Question 1

Which of the following types of procedures will be performed in an audit of internal control over financial reporting?

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 2

Auditing standards require a written audit program.

Accepted Answer

A) True 
 B)False

Question 3

In order to promote audit efficiency the auditor considers cost in selecting audit tests to perform.Which of the following audit tests would be the most costly?

Accepted Answer

A)  Analytical procedures 
B)  Risk assessment procedures 
C)  Tests of controls 
D)  Tests of details of balances 
A)  Analytical procedures 
B)  Risk assessment procedures 
C)  Tests of controls 
D)  Tests of details of balances

Question 4

Which of the following is generally not included in the "evidence mix"?

Accepted Answer

A)  Tests of controls 
B)  Substantive tests of transactions 
C)  Risk assessment procedures 
D)  Tests of details of balances 
A)  Tests of controls 
B)  Substantive tests of transactions 
C)  Risk assessment procedures 
D)  Tests of details of balances

Question 5

Auditing standards recognize that in instances where a significant amount of audit evidence is in electronic form,it may not be possible to reduce detection risk to an acceptable level by performing only substantive tests.

Accepted Answer

A) True 
 B)False

Question 6

If internal controls are tested and are considered effective,the auditor generally will increase both substantive tests of transactions and tests of details of balances.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is/are performed in an audit of internal control over financial reporting?

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 8

Which of the following is not a valid basis for omitting an audit test in forming an opinion on the clients financial statements?

Accepted Answer

A)  The difficulty and expense involved in testing a particular item 
B)  The relative risk involved 
C)  The degree of reliance on the relevant internal controls 
D)  The relationship between the cost of obtaining evidence and its usefulness 
A)  The difficulty and expense involved in testing a particular item 
B)  The relative risk involved 
C)  The degree of reliance on the relevant internal controls 
D)  The relationship between the cost of obtaining evidence and its usefulness

Question 9

Tests of controls are generally more costly to perform than analytical procedures.

Accepted Answer

A) True 
 B)False

Question 10

Auditors must use considerable professional judgment to determine any change in audit procedures that can be made when the level of inherent risk is increased or decreased.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following would not be considered further audit procedures?

Accepted Answer

A)  Tests of controls 
B)  Analytical procedures 
C)  Tests of details of balances 
D)  Risk assessment procedures 
A)  Tests of controls 
B)  Analytical procedures 
C)  Tests of details of balances 
D)  Risk assessment procedures

Question 12

Discuss the purposes of (1)substantive tests of transactions,(2)tests of controls,and (3)tests of details of balances.Give an example of each.

Accepted Answer

The purpose of substantive tests of tran

Question 13

The evidence mix includes risk assessment procedures.

Accepted Answer

A) True 
 B)False

Question 14

Tests of controls should be performed after substantive tests of transactions.

Accepted Answer

A) True 
 B)False

Question 15

In accumulating final evidence upon which to base an audit opinion,the auditor should perform four activities.List the activities below.

Accepted Answer

1.Perform final analytical procedures
2.

Question 16

Shown below (1 through 5)are the five types of tests which auditors use to determine whether financial statements are fairly stated.Which three are substantive tests?
1)Risk assessment procedures
2)Tests of controls
3)Tests of transactions
4)Substantive analytical procedures
5)Tests of details of balances

Accepted Answer

A)  1, 2, and 3. 
B)  3, 4, and 5. 
C)  2, 3, and 5. 
D)  2, 3, and 4. 
A)  1, 2, and 3. 
B)  3, 4, and 5. 
C)  2, 3, and 5. 
D)  2, 3, and 4.

Question 17

Tests of controls are directed toward the control's:

Accepted Answer

A)  efficiency. 
B)  effectiveness. 
C)  cost and effectiveness. 
D)  cost benefit ratio. 
A)  efficiency. 
B)  effectiveness. 
C)  cost and effectiveness. 
D)  cost benefit ratio.

Question 18

Which of the following audit tests would be regarded as a test of controls?

Accepted Answer

A)  Comparison of the inventory pricing to vendors' invoices 
B)  Tests of the signatures on canceled checks to board of directors' authorizations 
C)  Tests of the additions to property, plant, and equipment by physical inspections 
D)  Review of the specific items making up the balance in a given general ledger account 
A)  Comparison of the inventory pricing to vendors' invoices 
B)  Tests of the signatures on canceled checks to board of directors' authorizations 
C)  Tests of the additions to property, plant, and equipment by physical inspections 
D)  Review of the specific items making up the balance in a given general ledger account

Question 19

Which of the following ultimately determines the specific audit procedures necessary to provide an independent auditor with a reasonable basis for the expression of an opinion?

Accepted Answer

A)  The audit program 
B)  The auditor's judgment 
C)  Generally accepted auditing standards 
D)  The auditor's working papers 
A)  The audit program 
B)  The auditor's judgment 
C)  Generally accepted auditing standards 
D)  The auditor's working papers

Question 20

Only tests of details of balances involve physical examination and confirmation.

Accepted Answer

A) True 
 B)False

Exam 13: Developing the Overall Audit Plan and Audit Program

Which of the following types of procedures will be performed in an audit of internal control over financial reporting?

Auditing standards require a written audit program.

In order to promote audit efficiency the auditor considers cost in selecting audit tests to perform.Which of the following audit tests would be the most costly?

Which of the following is generally not included in the "evidence mix"?

Auditing standards recognize that in instances where a significant amount of audit evidence is in electronic form,it may not be possible to reduce detection risk to an acceptable level by performing only substantive tests.

If internal controls are tested and are considered effective,the auditor generally will increase both substantive tests of transactions and tests of details of balances.

Which of the following is/are performed in an audit of internal control over financial reporting?

Which of the following is not a valid basis for omitting an audit test in forming an opinion on the clients financial statements?

Tests of controls are generally more costly to perform than analytical procedures.

Auditors must use considerable professional judgment to determine any change in audit procedures that can be made when the level of inherent risk is increased or decreased.

Which of the following would not be considered further audit procedures?

Discuss the purposes of (1)substantive tests of transactions,(2)tests of controls,and (3)tests of details of balances.Give an example of each.

The evidence mix includes risk assessment procedures.

Tests of controls should be performed after substantive tests of transactions.

In accumulating final evidence upon which to base an audit opinion,the auditor should perform four activities.List the activities below.

Tests of controls are directed toward the control's:

Which of the following audit tests would be regarded as a test of controls?

Which of the following ultimately determines the specific audit procedures necessary to provide an independent auditor with a reasonable basis for the expression of an opinion?

Only tests of details of balances involve physical examination and confirmation.

The Assurance Services Market

The Audit Standards Setting Process

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

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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