Exam 11: Completing the Audit

For which of the following objectives would auditors be least likely to use analytical procedures near the end of the audit?

Which of the following events occurring after the audit report release date most likely would cause auditors to make further inquiries about the previously-issued financial statements?

Which of the following procedures is not used in auditors' examination of litigation,claims,and assessments?

Auditors must complete various phases of an audit after the date of the financial statements.The auditors' responsibility for matters affecting the client extends from the date of the financial statements to the

If an entity had litigation pending at the date of the financial statements and auditors learn of the outcome of this litigation following the date of their report (but prior to the audit report release date),this is known as a(n)

Why is it the client's decision to record adjustments to the financial statements?

Which of the following is an audit procedure that auditors most likely would perform concerning litigation,claims,and assessments?

Below is a list of events that occur throughout an audit examination.Indicate,using the correct letter,the time period during which these events are most likely to occur.An event may occur in more than one time period. A. Prior to the date of the financial statements. B. Between the date of the financial statements and the date of the auditors' report. C. Between the date of the auditors' report and the audit report release date. D. After the audit report release date. ___ 1. Subsequently discovered facts. ___ 2. Roll-forward work. ___ 3. Attorney letters. ___ 4. Interim testing relating to substantive procedures. ___ 5. Preparation of proposed adjusting journal entries. ___ 6. Dual dating for subsequently discovered facts. ___ 7. Communications with the individuals charged with governance. ___ 8. Written representations. ___ 9. Identification of subsequent events. ___ 10. Interim testing related to tests of controls.

The primary source of information auditors use to obtain information about litigation,claims,and assessments is the

Which of the following procedures would auditors most likely perform to obtain evidence about the occurrence of subsequent events?

Indicate,using the letters C (client),A (auditors),and AT (attorney)which party is responsible for each of the following duties relating to letters of inquiry of attorneys.Each statement is associated with only one party. ___ 1.Respond directly to auditors' initial inquiries regarding litigation,claims,and assessments. ___ 2.Initiate request for attorney letter. ___ 3.Respond to attorney letter. ___ 4.Provide initial description and evaluation of litigation,claims,and assessments. ___ 5.Request attorney letter. ___ 6.Perform various procedures relating to litigation,claims,and assessments. ___ 7.Identify whether client's views expressed in the attorney letter are appropriate. ___ 8.Party the attorney informs if an unasserted claim must be disclosed.

Before the impact of adjusting entries proposed by auditors are included in the client's financial statements,the adjustments must be approved by the

For each of the communications listed below,indicate (1)the time period during which the communication is typically obtained or provided and (2)whether the communication is oral,written,or either oral or written.Use the following abbreviations in providing your answer: A. Prior to the engagement B. Prior to or at the date of the auditors' report C. Following the date of the auditors' report D. Either following the date of the auditors' report or as significant matters are identified E. Oral F. Written G. Either oral or written ___ 1. Engagement letter ___ 2. Acceptance letter (signed copy of engagement letter) ___ 3. Attorney letter response ___ 4. Written representations ___ 5. Internal control deficiencies ___ 6. Communications with individuals charged with governance ___ 7. Management letter

Subsequent events occur between the ____ and the ____.

What is the primary purpose of obtaining written representations?

In an audit of contingent liabilities,which of the following procedures would be least effective?

You are auditing Green Corporation for the calendar year 2014.Among other items related to the audit,Green Corporation was being sued for personal injury resulting from the malfunction of one of their products.The lawsuit was initiated by Sue Ewe in September,2014.Management and the company's outside legal counsel estimated the loss from the suit to be approximately $250,000.This amount is accrued and properly disclosed in the footnotes of the financial statements.You have no reason to believe that the estimate is inaccurate.You completed your audit and dated your report March 2,2015.The financial statements were issued on March 14,2015.On March 20,2015,you read in a national business periodical that the jury in the trial awarded Sue Ewe $1.5 million. Required: Discuss the nature of these events and what responsibility,if any,you have regarding the news of March 20,2015.

Which of the following events or activities may occur following the audit report release date?

Which of the following subsequent events would represent an event that provides information about conditions that arose following the date of the financial statements?

If auditors are appointed on January 3,2014,the date of the financial statements is December 31,2014,the date of the auditors' report is February 7,2015 and the audit report release date is March 3,2015,what is the appropriate date of the written representations?