Question 1

The Corporations Act independence requirements are expressed in terms of:

Accepted Answer

A)  circumstances that might impair an auditor's objectivity and impartial judgement. 
B)  threats to independence and safeguards that should be applied. 
C)  fundamental principles of professional ethics. 
D)  rules that apply only to specific situations. 
A)  circumstances that might impair an auditor's objectivity and impartial judgement. 
B)  threats to independence and safeguards that should be applied. 
C)  fundamental principles of professional ethics. 
D)  rules that apply only to specific situations.

Question 2

What rules prohibit an auditor from being an employee, officer or director of an audit client?

Accepted Answer

The Corporations Act (s. 324CH

Question 3

Which of the following is NOT a reason often given for acting unethically?

Accepted Answer

A)  All legal behaviour is ethical. 
B)  It was not known that the action was unethical. 
C)  It is a course of action undertaken by everyone else. 
D)  There is a reduced likelihood of being discovered. 
A)  All legal behaviour is ethical. 
B)  It was not known that the action was unethical. 
C)  It is a course of action undertaken by everyone else. 
D)  There is a reduced likelihood of being discovered.

Question 4

Which one of the following would represent an ethical dilemma for an auditor?

Accepted Answer

A)  Being treated with cancellation of the audit by a client for not agreeing with management's treatment of an accounting issue 
B)  Being approached to tender for the audit of a newly formed company 
C)  Being asked to complete the audit for a nonprofit organisation for no fee 
D)  Being asked to undertake a non- assurance service for an audit client 
A)  Being treated with cancellation of the audit by a client for not agreeing with management's treatment of an accounting issue 
B)  Being approached to tender for the audit of a newly formed company 
C)  Being asked to complete the audit for a nonprofit organisation for no fee 
D)  Being asked to undertake a non- assurance service for an audit client

Question 5

Circumstances when working papers may be given to a third party are:

Accepted Answer

A)  when requested by a successor auditor. 
B)  when permission is granted by the client. 
C)  when there is a legal requirement to do so. 
D)  both B and C 
A)  when requested by a successor auditor. 
B)  when permission is granted by the client. 
C)  when there is a legal requirement to do so. 
D)  both B and C

Question 6

Discuss the role and responsibility of the audit committee.

Accepted Answer

The audit committee is a subcommittee of

Question 7

Discuss the ways in which both the accounting profession and society itself encourages public accountants to conduct themselves in a professional manner, i.e. the factors that influence the ethical conduct of audit practitioners.

Accepted Answer

There are many factors that encourage pu

Question 8

The Code of Ethics for Professional Accountants states that a public accountant should maintain integrity and objectivity. The term 'objectivity' refers to the ability:

Accepted Answer

A)  to be unyielding in all matters dealing with auditing procedures. 
B)  to choose independently between alternative accounting treatments. 
C)  to distinguish independently between accounting practices that are acceptable and those which are not. 
D)  to maintain an impartial attitude on all matters that come under the accountant's review. 
A)  to be unyielding in all matters dealing with auditing procedures. 
B)  to choose independently between alternative accounting treatments. 
C)  to distinguish independently between accounting practices that are acceptable and those which are not. 
D)  to maintain an impartial attitude on all matters that come under the accountant's review.

Question 9

Which one of the following is NOT one of the five fundamental principles of professional conduct set out in the Code of Ethics for Professional Accountants?

Accepted Answer

A)  Continuing education 
B)  Confidentiality 
C)  Objectivity 
D)  Integrity 
A)  Continuing education 
B)  Confidentiality 
C)  Objectivity 
D)  Integrity

Question 10

Can a public accounting firm accept an audit client if a principal within the firm has a direct shareholding in the prospective client?

Accepted Answer

The Corporations Act (s. 324CH) and the

Question 11

When a firm undertakes both internal and external auditing services for the same entity, which of the following must be applied for the external auditor to demonstrate independence?

Accepted Answer

A)  The external auditor should gather sufficient appropriate audit and rely no more than usual on internal audit work. 
B)  The external auditor should not assume the role of management when undertaking internal audit services. 
C)  Any recommendations made by auditors are for implementation by management rather than the auditor. 
D)  All of the above 
A)  The external auditor should gather sufficient appropriate audit and rely no more than usual on internal audit work. 
B)  The external auditor should not assume the role of management when undertaking internal audit services. 
C)  Any recommendations made by auditors are for implementation by management rather than the auditor. 
D)  All of the above

Question 12

The Code of Ethics for Professional Accountants adopts a conceptual framework that involves:

Accepted Answer

A)  a system of safeguards that reduce threats to an acceptable level. 
B)  a framework for identifying, evaluating and resolving threats to the fundamental principles. 
C)  principles approach because it is impossible to anticipate every situation that might generate an ethical problem for a professional accountant. 
D)  all of the above 
A)  a system of safeguards that reduce threats to an acceptable level. 
B)  a framework for identifying, evaluating and resolving threats to the fundamental principles. 
C)  principles approach because it is impossible to anticipate every situation that might generate an ethical problem for a professional accountant. 
D)  all of the above

Question 13

Which statement about the Code of Ethics for Professional Accountants is NOT true?

Accepted Answer

A)  The Code of Ethics for Professional Accountants has the force of law applicable to auditing standards 
B)  The Code of Ethics for Professional Accountants includes specific rules defining unacceptable behaviours 
C)  The Code of Ethics for Professional Accountants outlines a six- step model for resolving ethical dilemmas 
D)  The Code of Ethics for Professional Accountants contains a section of quality control ideals 
A)  The Code of Ethics for Professional Accountants has the force of law applicable to auditing standards 
B)  The Code of Ethics for Professional Accountants includes specific rules defining unacceptable behaviours 
C)  The Code of Ethics for Professional Accountants outlines a six- step model for resolving ethical dilemmas 
D)  The Code of Ethics for Professional Accountants contains a section of quality control ideals

Question 14

The provision of internal audit services to an audit client may place at risk which of the following ethical attributes?

Accepted Answer

A)  Competence and due care 
B)  Confidentiality 
C)  Independence 
D)  All of the above 
A)  Competence and due care 
B)  Confidentiality 
C)  Independence 
D)  All of the above

Question 15

Which of the following is an example of audit failure?

Accepted Answer

A)  There is business failure. 
B)  The client company is insolvent. 
C)  The auditor failed to use due care and skill in the conduct of the audit. 
D)  All of the above 
A)  There is business failure. 
B)  The client company is insolvent. 
C)  The auditor failed to use due care and skill in the conduct of the audit. 
D)  All of the above

Question 16

The value of the audit report and the demand for audit services depends on:

Accepted Answer

A)  the fees paid for audits. 
B)  public confidence in the regulators. 
C)  public confidence in the independence and integrity of CPAs and chartered accountants. 
D)  all of the above 
A)  the fees paid for audits. 
B)  public confidence in the regulators. 
C)  public confidence in the independence and integrity of CPAs and chartered accountants. 
D)  all of the above

Question 17

The main reason for communication between the predecessor and successor auditor is to:

Accepted Answer

A)  determine any implications for the independence of the successor. 
B)  establish the likelihood that fees will be paid. 
C)  satisfy ASIC requirements. 
D)  pass on working papers. 
A)  determine any implications for the independence of the successor. 
B)  establish the likelihood that fees will be paid. 
C)  satisfy ASIC requirements. 
D)  pass on working papers.

Question 18

The audit expectation gap is attributed to which of the following causes?

Accepted Answer

A)  Auditors' self- interest in protecting their profits 
B)  Changes in social expectations 
C)  Complainants' self- interest seeking compensation 
D)  All of the above 
A)  Auditors' self- interest in protecting their profits 
B)  Changes in social expectations 
C)  Complainants' self- interest seeking compensation 
D)  All of the above

Question 19

A public accounting firm currently audits XYZ Co., a publicly listed company. The firm has been approached by XYZ Co. to also provide valuation services on all its Property, Plant and Equipment. Can the firm provide these services?

Accepted Answer

Subsection 290.176 of the Code indicates

Question 20

Independence in fact is where:

Accepted Answer

A)  the audit firm does not provide any non- assurance services to the audit client. 
B)  the general public considers that the auditor has acted objectively. 
C)  the audit firm has an effective quality control system in place in the conduct of an audit. 
D)  the auditor maintains an unbiased attitude during the audit. 
A)  the audit firm does not provide any non- assurance services to the audit client. 
B)  the general public considers that the auditor has acted objectively. 
C)  the audit firm has an effective quality control system in place in the conduct of an audit. 
D)  the auditor maintains an unbiased attitude during the audit.

The Corporations Act independence requirements are expressed in terms of:

What rules prohibit an auditor from being an employee, officer or director of an audit client?

Which of the following is NOT a reason often given for acting unethically?

Which one of the following would represent an ethical dilemma for an auditor?

Circumstances when working papers may be given to a third party are:

Discuss the role and responsibility of the audit committee.

Discuss the ways in which both the accounting profession and society itself encourages public accountants to conduct themselves in a professional manner, i.e. the factors that influence the ethical conduct of audit practitioners.

The Code of Ethics for Professional Accountants states that a public accountant should maintain integrity and objectivity. The term 'objectivity' refers to the ability:

Which one of the following is NOT one of the five fundamental principles of professional conduct set out in the Code of Ethics for Professional Accountants?

Can a public accounting firm accept an audit client if a principal within the firm has a direct shareholding in the prospective client?

When a firm undertakes both internal and external auditing services for the same entity, which of the following must be applied for the external auditor to demonstrate independence?

The Code of Ethics for Professional Accountants adopts a conceptual framework that involves:

Which statement about the Code of Ethics for Professional Accountants is NOT true?

The provision of internal audit services to an audit client may place at risk which of the following ethical attributes?

Which of the following is an example of audit failure?

The value of the audit report and the demand for audit services depends on:

The main reason for communication between the predecessor and successor auditor is to:

The audit expectation gap is attributed to which of the following causes?

A public accounting firm currently audits XYZ Co., a publicly listed company. The firm has been approached by XYZ Co. to also provide valuation services on all its Property, Plant and Equipment. Can the firm provide these services?

Independence in fact is where:

Demand for Audit and Assurance Services

Auditors Legal Environment

Audit Responsibilities and Objectives

Audit Evidence

Audit Planning and Documentation

Materiality and Risk

Internal Control and Control Risk

Fraud Auditing

The Impact of Information Technology on the Audit Process

Overall Audit Plan and Audit Program

Audit of the Sales and Collection Cycle: Tests of Controls and Substantive Tests of Transactions

Completing Tests in the Sales and Collection Cycle: Accounts Receivable

Audit Sampling

Audit of Transaction Cycles and Financial Statement Balances I

Audit of Transaction Cycles and Financial Statement Balances II

Completing the Audit

Audit Reporting

Other Auditing and Assurance Engagements

Filters

Exam 3: Audit Quality and Ethics

The Corporations Act independence requirements are expressed in terms of:

What rules prohibit an auditor from being an employee, officer or director of an audit client?

Which of the following is NOT a reason often given for acting unethically?

Which one of the following would represent an ethical dilemma for an auditor?

Circumstances when working papers may be given to a third party are:

Discuss the role and responsibility of the audit committee.

Discuss the ways in which both the accounting profession and society itself encourages public accountants to conduct themselves in a professional manner, i.e. the factors that influence the ethical conduct of audit practitioners.

The Code of Ethics for Professional Accountants states that a public accountant should maintain integrity and objectivity. The term 'objectivity' refers to the ability:

Which one of the following is NOT one of the five fundamental principles of professional conduct set out in the Code of Ethics for Professional Accountants?

Can a public accounting firm accept an audit client if a principal within the firm has a direct shareholding in the prospective client?

When a firm undertakes both internal and external auditing services for the same entity, which of the following must be applied for the external auditor to demonstrate independence?

The Code of Ethics for Professional Accountants adopts a conceptual framework that involves:

Which statement about the Code of Ethics for Professional Accountants is NOT true?

The provision of internal audit services to an audit client may place at risk which of the following ethical attributes?

Which of the following is an example of audit failure?

The value of the audit report and the demand for audit services depends on:

The main reason for communication between the predecessor and successor auditor is to:

The audit expectation gap is attributed to which of the following causes?

A public accounting firm currently audits XYZ Co., a publicly listed company. The firm has been approached by XYZ Co. to also provide valuation services on all its Property, Plant and Equipment. Can the firm provide these services?

Independence in fact is where:

Demand for Audit and Assurance Services

Auditors Legal Environment

Audit Responsibilities and Objectives

Audit Evidence

Audit Planning and Documentation

Materiality and Risk

Internal Control and Control Risk

Fraud Auditing

The Impact of Information Technology on the Audit Process

Overall Audit Plan and Audit Program

Audit of the Sales and Collection Cycle: Tests of Controls and Substantive Tests of Transactions

Completing Tests in the Sales and Collection Cycle: Accounts Receivable

Audit Sampling

Audit of Transaction Cycles and Financial Statement Balances I

Audit of Transaction Cycles and Financial Statement Balances II

Completing the Audit

Audit Reporting

Other Auditing and Assurance Engagements

Filters