Question 1

Discuss the actions an auditor should take when an illegal act is identified or suspected.

Accepted Answer

When an auditor discovers or suspects no

Question 2

Fraudulent financial reporting is most likely to be committed by whom?

Accepted Answer

A)  Line employees of the company 
B)  Outside members of the company's board of directors 
C)  Company management 
D)  The company's auditors 
A)  Line employees of the company 
B)  Outside members of the company's board of directors 
C)  Company management 
D)  The company's auditors

Question 3

If the auditor believes that the financial statements are not fairly stated or is unable to reach a conclusion because of insufficient evidence,the auditor:

Accepted Answer

A)  should withdraw from the engagement. 
B)  should request an increase in audit fees so that more resources can be used to conduct the audit. 
C)  has the responsibility of notifying financial statement users through the auditor's report. 
D)  should notify regulators of the circumstances. 
A)  should withdraw from the engagement. 
B)  should request an increase in audit fees so that more resources can be used to conduct the audit. 
C)  has the responsibility of notifying financial statement users through the auditor's report. 
D)  should notify regulators of the circumstances.

Question 4

Which of the following is an accurate statement concerning the auditor's responsibility to consider laws and regulations?

Accepted Answer

A)  Auditors can follow an easy, step-by-step procedure to determine how laws and regulations impact the financial statements. 
B)  The auditor's responsibility will depend on whether the laws or regulations are expected to have a direct impact on the financial statements. 
C)  It is the responsibility of the auditor to determine if an act constitutes noncompliance. 
D)  The auditor must inform an outside party if management has knowingly not complied with a law or regulation. 
A)  Auditors can follow an easy, step-by-step procedure to determine how laws and regulations impact the financial statements. 
B)  The auditor's responsibility will depend on whether the laws or regulations are expected to have a direct impact on the financial statements. 
C)  It is the responsibility of the auditor to determine if an act constitutes noncompliance. 
D)  The auditor must inform an outside party if management has knowingly not complied with a law or regulation.

Question 5

If a sale was for a valid shipment,but the amount of the sales invoice was calculated incorrectly,the accuracy objective was violated.

Accepted Answer

A) True 
 B)False

Question 6

Under the cycle approach to segmenting an audit,transactions recorded in different journals should never be combined with the general ledger balances that result from those transactions.

Accepted Answer

A) True 
 B)False

Question 7

Under the cycle approach,the only accounts that have two or more cycles associated with them are cash and accounts receivable.

Accepted Answer

A) True 
 B)False

Question 8

The auditor's evaluation of the likelihood of material employee fraud is normally done initially as a part of:

Accepted Answer

A)  tests of controls. 
B)  tests of transactions. 
C)  understanding the entity's internal control. 
D)  the assessment of whether to accept the audit engagement. 
A)  tests of controls. 
B)  tests of transactions. 
C)  understanding the entity's internal control. 
D)  the assessment of whether to accept the audit engagement.

Question 9

Auditing standards make ________ distinction(s)between the auditor's responsibilities for searching for errors and fraud.

Accepted Answer

A)  little 
B)  a significant 
C)  no 
D)  various 
A)  little 
B)  a significant 
C)  no 
D)  various

Question 10

Auditors have found that the most efficient way to conduct audits is to focus primarily on testing classes of transactions and performing tests of ending account balances.

Accepted Answer

A) True 
 B)False

Question 11

Rights and obligations is the only balance-related assertion without a similar transaction related assertion.

Accepted Answer

A) True 
 B)False

Question 12

When an auditor has reduced assessed control risk based on tests of controls,he or she may then reduce the extent to which the accuracy of the financial statement information directly related to those controls must be supported through the accumulation of evidence using substantive tests.

Accepted Answer

A) True 
 B)False

Discuss the actions an auditor should take when an illegal act is identified or suspected.

Fraudulent financial reporting is most likely to be committed by whom?

If the auditor believes that the financial statements are not fairly stated or is unable to reach a conclusion because of insufficient evidence,the auditor:

Which of the following is an accurate statement concerning the auditor's responsibility to consider laws and regulations?

If a sale was for a valid shipment,but the amount of the sales invoice was calculated incorrectly,the accuracy objective was violated.

Under the cycle approach to segmenting an audit,transactions recorded in different journals should never be combined with the general ledger balances that result from those transactions.

Under the cycle approach,the only accounts that have two or more cycles associated with them are cash and accounts receivable.

The auditor's evaluation of the likelihood of material employee fraud is normally done initially as a part of:

Auditing standards make ________ distinction(s)between the auditor's responsibilities for searching for errors and fraud.

Auditors have found that the most efficient way to conduct audits is to focus primarily on testing classes of transactions and performing tests of ending account balances.

Rights and obligations is the only balance-related assertion without a similar transaction related assertion.

When an auditor has reduced assessed control risk based on tests of controls,he or she may then reduce the extent to which the accuracy of the financial statement information directly related to those controls must be supported through the accumulation of evidence using substantive tests.

The Assurance Services Market

The Audit Standards Setting Process

Audit Reports

Legal Liability Considerations for Auditors

Ethics and the Audit Profession

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

Filters

Exam 6: Audit Responsibilities and Objectives

Discuss the actions an auditor should take when an illegal act is identified or suspected.

Fraudulent financial reporting is most likely to be committed by whom?

If the auditor believes that the financial statements are not fairly stated or is unable to reach a conclusion because of insufficient evidence,the auditor:

Which of the following is an accurate statement concerning the auditor's responsibility to consider laws and regulations?

If a sale was for a valid shipment,but the amount of the sales invoice was calculated incorrectly,the accuracy objective was violated.

Under the cycle approach to segmenting an audit,transactions recorded in different journals should never be combined with the general ledger balances that result from those transactions.

Under the cycle approach,the only accounts that have two or more cycles associated with them are cash and accounts receivable.

The auditor's evaluation of the likelihood of material employee fraud is normally done initially as a part of:

Auditing standards make ________ distinction(s)between the auditor's responsibilities for searching for errors and fraud.

Auditors have found that the most efficient way to conduct audits is to focus primarily on testing classes of transactions and performing tests of ending account balances.

Rights and obligations is the only balance-related assertion without a similar transaction related assertion.

When an auditor has reduced assessed control risk based on tests of controls,he or she may then reduce the extent to which the accuracy of the financial statement information directly related to those controls must be supported through the accumulation of evidence using substantive tests.

The Assurance Services Market

The Audit Standards Setting Process

Audit Reports

Legal Liability Considerations for Auditors

Ethics and the Audit Profession

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

Filters