Question 1

Why are the auditing standards referred to as the 'force of law' standards?

Accepted Answer

On 1 July 2004, the Corporate Law Econom

Question 2

The International Standards on Auditing (ISAs) are issued by:

Accepted Answer

A)  United States Securities and Exchange Commission. 
B)  International Federation of Accountants. 
C)  International Institute of Internal Auditors. 
D)  International Quality Control Association. 
A)  United States Securities and Exchange Commission. 
B)  International Federation of Accountants. 
C)  International Institute of Internal Auditors. 
D)  International Quality Control Association.

Question 3

Which of the following services provides no assurances about the client's financial statements?

Accepted Answer

A)  Audit 
B)  Compliance 
C)  Review 
D)  None of the above; all provide some level of assurance. 
A)  Audit 
B)  Compliance 
C)  Review 
D)  None of the above; all provide some level of assurance.

Question 4

Which of the following is NOT a category of Auditing Standards?

Accepted Answer

A)  Audit conclusions and reporting 
B)  General principles and responsibilities 
C)  Risk assessment and response to assessed risks 
D)  Ethical requirements 
A)  Audit conclusions and reporting 
B)  General principles and responsibilities 
C)  Risk assessment and response to assessed risks 
D)  Ethical requirements

Question 5

An auditor could determine how many items need to be selected from the population for a particular audit test by consulting:

Accepted Answer

A)  ASA 530. 
B)  ASA 500. 
C)  ASA 300. 
D)  none of the above 
A)  ASA 530. 
B)  ASA 500. 
C)  ASA 300. 
D)  none of the above

Question 6

The main purpose of the Corporations Act is to:

Accepted Answer

A)  develop and promulgate approved accounting standards. 
B)  ensure that auditors conducting financial statement audits are registered. 
C)  give legislative backing to the Australian Securities Exchange's Listing Rules. 
D)  establish appropriate corporate governance mechanisms to promote appropriate decision making by participants and managerial accountability to shareholders. 
A)  develop and promulgate approved accounting standards. 
B)  ensure that auditors conducting financial statement audits are registered. 
C)  give legislative backing to the Australian Securities Exchange's Listing Rules. 
D)  establish appropriate corporate governance mechanisms to promote appropriate decision making by participants and managerial accountability to shareholders.

Question 7

A performance audit:

Accepted Answer

A)  determines whether specific provisions are being complied with. 
B)  reviews operating procedures and methods. 
C)  evaluates the client's business strategies and processes. 
D)  determines whether financial statements are in accordance with accounting standards. 
A)  determines whether specific provisions are being complied with. 
B)  reviews operating procedures and methods. 
C)  evaluates the client's business strategies and processes. 
D)  determines whether financial statements are in accordance with accounting standards.

Question 8

To operate effectively, internal auditors:

Accepted Answer

A)  report on the financial statements of the organisation. 
B)  are independent of the line functions in an organisation. 
C)  are independent of the organisation. 
D)  none of the above 
A)  report on the financial statements of the organisation. 
B)  are independent of the line functions in an organisation. 
C)  are independent of the organisation. 
D)  none of the above

Question 9

To operate effectively, internal auditors must be:

Accepted Answer

A)  contracted by the organisation subject to audit. 
B)  independent of the line functions within an organisation. 
C)  members of either the Institute of Chartered Accountants in Australia or CPA Australia. 
D)  registered with ASIC and meet minimum professional development requirements. 
A)  contracted by the organisation subject to audit. 
B)  independent of the line functions within an organisation. 
C)  members of either the Institute of Chartered Accountants in Australia or CPA Australia. 
D)  registered with ASIC and meet minimum professional development requirements.

Question 10

Discuss the similarities and differences between financial statement audits, performance (operational) audits and compliance audits. Give an example of each type.

Accepted Answer

Financial statement audits, performance

Question 11

A compilation report:

Accepted Answer

A)  provides no assurance to third parties. 
B)  communicates an auditor's findings to a special user group that commissioned the audit. 
C)  is prepared during a taxation audit. 
D)  is a review of an audit providing a low level of assurance. 
A)  provides no assurance to third parties. 
B)  communicates an auditor's findings to a special user group that commissioned the audit. 
C)  is prepared during a taxation audit. 
D)  is a review of an audit providing a low level of assurance.

Question 12

A strategic system audit approach assists the auditor to:

Accepted Answer

A)  determine which areas of the audit to focus on. 
B)  evaluate audit evidence. 
C)  identify risks associated with the financial statements. 
D)  all of the above 
A)  determine which areas of the audit to focus on. 
B)  evaluate audit evidence. 
C)  identify risks associated with the financial statements. 
D)  all of the above

Question 13

Business performance measurement services involve:

Accepted Answer

A)  assurance about whether nonfinancial information being reported from the entity's performance measurement system is reliable. 
B)  using a balanced scorecard, the board of directors and managers define an entity's financial objectives and goals. 
C)  assurance about whether financial and nonfinancial information being reported from the entity's performance measurement system is reliable. 
D)  none of the above 
A)  assurance about whether nonfinancial information being reported from the entity's performance measurement system is reliable. 
B)  using a balanced scorecard, the board of directors and managers define an entity's financial objectives and goals. 
C)  assurance about whether financial and nonfinancial information being reported from the entity's performance measurement system is reliable. 
D)  none of the above

Question 14

Which one of the following statements is NOT true about audit reports?

Accepted Answer

A)  They are prepared as the final stage of the audit process. 
B)  They all follow the same form. 
C)  They differ in nature. 
D)  They communicate the auditor's findings to users. 
A)  They are prepared as the final stage of the audit process. 
B)  They all follow the same form. 
C)  They differ in nature. 
D)  They communicate the auditor's findings to users.

Why are the auditing standards referred to as the 'force of law' standards?

The International Standards on Auditing (ISAs) are issued by:

Which of the following services provides no assurances about the client's financial statements?

Which of the following is NOT a category of Auditing Standards?

An auditor could determine how many items need to be selected from the population for a particular audit test by consulting:

The main purpose of the Corporations Act is to:

A performance audit:

To operate effectively, internal auditors:

To operate effectively, internal auditors must be:

Discuss the similarities and differences between financial statement audits, performance (operational) audits and compliance audits. Give an example of each type.

A compilation report:

A strategic system audit approach assists the auditor to:

Business performance measurement services involve:

Which one of the following statements is NOT true about audit reports?

Auditors Legal Environment

Audit Quality and Ethics

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 1: Demand for Audit and Assurance Services

Why are the auditing standards referred to as the 'force of law' standards?

The International Standards on Auditing (ISAs) are issued by:

Which of the following services provides no assurances about the client's financial statements?

Which of the following is NOT a category of Auditing Standards?

An auditor could determine how many items need to be selected from the population for a particular audit test by consulting:

The main purpose of the Corporations Act is to:

A performance audit:

To operate effectively, internal auditors:

To operate effectively, internal auditors must be:

Discuss the similarities and differences between financial statement audits, performance (operational) audits and compliance audits. Give an example of each type.

A compilation report:

A strategic system audit approach assists the auditor to:

Business performance measurement services involve:

Which one of the following statements is NOT true about audit reports?

Auditors Legal Environment

Audit Quality and Ethics

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