Question 1

Sampling risk deals with which of the following?

Accepted Answer

A) Not carrying out the appropriate audit procedure. 
B) Drawing an incorrect inference from the sample results. 
C) Inappropriately diagnosing client's problems. 
D) Both A and C. 
A) Not carrying out the appropriate audit procedure. 
B) Drawing an incorrect inference from the sample results. 
C) Inappropriately diagnosing client's problems. 
D) Both A and C.

Question 2

The tolerable failure rate is the level at which the control's failure to operate would cause the auditor to conclude that the control is not effective and would likely change the auditor's planned assessment of control risk in performing tests of account balances..

Accepted Answer

A) True 
 B)False

Question 3

The population is a group of items in an account balance that the auditor wants to test.

Accepted Answer

A) True 
 B)False

Question 4

Extracting data from the client's computer system is one of the tasks that can be performed by GAS.

Accepted Answer

A) True 
 B)False

Question 5

When performing sampling,the auditor is most concerned with which of the following?

Accepted Answer

A) Risk of incorrect rejection. 
B) Risk of incorrect acceptance. 
C) Risk of excess sample size. 
D) Risk of errors in the population. 
A) Risk of incorrect rejection. 
B) Risk of incorrect acceptance. 
C) Risk of excess sample size. 
D) Risk of errors in the population.

Question 6

Sampling risk is defined as the risk that an inference drawn from a sample will be incorrect.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is the level at which the control's failure to operate would cause the auditor to conclude that the control is not effective and would likely change the auditor's planned assessment of control risk in performing tests of account balances?

Accepted Answer

A) Tolerable failure rate. 
B) Allowable risk of assessing control risk too low. 
C) Expected failure rate. 
D) Allowance for sampling error. 
A) Tolerable failure rate. 
B) Allowable risk of assessing control risk too low. 
C) Expected failure rate. 
D) Allowance for sampling error.

Question 8

Non-sampling risk deals with which of the following?

Accepted Answer

A) Not carrying out the appropriate audit procedure. 
B) Drawing an incorrect inference from the sample results. 
C) Inappropriately diagnosing client's problems. 
D) Both A and C. 
A) Not carrying out the appropriate audit procedure. 
B) Drawing an incorrect inference from the sample results. 
C) Inappropriately diagnosing client's problems. 
D) Both A and C.

Question 9

Upper Misstatement Limit When evaluating the MUS sample results,the auditor calculates the total estimated misstatement in the account balance based on the sampling process.Describe the four components that make up this total.

Accepted Answer

The total estimated misstatement is comp

Question 10

Evaluating misstatements when using sampling to test account balances Explain the term "misstatement" as it applies to sampling during substantive procedures and explain how the term may be interpreted differently by different auditors.

Accepted Answer

A misstatement is an error,either intent

Question 11

Which of the following is not a step the auditor needs to determine in designing sampling for substantive testing?

Accepted Answer

A) The audit objective. 
B) The method of selecting a sample. 
C) Expected misstatement conditions. 
D) Control failure risk. 
A) The audit objective. 
B) The method of selecting a sample. 
C) Expected misstatement conditions. 
D) Control failure risk.

Question 12

Sample size varies directly with sampling risk.

Accepted Answer

A) True 
 B)False

Question 13

In testing account balances,haphazard sampling is an acceptable method of sampling provided the auditor believes the sample to be which of the following?

Accepted Answer

A) Statistically sound. 
B) Representative of the population. 
C) Representative of the sample. 
D) In the upper stratum. 
A) Statistically sound. 
B) Representative of the population. 
C) Representative of the sample. 
D) In the upper stratum.

Question 14

When using MUS,an auditor found that the sampling interval should be $15,755.If selecting the sample manually,the auditor should round the sample interval to which of the following amounts?

Accepted Answer

A) $16,000. 
B) $15,000. 
C) $14,000. 
D) $10,000. 
A) $16,000. 
B) $15,000. 
C) $14,000. 
D) $10,000.

Question 15

The auditor's tolerable failure rate for attribute sampling is the point in which control failures support the planned assessment of audit risk.

Accepted Answer

The answer of The auditor's tolerable failure rate for attribute...

Question 16

In analyzing misstatements using sampling techniques,the auditor should analyze the misstatements in what manners?

Accepted Answer

A) Qualitatively and quantitatively. 
B) Absolutely and proportionately. 
C) Haphazardly and randomly. 
D) Methodically and systematically. 
A) Qualitatively and quantitatively. 
B) Absolutely and proportionately. 
C) Haphazardly and randomly. 
D) Methodically and systematically.

Question 17

Which one of the following is a proper course of action for the auditor when the total estimated misstatement exceeds the tolerable misstatement?

Accepted Answer

A) The auditor can ask the client to correct the known misstatements. 
B) The auditor will analyze the detected misstatements for some common problems. 
C) The auditor can expand the sample. 
D) All of the above. 
A) The auditor can ask the client to correct the known misstatements. 
B) The auditor will analyze the detected misstatements for some common problems. 
C) The auditor can expand the sample. 
D) All of the above.

Question 18

Tolerable misstatement is the maximum amount of misstatement the auditor can accept in the population without requiring an audit adjustment or a qualified audit opinion.

Accepted Answer

A) True 
 B)False

Question 19

Which one of the following is a decision the auditor makes when using attribute sampling?

Accepted Answer

A) The sampling unit. 
B) Period covered by testing. 
C) Completeness of the population. 
D) All of the above are auditor decisions. 
A) The sampling unit. 
B) Period covered by testing. 
C) Completeness of the population. 
D) All of the above are auditor decisions.

Question 20

Which of the following are limitations of using the MUS sampling method?

Accepted Answer

A) MUS is not very useful in testing for understatement. 
B) MUS is not very useful in testing for zero and negative amounts. 
C) N MUS is not very useful in testing if the auditor expects numerous misstatements. 
D) All of the above. 
A) MUS is not very useful in testing for understatement. 
B) MUS is not very useful in testing for zero and negative amounts. 
C) N MUS is not very useful in testing if the auditor expects numerous misstatements. 
D) All of the above.

Sampling risk deals with which of the following?

The tolerable failure rate is the level at which the control's failure to operate would cause the auditor to conclude that the control is not effective and would likely change the auditor's planned assessment of control risk in performing tests of account balances..

The population is a group of items in an account balance that the auditor wants to test.

Extracting data from the client's computer system is one of the tasks that can be performed by GAS.

When performing sampling,the auditor is most concerned with which of the following?

Sampling risk is defined as the risk that an inference drawn from a sample will be incorrect.

Which of the following is the level at which the control's failure to operate would cause the auditor to conclude that the control is not effective and would likely change the auditor's planned assessment of control risk in performing tests of account balances?

Non-sampling risk deals with which of the following?

Upper Misstatement Limit When evaluating the MUS sample results,the auditor calculates the total estimated misstatement in the account balance based on the sampling process.Describe the four components that make up this total.

Evaluating misstatements when using sampling to test account balances Explain the term "misstatement" as it applies to sampling during substantive procedures and explain how the term may be interpreted differently by different auditors.

Which of the following is not a step the auditor needs to determine in designing sampling for substantive testing?

Sample size varies directly with sampling risk.

In testing account balances,haphazard sampling is an acceptable method of sampling provided the auditor believes the sample to be which of the following?

When using MUS,an auditor found that the sampling interval should be $15,755.If selecting the sample manually,the auditor should round the sample interval to which of the following amounts?

The auditor's tolerable failure rate for attribute sampling is the point in which control failures support the planned assessment of audit risk.

In analyzing misstatements using sampling techniques,the auditor should analyze the misstatements in what manners?

Which one of the following is a proper course of action for the auditor when the total estimated misstatement exceeds the tolerable misstatement?

Tolerable misstatement is the maximum amount of misstatement the auditor can accept in the population without requiring an audit adjustment or a qualified audit opinion.

Which one of the following is a decision the auditor makes when using attribute sampling?

Which of the following are limitations of using the MUS sampling method?

Auditing: Integral to the Economy

The Risk of Fraud and Mechanisms to Address Fraud: Regulation,corporate Governance,and Audit Quality

Internal Control Over Financial Reporting: Managements Responsibilities and Importance to the External Auditors

Professional Liability and the Need for Quality Auditor Judgments and Ethical Decisions

Professional Auditing Standards and the Audit Opinion Formulation Process

A Framework for Audit Evidence

Planning the Audit: Identifying and Responding to the Risks of Material Misstatement

Auditing the Revenue Cycle

Auditing Cash and Marketable Securities

Auditing Inventory, goods and Services, and Accounts Payable: the Acquisition and Payment Cycle

Auditing Long-Lived Assets: Acquisition, use, impairment, and Disposal

Auditing Debt Obligations and Stockholders Equity Transactions

Activities Required in Completing a Quality Audit

Audit Reports on Financial Statements

Advanced Topics Concerning Complex Auditing Judgments

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Exam 8: Specialized Audit Tools: Sampling and Generalized Audit Software

Sampling risk deals with which of the following?

The tolerable failure rate is the level at which the control's failure to operate would cause the auditor to conclude that the control is not effective and would likely change the auditor's planned assessment of control risk in performing tests of account balances..

The population is a group of items in an account balance that the auditor wants to test.

Extracting data from the client's computer system is one of the tasks that can be performed by GAS.

When performing sampling,the auditor is most concerned with which of the following?

Sampling risk is defined as the risk that an inference drawn from a sample will be incorrect.

Which of the following is the level at which the control's failure to operate would cause the auditor to conclude that the control is not effective and would likely change the auditor's planned assessment of control risk in performing tests of account balances?

Non-sampling risk deals with which of the following?

Upper Misstatement Limit When evaluating the MUS sample results,the auditor calculates the total estimated misstatement in the account balance based on the sampling process.Describe the four components that make up this total.

Evaluating misstatements when using sampling to test account balances Explain the term "misstatement" as it applies to sampling during substantive procedures and explain how the term may be interpreted differently by different auditors.

Which of the following is not a step the auditor needs to determine in designing sampling for substantive testing?

Sample size varies directly with sampling risk.

In testing account balances,haphazard sampling is an acceptable method of sampling provided the auditor believes the sample to be which of the following?

When using MUS,an auditor found that the sampling interval should be $15,755.If selecting the sample manually,the auditor should round the sample interval to which of the following amounts?

The auditor's tolerable failure rate for attribute sampling is the point in which control failures support the planned assessment of audit risk.

In analyzing misstatements using sampling techniques,the auditor should analyze the misstatements in what manners?

Which one of the following is a proper course of action for the auditor when the total estimated misstatement exceeds the tolerable misstatement?

Tolerable misstatement is the maximum amount of misstatement the auditor can accept in the population without requiring an audit adjustment or a qualified audit opinion.

Which one of the following is a decision the auditor makes when using attribute sampling?

Which of the following are limitations of using the MUS sampling method?

Auditing: Integral to the Economy

The Risk of Fraud and Mechanisms to Address Fraud: Regulation,corporate Governance,and Audit Quality

Internal Control Over Financial Reporting: Managements Responsibilities and Importance to the External Auditors

Professional Liability and the Need for Quality Auditor Judgments and Ethical Decisions

Professional Auditing Standards and the Audit Opinion Formulation Process

A Framework for Audit Evidence

Planning the Audit: Identifying and Responding to the Risks of Material Misstatement

Auditing the Revenue Cycle

Auditing Cash and Marketable Securities

Auditing Inventory, goods and Services, and Accounts Payable: the Acquisition and Payment Cycle

Auditing Long-Lived Assets: Acquisition, use, impairment, and Disposal

Auditing Debt Obligations and Stockholders Equity Transactions

Activities Required in Completing a Quality Audit

Audit Reports on Financial Statements

Advanced Topics Concerning Complex Auditing Judgments

Other Services Provided by Audit Firms

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