Exam 5: Audit Evidence and Documentation

Analytical procedures are required at the risk assessment stage and as:

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

An unexpected economic downturn is likely to have which effect on inventory turnover.

When the risk of material misstatement for an account is high, the auditors may perform additional substantive procedures to restrict detection risk to a lower level.

The auditors must obtain written client representations that normally should be signed by:

Assertions with high inherent risk are least likely to involve:

The components of the risk of misstatement are: Inherent Control Detection Risk Risk Risk A. Yes Yes Yes B. Yes Yes No C. Yes No No D. No Yes Yes

In general, which of the following statements is correct with respect to ownership, possession, or access to working papers prepared by a CPA firm in connection with an audit?

Which of the following best describes the problem with the use of published industry averages for analytical procedures?

An auditor plans to apply substantive tests to the details of asset and liability accounts as of an interim date rather than as of the balance sheet date. The auditor should be aware that this practice

An auditor is performing an analytical procedure that involves comparing a client's ratios with other companies in the same industry. This technique is referred to as:

An example of an analytical procedure is the comparison of:

The audit time budget is an example of:

Which of the following statements relating to audit evidence is the most accurate statement?

The most reliable form of documentary evidence generally is considered to be documents created by the client.

During an audit engagement pertinent data are prepared and included in the audit working papers. The working papers primarily are considered to be:

The auditors use analytical procedures during the course of an audit. The most important phase of performing these procedures is the:

Which of the following is not a basic procedure used in an audit?

Which of the following is most consistent with an increase in the ratio of debt to equity?

An independent auditor finds that the Simmer Corporation occupies office space, at no charge, in an office building owned by a shareholder. This finding indicates the existence of: