Question 1

An agreement that commits the firm to a set of fixed conditions in the future regardless of what happens to profits or the economy as a whole is a definition of a

Accepted Answer

A) contingent liability. 
B) potentially hazardous agreement. 
C) commitment. 
D) conditional contract. 
A) contingent liability. 
B) potentially hazardous agreement. 
C) commitment. 
D) conditional contract.

Question 2

There are two categories of lawsuits: outstanding (or asserted)claims,and

Accepted Answer

A) possible or unasserted claims. 
B) disputed claims among several parties. 
C) settled claims. 
D) claims that could result in material misstatements. 
A) possible or unasserted claims. 
B) disputed claims among several parties. 
C) settled claims. 
D) claims that could result in material misstatements.

Question 3

Subsequent events affecting the valuation of assets ordinarily will require adjustments of the financial statements under examination because such events typically represent the

Accepted Answer

A) culmination of conditions that existed at the balance sheet date. 
B) final estimates of losses relating to casualties occurring in the subsequent events period. 
C) discovery of new conditions occurring in the subsequent events period. 
D) preliminary estimate of losses relating to new events that occurred subsequent to the balance sheet date. 
A) culmination of conditions that existed at the balance sheet date. 
B) final estimates of losses relating to casualties occurring in the subsequent events period. 
C) discovery of new conditions occurring in the subsequent events period. 
D) preliminary estimate of losses relating to new events that occurred subsequent to the balance sheet date.

Question 4

List the audit procedures the auditor conducts for subsequent events.

Accepted Answer

1)Inquiry of Management -Inquiries vary

Question 5

The auditor's responsibility for "reviewing the subsequent events" of a client is normally limited to the period of time beginning with the

Accepted Answer

A) balance sheet date and ending with the date of the auditor's report. 
B) start of the fiscal year under audit and ending with the balance sheet date. 
C) start of the fiscal year under audit and ending with the date of the auditor's report 
D) balance sheet date and ending with the date the registration statement becomes effective. 
A) balance sheet date and ending with the date of the auditor's report. 
B) start of the fiscal year under audit and ending with the balance sheet date. 
C) start of the fiscal year under audit and ending with the date of the auditor's report 
D) balance sheet date and ending with the date the registration statement becomes effective.

Question 6

Which of the following procedures might be useful in discovering a contingent liability for a lawsuit that management is intentionally neglecting to disclose?

Accepted Answer

A) inquiries (orally and in writing)of management 
B) analyzing legal expense and reviewing invoices and statements from outside legal counsel 
C) reviewing current and previous years' Canada Revenue Agency correspondence 
D) obtaining a letter of representation from management that it is not aware of any undisclosed contingent liabilities 
A) inquiries (orally and in writing)of management 
B) analyzing legal expense and reviewing invoices and statements from outside legal counsel 
C) reviewing current and previous years' Canada Revenue Agency correspondence 
D) obtaining a letter of representation from management that it is not aware of any undisclosed contingent liabilities

Question 7

List the factors that could cause a quantitatively small misstatement to be a material misstatement.

Accepted Answer

Factors that could cause a quantitativel

Question 8

Besides the search for contingent liabilities and the review for subsequent events,the auditor has important final evidence accumulation responsibilities,all of which are required by current professional auditing standards.Discuss each of these responsibilities.

Accepted Answer

Three types of evidence accumulation are

Question 9

What audit approach is used to search for unknown commitments?

Accepted Answer

A) include as part of the search for subsequent events 
B) conduct with substantive tests associated with the cutoff assertion 
C) perform as part of the audit of each cycle or audit area 
D) include with the legal letter sent to lawyers 
A) include as part of the search for subsequent events 
B) conduct with substantive tests associated with the cutoff assertion 
C) perform as part of the audit of each cycle or audit area 
D) include with the legal letter sent to lawyers

Question 10

When the proper disclosure in the financial statements of material contingencies is through footnotes,the footnote should describe the nature of the contingency to the extent it is known and

Accepted Answer

A) the auditor's opinion as to the expected outcome. 
B) the opinion of legal counsel or management as to the expected outcome. 
C) an estimate of the amount or a statement that the amount cannot be estimated. 
D) the steps the client has taken to ensure that it doesn't recur. 
A) the auditor's opinion as to the expected outcome. 
B) the opinion of legal counsel or management as to the expected outcome. 
C) an estimate of the amount or a statement that the amount cannot be estimated. 
D) the steps the client has taken to ensure that it doesn't recur.

Question 11

The auditor has a responsibility to review transactions and activities occurring after the year-end to determine whether anything occurred that might affect the valuation or disclosure of the statements being audited.The auditing procedures required to verify these transactions are commonly referred to as the review for

Accepted Answer

A) contingent liabilities. 
B) subsequent year's transactions. 
C) late unusual occurrences. 
D) subsequent events. 
A) contingent liabilities. 
B) subsequent year's transactions. 
C) late unusual occurrences. 
D) subsequent events.

Question 12

IFRS uses specific terminology to refer to the likelihood of the occurrence of an organizational event.Which of the following would need to provide for the recognition of the obligation (i.e.the financial statements adjusted)?

Accepted Answer

A) outflow of resources is required,but cannot be reliably estimated 
B) probable that an outflow of resources is required 
C) likelihood is remote 
D) amount is yet to be confirmed 
A) outflow of resources is required,but cannot be reliably estimated 
B) probable that an outflow of resources is required 
C) likelihood is remote 
D) amount is yet to be confirmed

Question 13

Describe the items the auditor is required to report to the audit committee.

Accepted Answer

The auditor is required to report to the

Question 14

Which of the following is a required condition for a contingent liability to exist?

Accepted Answer

A) There is a potential liability to an employee of the client. 
B) The amount of the future payment is known. 
C) The liability resulted from known events. 
D) The outcome has been resolved by a current event. 
A) There is a potential liability to an employee of the client. 
B) The amount of the future payment is known. 
C) The liability resulted from known events. 
D) The outcome has been resolved by a current event.

An agreement that commits the firm to a set of fixed conditions in the future regardless of what happens to profits or the economy as a whole is a definition of a

There are two categories of lawsuits: outstanding (or asserted)claims,and

Subsequent events affecting the valuation of assets ordinarily will require adjustments of the financial statements under examination because such events typically represent the

List the audit procedures the auditor conducts for subsequent events.

The auditor's responsibility for "reviewing the subsequent events" of a client is normally limited to the period of time beginning with the

Which of the following procedures might be useful in discovering a contingent liability for a lawsuit that management is intentionally neglecting to disclose?

List the factors that could cause a quantitatively small misstatement to be a material misstatement.

Besides the search for contingent liabilities and the review for subsequent events,the auditor has important final evidence accumulation responsibilities,all of which are required by current professional auditing standards.Discuss each of these responsibilities.

What audit approach is used to search for unknown commitments?

When the proper disclosure in the financial statements of material contingencies is through footnotes,the footnote should describe the nature of the contingency to the extent it is known and

IFRS uses specific terminology to refer to the likelihood of the occurrence of an organizational event.Which of the following would need to provide for the recognition of the obligation (i.e.the financial statements adjusted)?

Describe the items the auditor is required to report to the audit committee.

Which of the following is a required condition for a contingent liability to exist?

The Demand for Audit and Other Assurance Services

The Public Accounting Profession and Audit Quality

Professional Ethics and Legal Liability

Audit Responsibilities and Objectives

Audit Evidence

Client Acceptance,Planning,and Materiality

Assessing the Risk of Material Misstatement

Internal Control and COSO Framework

Assessing Control Risk and Designing Test of Controls

Develop Risk Response: Audit Strategy and Audit Program

Audit Sampling Concepts

Audit of the Revenue Cycle

Audit of the Acquisition and Payment Cycle

Audit of the Inventory and Distribution Cycle

Audit of the Human Resources and Payroll Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash Balances

Audit Reports on Financial Statements

Other Assurance and Nonassurance Services

Filters

Exam 18: Completing the Audit

An agreement that commits the firm to a set of fixed conditions in the future regardless of what happens to profits or the economy as a whole is a definition of a

There are two categories of lawsuits: outstanding (or asserted)claims,and

Subsequent events affecting the valuation of assets ordinarily will require adjustments of the financial statements under examination because such events typically represent the

List the audit procedures the auditor conducts for subsequent events.

The auditor's responsibility for "reviewing the subsequent events" of a client is normally limited to the period of time beginning with the

Which of the following procedures might be useful in discovering a contingent liability for a lawsuit that management is intentionally neglecting to disclose?

List the factors that could cause a quantitatively small misstatement to be a material misstatement.

Besides the search for contingent liabilities and the review for subsequent events,the auditor has important final evidence accumulation responsibilities,all of which are required by current professional auditing standards.Discuss each of these responsibilities.

What audit approach is used to search for unknown commitments?

When the proper disclosure in the financial statements of material contingencies is through footnotes,the footnote should describe the nature of the contingency to the extent it is known and

IFRS uses specific terminology to refer to the likelihood of the occurrence of an organizational event.Which of the following would need to provide for the recognition of the obligation (i.e.the financial statements adjusted)?

Describe the items the auditor is required to report to the audit committee.

Which of the following is a required condition for a contingent liability to exist?

The Demand for Audit and Other Assurance Services

The Public Accounting Profession and Audit Quality

Professional Ethics and Legal Liability

Audit Responsibilities and Objectives

Audit Evidence

Client Acceptance,Planning,and Materiality

Assessing the Risk of Material Misstatement

Internal Control and COSO Framework

Assessing Control Risk and Designing Test of Controls

Develop Risk Response: Audit Strategy and Audit Program

Audit Sampling Concepts

Audit of the Revenue Cycle

Audit of the Acquisition and Payment Cycle

Audit of the Inventory and Distribution Cycle

Audit of the Human Resources and Payroll Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash Balances

Audit Reports on Financial Statements

Other Assurance and Nonassurance Services

Filters