Question 1

Control risk is assessed to be low when there are no internal controls tested or relied upon by the auditor.

Accepted Answer

A) True 
 B)False  True

Question 2

Misstatements can only arise from fraud.

Accepted Answer

A) True 
 B)False  True

Question 3

Inherent risk is:

Accepted Answer

A)  assessed as high when there are no internal controls tested or relied upon by the auditor. 
B)  assessed as low when there are good internal controls in place. 
C)  the risk of a misstatement occurring irrespective of any internal controls put in place by management. 
D)  the risk that the auditor's testing procedures will not detect a material misstatement. 
A)  assessed as high when there are no internal controls tested or relied upon by the auditor. 
B)  assessed as low when there are good internal controls in place. 
C)  the risk of a misstatement occurring irrespective of any internal controls put in place by management. 
D)  the risk that the auditor's testing procedures will not detect a material misstatement. B

Question 4

Tobias Appel is trying to ensure that he can review controls over purchasing transactions. In addition he would like to substantiate the dollar amounts he is reviewing. What type of procedures can he perform that will provide evidence as to whether a control is effective as well as if an item is being recorded properly?

Accepted Answer

A)  statistical sampling 
B)  dual purpose tests 
C)  test of balances 
D)  test of controls 
A)  statistical sampling 
B)  dual purpose tests 
C)  test of balances 
D)  test of controls

Question 5

Tracing is primarily directed towards verifying which of the following assertions?

Accepted Answer

A)  completeness 
B)  existence 
C)  occurrence 
D)  valuation 
A)  completeness 
B)  existence 
C)  occurrence 
D)  valuation

Question 6

Which of the following is the first step an auditor performs when performing analytical procedures?

Accepted Answer

A)  determine appropriate procedures for investigating the reasons for differences if they are significant 
B)  draw conclusions 
C)  identify the computation, comparison or relationship to be made or investigated 
D)  assess the reliability of any data to be used 
A)  determine appropriate procedures for investigating the reasons for differences if they are significant 
B)  draw conclusions 
C)  identify the computation, comparison or relationship to be made or investigated 
D)  assess the reliability of any data to be used

Question 7

Umberto Levinson has performed a test of controls of a flower shop. He is trying to determine the timing of substantive procedures at year-end. Which factor will determine the timing of his audit procedures?

Accepted Answer

A)  timing of the year-end work 
B)  audit risk 
C)  inherent risk 
D)  control risk 
A)  timing of the year-end work 
B)  audit risk 
C)  inherent risk 
D)  control risk

Question 8

Maury Lions is ready to undertake substantive procedures at an educational institution. Which of the following factors will influence his substantive tests?

Accepted Answer

A)  the nature of the test 
B)  the type of evidence required 
C)  the complexity of the client's data capturing systems 
D)  all of the above 
A)  the nature of the test 
B)  the type of evidence required 
C)  the complexity of the client's data capturing systems 
D)  all of the above

Question 9

Which of the following is not a type of analytical procedure?

Accepted Answer

A)  confirmation analysis 
B)  ratio analysis 
C)  break-even analysis 
D)  trend analysis 
A)  confirmation analysis 
B)  ratio analysis 
C)  break-even analysis 
D)  trend analysis

Question 10

The audit program serves as the instructions for the audit team members to complete the required testing.

Accepted Answer

A) True 
 B)False

Question 11

Analytical procedures may not be useful when they are used on a company with significantly diverse operations and geographical segments.

Accepted Answer

A) True 
 B)False

Question 12

Analytical procedures that provide persuasive or corroborative evidence contribute minimal support for the audit conclusion.

Accepted Answer

A) True 
 B)False

Question 13

Fluctuations in financial data identified by the auditor when planning the audit may be caused by:

Accepted Answer

A)  dependent relationships. 
B)  seasonal patterns. 
C)  external decisions directly impacting the business. 
D)  all of the above. 
A)  dependent relationships. 
B)  seasonal patterns. 
C)  external decisions directly impacting the business. 
D)  all of the above.

Question 14

Matilda Papas has been asked to lead her audit team in the audit of the Toronto Raptors basketball team. She performed a review of their risks and found that the team's risks tend to be driven by the nature of certain significant accounts or business activities that the Raptors pursue. This risk is

Accepted Answer

A)  audit risk. 
B)  inherent risk. 
C)  control risk. 
D)  detection risk. 
A)  audit risk. 
B)  inherent risk. 
C)  control risk. 
D)  detection risk.

Question 15

Comparing sales commissions or bonuses with related sales provides what level of evidence?

Accepted Answer

A)  corroborative 
B)  absolute 
C)  minimal 
D)  persuasive 
A)  corroborative 
B)  absolute 
C)  minimal 
D)  persuasive

Question 16

The timing of substantive procedures is directly influenced by the level of control risk.

Accepted Answer

A) True 
 B)False

Question 17

Roll-forward procedures are performed:

Accepted Answer

A)  to update the audit findings from the time of the interim procedures through to year-end. 
B)  to detect fraud in various balance sheet accounts. 
C)  before the end of the financial year. 
D)  none of the above. 
A)  to update the audit findings from the time of the interim procedures through to year-end. 
B)  to detect fraud in various balance sheet accounts. 
C)  before the end of the financial year. 
D)  none of the above.

Question 18

Analytical procedures may not be used:

Accepted Answer

A)  as primary tests of an account balance. 
B)  in testing internal controls. 
C)  to provide at least some minimal level of support for the conclusion. 
D)  as corroborative tests in combination with other procedures. 
A)  as primary tests of an account balance. 
B)  in testing internal controls. 
C)  to provide at least some minimal level of support for the conclusion. 
D)  as corroborative tests in combination with other procedures.

Question 19

Using computer assisted audit techniques (CAATs) makes the audit:

Accepted Answer

A)  more comprehensive. 
B)  more expensive. 
C)  more efficient. 
D)  both a and c 
A)  more comprehensive. 
B)  more expensive. 
C)  more efficient. 
D)  both a and c

Question 20

The levels of evidence obtained when performing substantive procedures includes:

Accepted Answer

A)  minimal. 
B)  persuasive. 
C)  general. 
D)  all of the above. 
A)  minimal. 
B)  persuasive. 
C)  general. 
D)  all of the above.

Control risk is assessed to be low when there are no internal controls tested or relied upon by the auditor.

Misstatements can only arise from fraud.

Inherent risk is:

Tracing is primarily directed towards verifying which of the following assertions?

Which of the following is the first step an auditor performs when performing analytical procedures?

Umberto Levinson has performed a test of controls of a flower shop. He is trying to determine the timing of substantive procedures at year-end. Which factor will determine the timing of his audit procedures?

Maury Lions is ready to undertake substantive procedures at an educational institution. Which of the following factors will influence his substantive tests?

Which of the following is not a type of analytical procedure?

The audit program serves as the instructions for the audit team members to complete the required testing.

Analytical procedures may not be useful when they are used on a company with significantly diverse operations and geographical segments.

Analytical procedures that provide persuasive or corroborative evidence contribute minimal support for the audit conclusion.

Fluctuations in financial data identified by the auditor when planning the audit may be caused by:

Matilda Papas has been asked to lead her audit team in the audit of the Toronto Raptors basketball team. She performed a review of their risks and found that the team's risks tend to be driven by the nature of certain significant accounts or business activities that the Raptors pursue. This risk is

Comparing sales commissions or bonuses with related sales provides what level of evidence?

The timing of substantive procedures is directly influenced by the level of control risk.

Roll-forward procedures are performed:

Analytical procedures may not be used:

Using computer assisted audit techniques (CAATs) makes the audit:

The levels of evidence obtained when performing substantive procedures includes:

Introduction and Overview of Audit and Assurance

Ethics, Legal Liability and Client Acceptance

Risk Assessment I

Risk Assessment II

Audit Evidence

Gaining an Understanding of the Clients System of Internal Controls

Sampling and Overview of the Risk Response Phase of the Audit

Execution of the Audit Testing of Controls

Substantive Testing and Balance Sheet Accounts

Substantive Testing and Income Statement Accounts

Completing and Reporting on the Audit

Filters

Exam 9: Execution of the Audit Performing Substantive Procedures

Control risk is assessed to be low when there are no internal controls tested or relied upon by the auditor.

Misstatements can only arise from fraud.

Inherent risk is:

Tracing is primarily directed towards verifying which of the following assertions?

Which of the following is the first step an auditor performs when performing analytical procedures?

Umberto Levinson has performed a test of controls of a flower shop. He is trying to determine the timing of substantive procedures at year-end. Which factor will determine the timing of his audit procedures?

Maury Lions is ready to undertake substantive procedures at an educational institution. Which of the following factors will influence his substantive tests?

Which of the following is not a type of analytical procedure?

The audit program serves as the instructions for the audit team members to complete the required testing.

Analytical procedures may not be useful when they are used on a company with significantly diverse operations and geographical segments.

Analytical procedures that provide persuasive or corroborative evidence contribute minimal support for the audit conclusion.

Fluctuations in financial data identified by the auditor when planning the audit may be caused by:

Matilda Papas has been asked to lead her audit team in the audit of the Toronto Raptors basketball team. She performed a review of their risks and found that the team's risks tend to be driven by the nature of certain significant accounts or business activities that the Raptors pursue. This risk is

Comparing sales commissions or bonuses with related sales provides what level of evidence?

The timing of substantive procedures is directly influenced by the level of control risk.

Roll-forward procedures are performed:

Analytical procedures may not be used:

Using computer assisted audit techniques (CAATs) makes the audit:

The levels of evidence obtained when performing substantive procedures includes:

Introduction and Overview of Audit and Assurance

Ethics, Legal Liability and Client Acceptance

Risk Assessment I

Risk Assessment II

Audit Evidence

Gaining an Understanding of the Clients System of Internal Controls

Sampling and Overview of the Risk Response Phase of the Audit

Execution of the Audit Testing of Controls

Substantive Testing and Balance Sheet Accounts

Substantive Testing and Income Statement Accounts

Completing and Reporting on the Audit

Filters