Exam 26: Internal and Governmental Financial Auditing and Operational Auditing

An audit designed to provide reasonable assurance of detecting material misstatements resulting from noncompliance with provisions of contracts or grant agreements that have a material and direct effect on the financial statements would be called a(n)

(Multiple Choice)

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Question 21

Because they spend all their time within one company,internal auditors have much greater knowledge about the company's operations and internal controls then external auditors.

(True/False)

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Question 22

The correct title of the Yellow Book is

(Multiple Choice)

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Question 23

Which of the following groups could be involved in an operational audit?

(Multiple Choice)

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Question 24

Operational audits are primarily geared towards improving a company's operational efficiency and effectiveness.

(True/False)

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Question 25

External financial statement auditors must obtain evidence regarding what attributes of an internal audit department if the external auditors intend to rely on the internal auditor's work?

(Multiple Choice)

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Question 26

When performing an operational audit,the internal audit team must first determine that

(Multiple Choice)

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Question 27

The primary source of authoritative literature for doing government audits is the

(Multiple Choice)

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Question 28

A typical objective of an operational audit is to determine whether an entity's

(Multiple Choice)

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Question 29

Government Auditing Standards recognize that because of public accountability over governmental activities the acceptable tolerable misstatement as compared to commercial businesses may be

(Multiple Choice)

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Question 30

Internal auditing standards are included in the Blue Book.

(True/False)

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Question 31

Efficiency refers to the degree to which costs are reduced without changing effectiveness.

(True/False)

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Question 32

External auditors typically consider internal auditors effective if they meet three criteria.What are these criteria?

(Essay)

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Question 33

Match seven of the terms (a-o)with the descriptions/definitions provided below (1-7):

the official title of the Yellow Book

special assignment

a management request for an operational audit for a specific purpose such as investigating the possibility of fraud in a division or making recommendations for reducing the cost of a manufactured product

effectiveness

statements issued by the Internal Auditing Standards Board of the Institute of Internal Auditors (IIA)to provide authoritative interpretation of the Institute of Internal Auditors' Practice Standards

functional audit

Correct Answer:

Verified

the official title of the Yellow Book

a management request for an operational audit for a specific purpose such as investigating the possibility of fraud in a division or making recommendations for reducing the cost of a manufactured product

statements issued by the Internal Auditing Standards Board of the Institute of Internal Auditors (IIA)to provide authoritative interpretation of the Institute of Internal Auditors' Practice Standards

federal legislation that provides for a single coordinated audit to satisfy the audit requirements of all federal funding agencies

a government audit to determine whether an entity is acquiring protecting and using its resources economically and efficiently and whether the entity has complied with laws and regulations concerning such matters

the review of an organization for efficiency and effectiveness

the degree to which the organization's objectives are accomplished

(Matching)

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Question 34

External auditors would consider internal auditors effective if they

(Multiple Choice)

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Question 35

An operational auditor may use "engineered standards" as an evaluation criterion.

(True/False)

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Question 36

Operational audits are often categorized as functional,organizational,or special assignments.

(True/False)

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Question 37

Professional guidelines for performing internal audits for companies are not as well-defined as for external audits.

(True/False)

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Question 38

Effectiveness is concerned with whether defined goals are achieved,whereas efficiency is concerned with whether the goals are achieved with a minimum use of resources.

(True/False)

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Question 39

Integrity is one of the Institute of Internal Auditors' ethical principles.

(True/False)

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Question 40

Exam 26: Internal and Governmental Financial Auditing and Operational Auditing

An audit designed to provide reasonable assurance of detecting material misstatements resulting from noncompliance with provisions of contracts or grant agreements that have a material and direct effect on the financial statements would be called a(n)

Because they spend all their time within one company,internal auditors have much greater knowledge about the company's operations and internal controls then external auditors.

The correct title of the Yellow Book is

Which of the following groups could be involved in an operational audit?

Operational audits are primarily geared towards improving a company's operational efficiency and effectiveness.

External financial statement auditors must obtain evidence regarding what attributes of an internal audit department if the external auditors intend to rely on the internal auditor's work?

When performing an operational audit,the internal audit team must first determine that

The primary source of authoritative literature for doing government audits is the

A typical objective of an operational audit is to determine whether an entity's

Government Auditing Standards recognize that because of public accountability over governmental activities the acceptable tolerable misstatement as compared to commercial businesses may be

Internal auditing standards are included in the Blue Book.

Efficiency refers to the degree to which costs are reduced without changing effectiveness.

External auditors typically consider internal auditors effective if they meet three criteria.What are these criteria?

External auditors would consider internal auditors effective if they

An operational auditor may use "engineered standards" as an evaluation criterion.

Operational audits are often categorized as functional,organizational,or special assignments.

Professional guidelines for performing internal audits for companies are not as well-defined as for external audits.

Effectiveness is concerned with whether defined goals are achieved,whereas efficiency is concerned with whether the goals are achieved with a minimum use of resources.

Integrity is one of the Institute of Internal Auditors' ethical principles.

The Demand for Audit and Other Assurance Services

The Cpa Profession

Audit Reports

Professional Ethics

Legal Liability

Audit Responsibilities and Objectives

Audit Evidence

Audit Planning and Analytical Procedures

Materiality and Risk

Fraud Auditing

Internal Control and Coso Framework

Assessing Control Risk and Reporting on Internal Controls

Overall Audit Strategy and Audit Program

Audit of the Sales and Collection Cycle: Tests of Controls

Audit Sampling for Tests of Controls and Substantive Tests of Transactions

Completing the Tests in the Sales and Collection Cycle: Accounts Receivable

Audit Sampling for Tests of Details of Balances

Audit of the Acquisition and Payment Cycle: Tests of Controls,

Completing the Tests in the Acquisition and Payment Cycle:

Audit of the Payroll and Personnel Cycle

Audit of the Inventory and Warehousing Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash and Financial Instruments

Completing the Audit

Other Assurance Services

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