Question 1

An audit of a public company is referred to as an integrated audit.

Accepted Answer

A) True 
 B)False

Question 2

Regarding the PCAOB, which of the following is INCORRECT? The PCAOB:

Accepted Answer

A)  Is responsible for oversight of audit firms engaged in the audit of public companies. 
B)  Issues standards that govern audits of public companies. 
C)  Is a not-for-profit entity. 
D)  Has authority that is equal in power to the SEC. 
A)  Is responsible for oversight of audit firms engaged in the audit of public companies. 
B)  Issues standards that govern audits of public companies. 
C)  Is a not-for-profit entity. 
D)  Has authority that is equal in power to the SEC.

Question 3

Auditors communicate audit results to users concerning a company's financial statements by:

Accepted Answer

A)  issuing a report on the effectiveness of ICFR. 
B)  issuing the financial statements. 
C)  issuing a report about the financial statements. 
D)  None of the above. 
A)  issuing a report on the effectiveness of ICFR. 
B)  issuing the financial statements. 
C)  issuing a report about the financial statements. 
D)  None of the above.

Question 4

The audit engagement team consists of:

Accepted Answer

A)  more than one partner. 
B)  associates and seniors. 
C)  managers. 
D)  All of the above. 
A)  more than one partner. 
B)  associates and seniors. 
C)  managers. 
D)  All of the above.

Question 5

Forensic accountants often investigate fraud.

Accepted Answer

A) True 
 B)False

Question 6

CPAs who perform financial statement audits of public companies are responsible for the accuracy of the client's financial statements.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is an assertion?

Accepted Answer

A)  A statement made by management regarding the collectability of accounts receivable. 
B)  The audit firm's estimation of the client's inventory obsolescence. 
C)  The statement by management regarding the appointment of auditors. 
D)  The statement by management that the firm will close its branch office because of snow. 
A)  A statement made by management regarding the collectability of accounts receivable. 
B)  The audit firm's estimation of the client's inventory obsolescence. 
C)  The statement by management regarding the appointment of auditors. 
D)  The statement by management that the firm will close its branch office because of snow.

Question 8

CPAs who audit public companies may only perform attest services.

Accepted Answer

A) True 
 B)False

Question 9

The types of business structures used by CPA firms are designed to make the professionals who own the firms responsible for providing high quality services.

Accepted Answer

A) True 
 B)False

Question 10

In an ideal situation, internal auditors report to the Audit Committee.

Accepted Answer

A) True 
 B)False

Question 11

Non-assurance type work performed by CPAs includes:

Accepted Answer

A)  Tax preparation. 
B)  Consulting. 
C)  Bookkeeping. 
D)  All of the above. 
A)  Tax preparation. 
B)  Consulting. 
C)  Bookkeeping. 
D)  All of the above.

Question 12

Who is responsible for oversight of the integrated audit function?

Accepted Answer

A)  Shareholders. 
B)  Officers of the company. 
C)  The audit committee. 
D)  None of the above. 
A)  Shareholders. 
B)  Officers of the company. 
C)  The audit committee. 
D)  None of the above.

Question 13

When there is a material misstatement in the financial statements, the auditor requires management of the company to correct the financial statements so the auditor can issue an audit report.

Accepted Answer

A) True 
 B)False

Question 14

A CPA firm engaged in the audit of public companies must:

Accepted Answer

A)  Have at least 5 partners. 
B)  Have multiple offices across the U.S. 
C)  Hire and train competent personnel. 
D)  All of the above. 
A)  Have at least 5 partners. 
B)  Have multiple offices across the U.S. 
C)  Hire and train competent personnel. 
D)  All of the above.

Question 15

For an integrated audit to be possible:

Accepted Answer

A)  Established criteria must exist against which the financial statements and ICFR can be compared. 
B)  The auditor must have sufficient knowledge of both the AICPA SAS and PCAOB AS. 
C)  The entity must have sufficient books, records and other underlying evidence so that the auditor can determine whether there is a high degree of correspondence between the underlying evidence and the financial statements. 
D)  a and c 
A)  Established criteria must exist against which the financial statements and ICFR can be compared. 
B)  The auditor must have sufficient knowledge of both the AICPA SAS and PCAOB AS. 
C)  The entity must have sufficient books, records and other underlying evidence so that the auditor can determine whether there is a high degree of correspondence between the underlying evidence and the financial statements. 
D)  a and c

Question 16

Which functions do audit reports serve for the capital markets?

Accepted Answer

A)  Enhance confidence in financial statements. 
B)  Provide guarantees regarding the quality of investments. 
C)  Provide assurance that financial statements and management's reports on internal control over financial reporting provide reliable information. 
D)  Both a and c 
A)  Enhance confidence in financial statements. 
B)  Provide guarantees regarding the quality of investments. 
C)  Provide assurance that financial statements and management's reports on internal control over financial reporting provide reliable information. 
D)  Both a and c

Question 17

Internal auditors may not perform:

Accepted Answer

A)  Audits of financial statements resulting in reports intended for management's use only. 
B)  Forensic audits. 
C)  Integrated audits leading to an audit opinion issued in accordance with AICPA or PCAOB standards. 
D)  All of the above. 
A)  Audits of financial statements resulting in reports intended for management's use only. 
B)  Forensic audits. 
C)  Integrated audits leading to an audit opinion issued in accordance with AICPA or PCAOB standards. 
D)  All of the above.

Question 18

Which of the following individuals could be a member of the Audit Committee?

Accepted Answer

A)  A member of the company's Board of Directors. 
B)  A member of the PCAOB. 
C)  An audit partner of the CPA firm who performs the annual audit. 
D)  None of the above. 
A)  A member of the company's Board of Directors. 
B)  A member of the PCAOB. 
C)  An audit partner of the CPA firm who performs the annual audit. 
D)  None of the above.

Question 19

Which of the following would not be considered audit evidence?

Accepted Answer

A)  Invoices received by the company and retained on the company's IT system in electronic form. 
B)  The electronic work paper program package used by the auditor to produce the electronic work papers. 
C)  Hard copy minutes of the Board of Directors and Audit Committee meetings. 
D)  Electronic images of the front and back of checks that the company has written. 
A)  Invoices received by the company and retained on the company's IT system in electronic form. 
B)  The electronic work paper program package used by the auditor to produce the electronic work papers. 
C)  Hard copy minutes of the Board of Directors and Audit Committee meetings. 
D)  Electronic images of the front and back of checks that the company has written.

Question 20

If a nonpublic company uses IFRS to prepare its financial statements, it cannot receive an unqualified opinion when audited using the AICPA Statements on Auditing Standards.

Accepted Answer

A) True 
 B)False

An audit of a public company is referred to as an integrated audit.

Regarding the PCAOB, which of the following is INCORRECT? The PCAOB:

Auditors communicate audit results to users concerning a company's financial statements by:

The audit engagement team consists of:

Forensic accountants often investigate fraud.

CPAs who perform financial statement audits of public companies are responsible for the accuracy of the client's financial statements.

Which of the following is an assertion?

CPAs who audit public companies may only perform attest services.

The types of business structures used by CPA firms are designed to make the professionals who own the firms responsible for providing high quality services.

In an ideal situation, internal auditors report to the Audit Committee.

Non-assurance type work performed by CPAs includes:

Who is responsible for oversight of the integrated audit function?

When there is a material misstatement in the financial statements, the auditor requires management of the company to correct the financial statements so the auditor can issue an audit report.

A CPA firm engaged in the audit of public companies must:

For an integrated audit to be possible:

Which functions do audit reports serve for the capital markets?

Internal auditors may not perform:

Which of the following individuals could be a member of the Audit Committee?

Which of the following would not be considered audit evidence?

If a nonpublic company uses IFRS to prepare its financial statements, it cannot receive an unqualified opinion when audited using the AICPA Statements on Auditing Standards.

Overview of an Integrated Audit

The Auditors Role in Society

Legal Environment Affecting Audits Pt Iii Executing an Integrated Audit

Client Acceptance and Continuance and Preliminary Engagement Procedures

Audit Planning and Risk Assessment

Internal Control, Understanding the Clients Internal Control Over Financial Reporting and Auditing Design Effectiveness

Planning and Testing Operating Effectiveness of Internal Control Over Financial Reporting

Substantive Procedures and the Financial Statement Audit

Auditing Revenue Process: Sales, Billing and Collection in the Health-Care Provider and Retailing Industries

Completing the Integrated Audit and Reporting

The Acquisition and Payments Cycle and Related Accounts: Purchases, Cash Disbursements and Other Related Activities in the Automotive Industry

Auditing Human Resources Cycle Process: Personnel and Payroll in Service Industries

Auditing Inventory Processes: Tracking and Costing Products in the Land Development and Home Building Industry

Assets, Liabilities and Equity Related to the Financing Cycle

Topics Beyond the Integrated Audit

Filters

Exam 1: An Introduction to Auditing

An audit of a public company is referred to as an integrated audit.

Regarding the PCAOB, which of the following is INCORRECT? The PCAOB:

Auditors communicate audit results to users concerning a company's financial statements by:

The audit engagement team consists of:

Forensic accountants often investigate fraud.

CPAs who perform financial statement audits of public companies are responsible for the accuracy of the client's financial statements.

Which of the following is an assertion?

CPAs who audit public companies may only perform attest services.

The types of business structures used by CPA firms are designed to make the professionals who own the firms responsible for providing high quality services.

In an ideal situation, internal auditors report to the Audit Committee.

Non-assurance type work performed by CPAs includes:

Who is responsible for oversight of the integrated audit function?

When there is a material misstatement in the financial statements, the auditor requires management of the company to correct the financial statements so the auditor can issue an audit report.

A CPA firm engaged in the audit of public companies must:

For an integrated audit to be possible:

Which functions do audit reports serve for the capital markets?

Internal auditors may not perform:

Which of the following individuals could be a member of the Audit Committee?

Which of the following would not be considered audit evidence?

If a nonpublic company uses IFRS to prepare its financial statements, it cannot receive an unqualified opinion when audited using the AICPA Statements on Auditing Standards.

Overview of an Integrated Audit

The Auditors Role in Society

Legal Environment Affecting Audits Pt Iii Executing an Integrated Audit

Client Acceptance and Continuance and Preliminary Engagement Procedures

Audit Planning and Risk Assessment

Internal Control, Understanding the Clients Internal Control Over Financial Reporting and Auditing Design Effectiveness

Planning and Testing Operating Effectiveness of Internal Control Over Financial Reporting

Substantive Procedures and the Financial Statement Audit

Auditing Revenue Process: Sales, Billing and Collection in the Health-Care Provider and Retailing Industries

Completing the Integrated Audit and Reporting

The Acquisition and Payments Cycle and Related Accounts: Purchases, Cash Disbursements and Other Related Activities in the Automotive Industry

Auditing Human Resources Cycle Process: Personnel and Payroll in Service Industries

Auditing Inventory Processes: Tracking and Costing Products in the Land Development and Home Building Industry

Assets, Liabilities and Equity Related to the Financing Cycle

Topics Beyond the Integrated Audit

Filters