Question 1

Which of the following factors most likely would cause an auditor to not accept a new audit engagement?

Accepted Answer

A) An inadequate understanding of the entity's internal control. 
B) The close proximity to the end of the entity's financial year. 
C) The conclusion that the entity's management probably lacks integrity. 
D) An inability to perform preliminary analytical procedures before assessing control risk. 
A) An inadequate understanding of the entity's internal control. 
B) The close proximity to the end of the entity's financial year. 
C) The conclusion that the entity's management probably lacks integrity. 
D) An inability to perform preliminary analytical procedures before assessing control risk.

Question 2

What is the responsibility of an auditor with respect to communicating with the previous auditor in connection with a prospective new audit client?

Accepted Answer

A) The auditor has no responsibility to contact the previous auditor. 
B) The auditor should contact the previous auditor regardless of whether the prospective client authorises contact. 
C) The auditor need not contact the previous auditor if the successor is aware of all available facts. 
D) The auditor should obtain permission from the prospective client to contact the previous auditor. 
A) The auditor has no responsibility to contact the previous auditor. 
B) The auditor should contact the previous auditor regardless of whether the prospective client authorises contact. 
C) The auditor need not contact the previous auditor if the successor is aware of all available facts. 
D) The auditor should obtain permission from the prospective client to contact the previous auditor.

Question 3

Which of the following actions is the most likely first step that an auditor will perform after accepting an initial audit engagement?

Accepted Answer

A) Prepare a rough draft of the financial report and the auditor's report. 
B) Assess control risk for the assertions embodied in the financial report. 
C) Tour the client's facilities and review the general records. 
D) Consult with and review the work of the previous auditor prior to discussing the engagement with the client management. 
A) Prepare a rough draft of the financial report and the auditor's report. 
B) Assess control risk for the assertions embodied in the financial report. 
C) Tour the client's facilities and review the general records. 
D) Consult with and review the work of the previous auditor prior to discussing the engagement with the client management.

Question 4

One reason why the independent auditor performs analytical procedures of the client's operations is to identify:

Accepted Answer

A) deficiencies of a material nature in the internal control. 
B) unusual transactions. 
C) non-compliance with prescribed control procedures. 
D) improper separation of accounting and other financial duties. 
A) deficiencies of a material nature in the internal control. 
B) unusual transactions. 
C) non-compliance with prescribed control procedures. 
D) improper separation of accounting and other financial duties.

Question 5

Analytical procedures are:

Accepted Answer

A) never required. 
B) required for planning, substantive testing and overall review of the financial report. 
C) required for planning and overall review of the financial report. 
D) required during planning only. 
A) never required. 
B) required for planning, substantive testing and overall review of the financial report. 
C) required for planning and overall review of the financial report. 
D) required during planning only.

Which of the following factors most likely would cause an auditor to not accept a new audit engagement?

What is the responsibility of an auditor with respect to communicating with the previous auditor in connection with a prospective new audit client?

Which of the following actions is the most likely first step that an auditor will perform after accepting an initial audit engagement?

One reason why the independent auditor performs analytical procedures of the client's operations is to identify:

Analytical procedures are:

Assurance and Auditing: An Overview

Audit Regulation, Structure of the Profession and Auditors Liability

Ethics, Independence and Corporate Governance

Overview of Elements of the Financial Report Audit Process

Assessing Inherent Risk, and Other Specific Business Risks

Understanding and Assessing Internal Control

Tests of Controls

Substantive Tests of Transactions and Balances

Completion and Review

The Auditors Reporting Obligations

Other Assurance Services and Advanced Topics

Internal Auditing

Audit and Assurance Services in the Public Sector

Filters

Exam 5: Planning, Understanding the Entity and Assessing Business Risk

Which of the following factors most likely would cause an auditor to not accept a new audit engagement?

What is the responsibility of an auditor with respect to communicating with the previous auditor in connection with a prospective new audit client?

Which of the following actions is the most likely first step that an auditor will perform after accepting an initial audit engagement?

One reason why the independent auditor performs analytical procedures of the client's operations is to identify:

Analytical procedures are:

Assurance and Auditing: An Overview

Audit Regulation, Structure of the Profession and Auditors Liability

Ethics, Independence and Corporate Governance

Overview of Elements of the Financial Report Audit Process

Assessing Inherent Risk, and Other Specific Business Risks

Understanding and Assessing Internal Control

Tests of Controls

Substantive Tests of Transactions and Balances

Completion and Review

The Auditors Reporting Obligations

Other Assurance Services and Advanced Topics

Internal Auditing

Audit and Assurance Services in the Public Sector

Filters