Question 1

In regard to subsequent facts, the auditor _______.

Accepted Answer

A) has no responsibility 
B) is responsible for making reasonable efforts to detect any material subsequent facts 
C) is responsible for making reasonable efforts to detect any immaterial subsequent facts 
D) is only responsible for material events occurring before the balance sheet date 
A) has no responsibility 
B) is responsible for making reasonable efforts to detect any material subsequent facts 
C) is responsible for making reasonable efforts to detect any immaterial subsequent facts 
D) is only responsible for material events occurring before the balance sheet date

Question 2

An emphasis-of-matter paragraph in regards to revised financial statements should include _______.

Accepted Answer

A) the date of the auditor's previous report 
B) the type of opinion previously expressed 
C) the key reasons for a different opinion, if there are two different opinions 
D) all of these answer choices are correct 
A) the date of the auditor's previous report 
B) the type of opinion previously expressed 
C) the key reasons for a different opinion, if there are two different opinions 
D) all of these answer choices are correct

Question 3

If more than one component auditor was used to audit multiple subsidiaries, _______.

Accepted Answer

A) then the audit report should not be relied upon 
B) then the portion of the client audited by all component auditors can be aggregated together and expressed as one-dollar amount or percentage 
C) then the portion of the client audited by all prior auditors can be aggregated together and expressed as one-dollar amount or percentage 
D) control risk will increase accordingly 
A) then the audit report should not be relied upon 
B) then the portion of the client audited by all component auditors can be aggregated together and expressed as one-dollar amount or percentage 
C) then the portion of the client audited by all prior auditors can be aggregated together and expressed as one-dollar amount or percentage 
D) control risk will increase accordingly

Question 4

If a scope limitation is material, _______.

Accepted Answer

A) auditors cannot state a conclusion without evidence to support the conclusion 
B) auditors should state a conclusion even without evidence to support the conclusion 
C) it is of no relevance to the financial statements and their users 
D) the auditor should immediately withdraw from the engagement 
A) auditors cannot state a conclusion without evidence to support the conclusion 
B) auditors should state a conclusion even without evidence to support the conclusion 
C) it is of no relevance to the financial statements and their users 
D) the auditor should immediately withdraw from the engagement

Question 5

Whether auditors choose to dual date the audit report, or extend the end of fieldwork, _______.

Accepted Answer

A) their liability with respect to the financial statements remains the same 
B) they must request written representation from management as of the new date of the auditor's report 
C) they must request written representation from the internal auditors as of the new date of the auditor's report 
D) no further representations should be requested of management 
A) their liability with respect to the financial statements remains the same 
B) they must request written representation from management as of the new date of the auditor's report 
C) they must request written representation from the internal auditors as of the new date of the auditor's report 
D) no further representations should be requested of management

Question 6

If an auditor wishes to draw attention to important information that is already presented or disclosed in the financial statements, the auditor would include a _______.

Accepted Answer

A) qualified opinion 
B) disclaimer of opinion 
C) emphasis-of-matter paragraph 
D) scope limitation paragraph 
A) qualified opinion 
B) disclaimer of opinion 
C) emphasis-of-matter paragraph 
D) scope limitation paragraph

Question 7

For each of the following situations, indicate what type of audit report is most appropriate:
I.The auditor lacks independence in fact, but not necessarily in appearance.
II.There is a scope limitation and it is material, but the overall financial statements are still presented fairly.
III.The uncorrected misstatements are immaterial.
IV.There is a departure from Generally Accepted Accounting Principles (GAAP), and it is pervasively material.

Accepted Answer

I.Disclaimer
II.Qual

Question 8

During the compilation engagement for Cozy Couches Company, CPA Jim Bryce becomes aware that the accounting records and other information provided by management are incomplete and inaccurate.What should Jim Bryce do in this situation?

Accepted Answer

During a compilation engagement if the C

Question 9

Assume you completed your fieldwork on the XYZ Company audit of the December 31, 2025 financial statements on February 15, 2026.The financial statements were released on February 28, 2026.On March 16, 2026, you discovered that XYZ's largest customer filed for bankruptcy, which you believe could have caused you to change the audit report.How is your responsibility as an auditor, and the steps that should be taken, different than if you had been made aware of the subsequently discovered fact before February 28, 2026?

Accepted Answer

Auditors would follow the same initial s

Question 10

Define the emphasis of matter paragraph.

Accepted Answer

A) A paragraph included in the auditor's report that is required by generally accepted auditing standards or is included at the auditor's discretion. 
B) A paragraph that identifies the statements being audited and states the auditor's opinion. 
C) A paragraph that states responsibilities and references registration with the Public Company Accounting Oversight Board (PCAO
B) . 
D) A paragraph that briefly explains the process of conducting an audit and that the PCAOB standards were followed. 
A) A paragraph included in the auditor's report that is required by generally accepted auditing standards or is included at the auditor's discretion. 
B) A paragraph that identifies the statements being audited and states the auditor's opinion. 
C) A paragraph that states responsibilities and references registration with the Public Company Accounting Oversight Board (PCAO
B) . 
D) A paragraph that briefly explains the process of conducting an audit and that the PCAOB standards were followed.

Question 11

An integrated audit refers to _______.

Accepted Answer

A) integrating the opinion of the prior auditor into the current year audit 
B) allowing the firm's legal counsel to amend the audit report as they see fit 
C) performing the financial statement audit and the audit of the effectiveness of internal control over financial reporting (ICFR) at the same time 
D) only auditing the financial statements, with no procedures extended to the system of internal control 
A) integrating the opinion of the prior auditor into the current year audit 
B) allowing the firm's legal counsel to amend the audit report as they see fit 
C) performing the financial statement audit and the audit of the effectiveness of internal control over financial reporting (ICFR) at the same time 
D) only auditing the financial statements, with no procedures extended to the system of internal control

Question 12

It is the responsibility of the _______ to ensure that the work completed by a component auditor meets the auditing requirements and standards.

Accepted Answer

group enga

Question 13

When a material weakness is identified, the auditor should _______.

Accepted Answer

A) presume that a material misstatement exists in the financial statements 
B) not presume that a material misstatement occurred in the financial statements 
C) immediately request the internal audit function conduct a full review of the control issue 
D) proceed with issuing an unmodified opinion 
A) presume that a material misstatement exists in the financial statements 
B) not presume that a material misstatement occurred in the financial statements 
C) immediately request the internal audit function conduct a full review of the control issue 
D) proceed with issuing an unmodified opinion

Question 14

When an adverse opinion is issued regarding internal control over financial reporting (ICFR), the auditor _______.

Accepted Answer

A) maintains that the company has fairly reported its financial statements in accordance with Generally Accepted Accounting Principles (GAAP) 
B) makes a clear statement that the company has not maintained effective internal control for the period under audit 
C) makes a clear statement that the company has maintained effective internal control for the period under audit 
D) is not entitled to receive full compensation for services rendered during the audit 
A) maintains that the company has fairly reported its financial statements in accordance with Generally Accepted Accounting Principles (GAAP) 
B) makes a clear statement that the company has not maintained effective internal control for the period under audit 
C) makes a clear statement that the company has maintained effective internal control for the period under audit 
D) is not entitled to receive full compensation for services rendered during the audit

Question 15

Assume you completed your fieldwork on the XYZ Company audit of the December 31, 2025 financial statements on February 11, 2026.On February 13, 2026, you discovered that XYZ's largest customer filed for bankruptcy.XYZ has not yet released the financial statements.What is your responsibility as an auditor and what steps should be taken, if any?

Accepted Answer

Auditors are responsible for subsequentl

Question 16

Companies typically present their financial statements in comparative form, which means showing two consecutive years of balance sheets and three consecutive years of the income statement, statement of cash flows, and statement of stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 17

A/an _______ is an event that occurs between the date of the financial statements and the date of the auditor's report.

Accepted Answer

A) subsequent event 
B) dual event date 
C) auditor's report event 
D) financial event 
A) subsequent event 
B) dual event date 
C) auditor's report event 
D) financial event

Question 18

Whether auditors choose to dual date or extend the end of fieldwork, they must obtain a/an _______ from management.

Accepted Answer

A) written representation letter 
B) management representation letter 
C) auditing representation letter 
D) auditor's report date letter 
A) written representation letter 
B) management representation letter 
C) auditing representation letter 
D) auditor's report date letter

Question 19

Auditors of public companies can perform a/an _______, which means performing the financial statement audit and the audit of the effectiveness of internal control over financial reporting (ICFR) at the same time.

Accepted Answer

A) integrated audit 
B) internal audit 
C) compliance audit 
D) investigative audit 
A) integrated audit 
B) internal audit 
C) compliance audit 
D) investigative audit

Question 20

The following four situations require a modification to the standard unqualified audit report.Identify the modification required for each.
I.Opinion based in part on the report of another auditor
II.Going concern
III.Lack of consistency
IV.Subsequent event

Accepted Answer

I.This situation results in a modificati

In regard to subsequent facts, the auditor _______.

An emphasis-of-matter paragraph in regards to revised financial statements should include _______.

If more than one component auditor was used to audit multiple subsidiaries, _______.

If a scope limitation is material, _______.

Whether auditors choose to dual date the audit report, or extend the end of fieldwork, _______.

If an auditor wishes to draw attention to important information that is already presented or disclosed in the financial statements, the auditor would include a _______.

During the compilation engagement for Cozy Couches Company, CPA Jim Bryce becomes aware that the accounting records and other information provided by management are incomplete and inaccurate.What should Jim Bryce do in this situation?

Define the emphasis of matter paragraph.

An integrated audit refers to _______.

It is the responsibility of the _______ to ensure that the work completed by a component auditor meets the auditing requirements and standards.

When a material weakness is identified, the auditor should _______.

When an adverse opinion is issued regarding internal control over financial reporting (ICFR), the auditor _______.

Companies typically present their financial statements in comparative form, which means showing two consecutive years of balance sheets and three consecutive years of the income statement, statement of cash flows, and statement of stockholders' equity.

A/an _______ is an event that occurs between the date of the financial statements and the date of the auditor's report.

Whether auditors choose to dual date or extend the end of fieldwork, they must obtain a/an _______ from management.

Auditors of public companies can perform a/an _______, which means performing the financial statement audit and the audit of the effectiveness of internal control over financial reporting (ICFR) at the same time.

The following four situations require a modification to the standard unqualified audit report.Identify the modification required for each. I.Opinion based in part on the report of another auditor II.Going concern III.Lack of consistency IV.Subsequent event

Introduction and Overview of Audit and Assurance

Professionalism, Ethics and Legal Liability

Risk Assessment Part Iaudit Risk and Audit Strategy

Risk Assessment Part Iiunderstanding the Client

Audit Evidence

Understanding of the Clients System of Internal Controls

Data Analyticsoverview and Application

Risk Responseperforming Tests of Controls

Risk Responseperforming Substantive Procedures

Risk Responseaudit Sampling for Substantive Testing

Auditing the Revenue Cycle

Auditing the Purchases Cycle and Payroll Cycle

Auditing Cash, Inventory, Investing and Financing Activities

Completing the Audit

Filters

Exam 15: Reporting on the Audit

In regard to subsequent facts, the auditor _______.

An emphasis-of-matter paragraph in regards to revised financial statements should include _______.

If more than one component auditor was used to audit multiple subsidiaries, _______.

If a scope limitation is material, _______.

Whether auditors choose to dual date the audit report, or extend the end of fieldwork, _______.

If an auditor wishes to draw attention to important information that is already presented or disclosed in the financial statements, the auditor would include a _______.

During the compilation engagement for Cozy Couches Company, CPA Jim Bryce becomes aware that the accounting records and other information provided by management are incomplete and inaccurate.What should Jim Bryce do in this situation?

Define the emphasis of matter paragraph.

An integrated audit refers to _______.

It is the responsibility of the _______ to ensure that the work completed by a component auditor meets the auditing requirements and standards.

When a material weakness is identified, the auditor should _______.

When an adverse opinion is issued regarding internal control over financial reporting (ICFR), the auditor _______.

Companies typically present their financial statements in comparative form, which means showing two consecutive years of balance sheets and three consecutive years of the income statement, statement of cash flows, and statement of stockholders' equity.

A/an _______ is an event that occurs between the date of the financial statements and the date of the auditor's report.

Whether auditors choose to dual date or extend the end of fieldwork, they must obtain a/an _______ from management.

Auditors of public companies can perform a/an _______, which means performing the financial statement audit and the audit of the effectiveness of internal control over financial reporting (ICFR) at the same time.

The following four situations require a modification to the standard unqualified audit report.Identify the modification required for each. I.Opinion based in part on the report of another auditor II.Going concern III.Lack of consistency IV.Subsequent event

Introduction and Overview of Audit and Assurance

Professionalism, Ethics and Legal Liability

Risk Assessment Part Iaudit Risk and Audit Strategy

Risk Assessment Part Iiunderstanding the Client

Audit Evidence

Understanding of the Clients System of Internal Controls

Data Analyticsoverview and Application

Risk Responseperforming Tests of Controls

Risk Responseperforming Substantive Procedures

Risk Responseaudit Sampling for Substantive Testing

Auditing the Revenue Cycle

Auditing the Purchases Cycle and Payroll Cycle

Auditing Cash, Inventory, Investing and Financing Activities

Completing the Audit

Filters