Question 1

In making the technical review of the financial statements, the auditor is likely to use a detailed financial statement checklist provided by:

Accepted Answer

A) the client. 
B) CPA Australia. 
C) the ASIC. 
D) the audit firm. 
A) the client. 
B) CPA Australia. 
C) the ASIC. 
D) the audit firm.

Question 2

The auditing standards suggest that management representations are acceptable audit evidence where other sufficient appropriate audit evidence:

Accepted Answer

A) management representations are never appropriate audit evidence for financial statement assertions. 
B) cannot reasonably be expected to exist. 
C) can reasonably be expected to exist. 
D) has not been furnished to the auditor. 
A) management representations are never appropriate audit evidence for financial statement assertions. 
B) cannot reasonably be expected to exist. 
C) can reasonably be expected to exist. 
D) has not been furnished to the auditor.

Question 3

If the auditor discovers that management intends to liquidate the entity:

Accepted Answer

A) it is irrelevant if they did not intend to liquidate the entity at reporting date. 
B) it requires inclusion as a disclaimer of opinion. 
C) it requires inclusion as an 'except for' opinion. 
D) the going concern basis is inappropriate. 
A) it is irrelevant if they did not intend to liquidate the entity at reporting date. 
B) it requires inclusion as a disclaimer of opinion. 
C) it requires inclusion as an 'except for' opinion. 
D) the going concern basis is inappropriate.

Question 4

Significant matters identified as a result of audit procedures often include those relating to the internal control structure that the auditor feels would be of particular interest to:

Accepted Answer

A) the CEO. 
B) the regulators. 
C) the accounting staff. 
D) the audit committee. 
A) the CEO. 
B) the regulators. 
C) the accounting staff. 
D) the audit committee.

Question 5

When a question arises regarding the going-concern basis, additional procedures may be necessary.Which of the following procedures is an example of a valid additional procedure?

Accepted Answer

A) Evaluate management's plans for future actions in relation to its going concern assessment. 
B) Consider whether any additional facts or information have become available since the date on which management made its assessment. 
C) Where the entity has prepared a cash flow forecast, and analysis of the forecast is a significant factor in considering the future outcome of events or conditions in the evaluation of management's plans for future actions, determine whether there is adequate support for the assumptions underlying the forecast. 
D) All of the above. 
A) Evaluate management's plans for future actions in relation to its going concern assessment. 
B) Consider whether any additional facts or information have become available since the date on which management made its assessment. 
C) Where the entity has prepared a cash flow forecast, and analysis of the forecast is a significant factor in considering the future outcome of events or conditions in the evaluation of management's plans for future actions, determine whether there is adequate support for the assumptions underlying the forecast. 
D) All of the above.

Question 6

Professional standards require the auditor to communicate certain matters pertaining to the audit to those charged with governance.This communication would normally include all of the following except:

Accepted Answer

A) disagreements with management. 
B) audit adjustments. 
C) specific audit procedures performed. 
D) material uncertainties that may cast doubt on the entity's ability to continue as a going concern. 
A) disagreements with management. 
B) audit adjustments. 
C) specific audit procedures performed. 
D) material uncertainties that may cast doubt on the entity's ability to continue as a going concern.

Question 7

Where an event occurring after the end of the reporting period provides new information that does not relate to conditions existing at year end and, if its non-disclosure has the potential to adversely affect decisions made by users of the financial statements:

Accepted Answer

A) it is required to be disclosed in the notes to the accounts. 
B) it is an adjusting event. 
C) it is a non-adjusting event. 
D) a and C 
A) it is required to be disclosed in the notes to the accounts. 
B) it is an adjusting event. 
C) it is a non-adjusting event. 
D) a and C

Question 8

What are the objectives of the management representation letter? Under what circumstances are management representations considered acceptable audit evidence?

Accepted Answer

The objectives of the management represe

Question 9

Ordinarily, an event indicating a material condition arising after the reporting date requires:

Accepted Answer

A) disclosure. 
B) adjustment. 
C) inclusion as an 'except for'. 
D) adjustment and disclosure. 
A) disclosure. 
B) adjustment. 
C) inclusion as an 'except for'. 
D) adjustment and disclosure.

Question 10

Before reaching a final decision on the audit opinion to be issued, a conference is generally held with the client.At this meeting, all of the following may be expected, except:

Accepted Answer

A) an oral report of the auditor's major findings. 
B) the auditor's rationale for proposed adjustments or additional disclosures. 
C) delivery of the written communication of audit matters to those charged with governance. 
D) agreement between the auditor and client on the changes to be made. 
A) an oral report of the auditor's major findings. 
B) the auditor's rationale for proposed adjustments or additional disclosures. 
C) delivery of the written communication of audit matters to those charged with governance. 
D) agreement between the auditor and client on the changes to be made.

Question 11

The auditor has decided that the financial statements are affected by an uncertainty that is not susceptible to reasonable estimation at the balance sheet date.If this uncertainty is adequately disclosed in the financial statements, the auditor's report should contain a(n):

Accepted Answer

A) standard unqualified opinion. 
B) adverse opinion. 
C) disclaimer of opinion. 
D) unqualified opinion with an 'emphasis of matter' paragraph. 
A) standard unqualified opinion. 
B) adverse opinion. 
C) disclaimer of opinion. 
D) unqualified opinion with an 'emphasis of matter' paragraph.

Question 12

The subsequent event that is an example of a condition occurring after the reporting date is:

Accepted Answer

A) realisation of recorded year-end receivables at a different amount than recorded. 
B) settlement of recorded year-end estimated product warranty liabilities at a different amount than recorded. 
C) determining the proceeds of assets sold before the end of the reporting period. 
D) purchase of a business. 
A) realisation of recorded year-end receivables at a different amount than recorded. 
B) settlement of recorded year-end estimated product warranty liabilities at a different amount than recorded. 
C) determining the proceeds of assets sold before the end of the reporting period. 
D) purchase of a business.

Question 13

The event in a subsequent period that is an example of a condition existing at the reporting date is:

Accepted Answer

A) loss resulting from a flood. 
B) discovery of fraud or errors. 
C) purchase of a business. 
D) the issue of preferred shares. 
A) loss resulting from a flood. 
B) discovery of fraud or errors. 
C) purchase of a business. 
D) the issue of preferred shares.

Question 14

For subsequent events occurring during the post-audit period, auditors have a responsibility to:

Accepted Answer

A) examine only events that come to their attention and that existed at the date of the auditor's report. 
B) discover and evaluate all subsequent events that may have a material effect on the financial statements. 
C) examine only events that come to their attention. 
D) none of the above. 
A) examine only events that come to their attention and that existed at the date of the auditor's report. 
B) discover and evaluate all subsequent events that may have a material effect on the financial statements. 
C) examine only events that come to their attention. 
D) none of the above.

In making the technical review of the financial statements, the auditor is likely to use a detailed financial statement checklist provided by:

The auditing standards suggest that management representations are acceptable audit evidence where other sufficient appropriate audit evidence:

If the auditor discovers that management intends to liquidate the entity:

Significant matters identified as a result of audit procedures often include those relating to the internal control structure that the auditor feels would be of particular interest to:

When a question arises regarding the going-concern basis, additional procedures may be necessary.Which of the following procedures is an example of a valid additional procedure?

Professional standards require the auditor to communicate certain matters pertaining to the audit to those charged with governance.This communication would normally include all of the following except:

Where an event occurring after the end of the reporting period provides new information that does not relate to conditions existing at year end and, if its non-disclosure has the potential to adversely affect decisions made by users of the financial statements:

What are the objectives of the management representation letter? Under what circumstances are management representations considered acceptable audit evidence?

Ordinarily, an event indicating a material condition arising after the reporting date requires:

Before reaching a final decision on the audit opinion to be issued, a conference is generally held with the client.At this meeting, all of the following may be expected, except:

The auditor has decided that the financial statements are affected by an uncertainty that is not susceptible to reasonable estimation at the balance sheet date.If this uncertainty is adequately disclosed in the financial statements, the auditor's report should contain a(n):

The subsequent event that is an example of a condition occurring after the reporting date is:

The event in a subsequent period that is an example of a condition existing at the reporting date is:

For subsequent events occurring during the post-audit period, auditors have a responsibility to:

An Overview of Auditing

Governance and the Auditor

Professional Ethics, Regulation and Liability

Quality and Standards of Assurance Engagements

Overview of the Audit Financial Reports

The Auditors Report

Client Evaluation and Planning the Audit

Audit Risk Assessment

Materiality and Audit Evidence

Tests of Controls

Designing Substantive Procedures

Managing Audit Data

Filters

Exam 13: Completing the Audit

In making the technical review of the financial statements, the auditor is likely to use a detailed financial statement checklist provided by:

The auditing standards suggest that management representations are acceptable audit evidence where other sufficient appropriate audit evidence:

If the auditor discovers that management intends to liquidate the entity:

Significant matters identified as a result of audit procedures often include those relating to the internal control structure that the auditor feels would be of particular interest to:

When a question arises regarding the going-concern basis, additional procedures may be necessary.Which of the following procedures is an example of a valid additional procedure?

Professional standards require the auditor to communicate certain matters pertaining to the audit to those charged with governance.This communication would normally include all of the following except:

Where an event occurring after the end of the reporting period provides new information that does not relate to conditions existing at year end and, if its non-disclosure has the potential to adversely affect decisions made by users of the financial statements:

What are the objectives of the management representation letter? Under what circumstances are management representations considered acceptable audit evidence?

Ordinarily, an event indicating a material condition arising after the reporting date requires:

Before reaching a final decision on the audit opinion to be issued, a conference is generally held with the client.At this meeting, all of the following may be expected, except:

The auditor has decided that the financial statements are affected by an uncertainty that is not susceptible to reasonable estimation at the balance sheet date.If this uncertainty is adequately disclosed in the financial statements, the auditor's report should contain a(n):

The subsequent event that is an example of a condition occurring after the reporting date is:

The event in a subsequent period that is an example of a condition existing at the reporting date is:

For subsequent events occurring during the post-audit period, auditors have a responsibility to:

An Overview of Auditing

Governance and the Auditor

Professional Ethics, Regulation and Liability

Quality and Standards of Assurance Engagements

Overview of the Audit Financial Reports

The Auditors Report

Client Evaluation and Planning the Audit

Audit Risk Assessment

Materiality and Audit Evidence

Tests of Controls

Designing Substantive Procedures

Managing Audit Data

Filters