimer 
A)  unqualified 
B)  qualified 
C)  adverse 
D)  disclaimer

Question 8

Without the public accountant's knowledge or consent, the enterprise indicates that the public accountant (PA) was involved with information issued by the enterprise. Which of the following statements is true?

Accepted Answer

A)  The PA has no responsibilities with respect to the information. 
B)  The PA should issue an opinion on the information. 
C)  The PA is not associated with the information. 
D)  The PA is associated with the information. 
A)  The PA has no responsibilities with respect to the information. 
B)  The PA should issue an opinion on the information. 
C)  The PA is not associated with the information. 
D)  The PA is associated with the information.

Question 9

Many users interpret audit reports based on the number of paragraphs. In a standard audit report on financial statements, how many paragraphs are there?

Accepted Answer

A)  Three paragraphs. 
B)  Four paragraphs. 
C)  Five paragraphs. 
D)  Six paragraphs. 
A)  Three paragraphs. 
B)  Four paragraphs. 
C)  Five paragraphs. 
D)  Six paragraphs.

When the auditor is not independent, a GAAP departure qualification is required.

Under which of the following circumstances does an accountant become associated with a financial report?

If financial statements contain a very material departure from GAAP such that the financial statements are virtually useless, the auditor can render a(an) ________.

Auditors cannot give negative assurance in an audit report.

The words "except for" should be used in the scope paragraph only if there is a reservation resulting in a disclaimer of opinion or a scope qualification.

In Canada, when there has been a change in accounting principles and the effect of the change has been properly disclosed, the auditor should ________.

Without the public accountant's knowledge or consent, the enterprise indicates that the public accountant (PA) was involved with information issued by the enterprise. Which of the following statements is true?

Many users interpret audit reports based on the number of paragraphs. In a standard audit report on financial statements, how many paragraphs are there?

Introduction to Auditing

Auditors Professional Roles and Responsibilities

Auditors Ethical and Legal Responsibilities

Preliminary Audit Planning: Understanding the Auditees Business

Assessing Risks in an Audit Engagement

Internal Control Over Financial Reporting

Audit Evidence and Assurance

Control Assessment and Testing

Audit Sampling

The Revenues, Receivables, and Receipts Process and Cash Account Balance

The Purchases, Payables, and Payments Process

Payroll and Production Processes

The Finance and Investment Process

Completing the Audit Work

Applying Professional Judgment to Form the Audit Opinion and Issue Theaudit Report

Other Public Accounting Services and Reportsreviews and Compilations

Professional Rules of Conduct Details and Auditor Responsibilities

Part I the Audit of Accounting Estimates: Basic Material Relating to Accountingestimates

Legal Liability Cases

Other Professional Accounting Services and Reports, Including Fraud

Filters

Exam 4: Reports on Audited Financial Statements

When the auditor is not independent, a GAAP departure qualification is required.

Under which of the following circumstances does an accountant become associated with a financial report?

If financial statements contain a very material departure from GAAP such that the financial statements are virtually useless, the auditor can render a(an) ________.

Auditors cannot give negative assurance in an audit report.

The words "except for" should be used in the scope paragraph only if there is a reservation resulting in a disclaimer of opinion or a scope qualification.

In Canada, when there has been a change in accounting principles and the effect of the change has been properly disclosed, the auditor should ________.

Without the public accountant's knowledge or consent, the enterprise indicates that the public accountant (PA) was involved with information issued by the enterprise. Which of the following statements is true?

Many users interpret audit reports based on the number of paragraphs. In a standard audit report on financial statements, how many paragraphs are there?

Introduction to Auditing

Auditors Professional Roles and Responsibilities

Auditors Ethical and Legal Responsibilities

Preliminary Audit Planning: Understanding the Auditees Business

Assessing Risks in an Audit Engagement

Internal Control Over Financial Reporting

Audit Evidence and Assurance

Control Assessment and Testing

Audit Sampling

The Revenues, Receivables, and Receipts Process and Cash Account Balance

The Purchases, Payables, and Payments Process

Payroll and Production Processes

The Finance and Investment Process

Completing the Audit Work

Applying Professional Judgment to Form the Audit Opinion and Issue Theaudit Report

Other Public Accounting Services and Reportsreviews and Compilations

Professional Rules of Conduct Details and Auditor Responsibilities

Part I the Audit of Accounting Estimates: Basic Material Relating to Accountingestimates

Legal Liability Cases

Other Professional Accounting Services and Reports, Including Fraud

Filters