Exam 2: The Audit Standards Setting Process

Sarbanes-Oxley and the Securities Exchange Commission restrict auditors from providing many consulting services to their publicly traded audit clients.Which of the following is true for auditors of publicly traded companies? I.They are restricted from providing consulting services to privately held companies. II.There is no restriction on providing consulting services to non-audit clients.

(Multiple Choice)

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Question 61

Quality controls are established for the entire CPA firm whereas GAAS are applicable to the individual engagement.

(True/False)

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Question 62

The AICPA has authority to establish standards and rules in all but which of the following areas?

(Multiple Choice)

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Question 63

If an auditor of a public company cannot find guidance issued by the PCAOB on a particular audit matter,the auditor should generally seek guidance from which of the following sources?

(Multiple Choice)

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Question 64

The overall purpose of the Securities and Exchange Commission is to assist in providing investors with reliable information upon which to make investment decisions.

(True/False)

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Question 65

Which of the following is an element of the CPA's quality control system that should be considered in establishing its quality control policies and procedures?

(Multiple Choice)

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Question 66

To obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement,the auditor must fulfill several performance responsibilities,including:

(Multiple Choice)

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Question 67

Showing 61 - 67 of 67

Quality controls are established for the entire CPA firm whereas GAAS are applicable to the individual engagement.

The AICPA has authority to establish standards and rules in all but which of the following areas?

If an auditor of a public company cannot find guidance issued by the PCAOB on a particular audit matter,the auditor should generally seek guidance from which of the following sources?

The overall purpose of the Securities and Exchange Commission is to assist in providing investors with reliable information upon which to make investment decisions.

Which of the following is an element of the CPA's quality control system that should be considered in establishing its quality control policies and procedures?

To obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement,the auditor must fulfill several performance responsibilities,including:

The Assurance Services Market

Audit Reports

Legal Liability Considerations for Auditors

Ethics and the Audit Profession

Audit Responsibilities and Objectives

Nature and Type of Audit Evidence

Audit Planning

Considering Materiality and Audit Risk

Considering Internal Control

Considering the Risk of Fraud

Implications of Information Technology for the Audit Process

Developing the Overall Audit Plan and Audit Program

Audit of the Sales and Collection Cycle: Tests of Controls and Substantive Tests of Transactions

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, Substantive Tests of Transactions, and Accounts Payable

Completing the Tests in the Acquisition and Payment Cycle: Verification of Selected Accounts

Audit of the Inventory and Warehousing Cycle

Audit of the Payroll and Personnel Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash and Financial Instruments

Audit Completion

Other Assurance Services

Internal and Governmental Financial Auditing and Operational Auditing

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