Exam 3: Audit Planning, Types of Audit Tests, and Materiality

To provide for the greatest degree of independence in performing internal audit activities,the internal audit function most likely should report to the

The external auditor is required to make a number of important communications to the audit committee during or at the end of the audit engagement.

Tolerable misstatement is

Which of the following is the most important qualitative factor that auditors should consider when making materiality judgments?

An independent auditor might consider the procedures performed by the internal audit function because

Which of the following would not necessarily be a related party transaction?

An entity's financial statements were misstated over a period of years due to large amounts of revenue being recorded in journal entries that involved debits and credits to an illogical combination of accounts.The auditor could most likely have been alerted to this fraud by

The audit client's board of directors and audit committee refused to take any action with respect to an immaterial illegal act which was brought to their attention by the auditor.Because of their failure to act,the auditor withdrew from the engagement.The auditor's decision to withdraw was primarily due to doubts concerning

The engagement partner is typically responsible for doing the detailed audit testing.

An auditor is required to establish an understanding with a client regarding the responsibilities for each engagement.This understanding generally includes

Engagement letters include all of the following except:

The existence of a related party transaction may be indicated when another entity

Which of the following is not a concern as to whether a misstatement is qualitatively material?

Which of the following should an auditor obtain from the predecessor auditor prior to accepting an audit engagement?

In the planning stages of an audit,what information does an auditor gain through analytical procedures?

Name three Sarbanes-Oxley Act requirements of the members and duties of the audit committee of a public company.

How would an auditor identify related parties and what is the importance of doing so?

In assessing whether to accept a client for an audit engagement,a CPA should consider

The first phase of audit planning is risk assessment.

There are five general types of audit tests.