Question 1

Subsequent events procedures are normally performed through to and including the date of the auditor's report.

Accepted Answer

A) True 
 B)False  True

Question 2

Contraventions of the Corporations Act that are considered significant include:

Accepted Answer

A) insolvent trading. 
B) fraud by officers or employees of the entity. 
C) breaches of accounting standards. 
D) All of the above 
A) insolvent trading. 
B) fraud by officers or employees of the entity. 
C) breaches of accounting standards. 
D) All of the above D

Question 3

Material disagreements with management will result in either:

Accepted Answer

A) an adverse opinion or an unqualified opinion. 
B) a qualified opinion or adverse opinion. 
C) an emphasis of matter or adverse opinion. 
D) an unqualified opinion or a qualified opinion. 
A) an adverse opinion or an unqualified opinion. 
B) a qualified opinion or adverse opinion. 
C) an emphasis of matter or adverse opinion. 
D) an unqualified opinion or a qualified opinion. B

Question 4

An error is an intentional misstatement in the client's financial report.

Accepted Answer

A) True 
 B)False

Question 5

Explain the potential threats to independence relating to audit fees and how auditor can safeguard against these threats.

Accepted Answer

Potential threats to independence relati

Question 6

As soon as practicable,the auditor should communicate weaknesses in internal controls to management or those charged with governance.

Accepted Answer

A) True 
 B)False

Question 7

A limitation on the scope of the auditor's work may result from:

Accepted Answer

A) absence of adequate accounting records. 
B) damage to accounting records. 
C) lack of access to key personnel. 
D) all of the above. 
A) absence of adequate accounting records. 
B) damage to accounting records. 
C) lack of access to key personnel. 
D) all of the above.

Question 8

Demand for forensic accounting has grown following the collapses of Enron and Worldcom.Explain the important characteristics of forensic accountants and the main techniques they use to investigate fraud.

Accepted Answer

Forensic accountants play a crucial role

Question 9

A type 1 subsequent event provides evidence with respect to conditions that developed subsequent to year-end.

Accepted Answer

A) True 
 B)False

Question 10

Those charged with governance are accountable for ensuring that the entity achieves its objectives with regard to which of the following?

Accepted Answer

A) The reliability of financial reporting 
B) Compliance with applicable laws 
C) Both a and b 
D) None of the above 
A) The reliability of financial reporting 
B) Compliance with applicable laws 
C) Both a and b 
D) None of the above

Question 11

Which of the following statements regarding judgemental misstatements is in?

Accepted Answer

A) They are not the same as errors 
B) They are the same as errors 
C) They can arise as a result of a difference in underlying assumptions by the client and the auditor 
D) They can arise as a result of a difference in the application of judgement by the client and the auditor 
A) They are not the same as errors 
B) They are the same as errors 
C) They can arise as a result of a difference in underlying assumptions by the client and the auditor 
D) They can arise as a result of a difference in the application of judgement by the client and the auditor

Question 12

Sufficiency relates to the quality of audit evidence gathered.

Accepted Answer

A) True 
 B)False

Question 13

The final phase of an audit is to assess all of the audit evidence obtained and determine whether it is sufficient and appropriate.

Accepted Answer

A) True 
 B)False

Question 14

Matters of governance that the auditor may wish to discuss with those charged with governance include any practical difficulties encountered in performing the audit.

Accepted Answer

A) True 
 B)False

Question 15

Under the going concern assumption:

Accepted Answer

A) an entity is viewed as continuing in business for the foreseeable future. 
B) an entity is viewed as not likely to continue in operation for the foreseeable future. 
C) an entity's assets and liabilities are recorded at liquidation values. 
D) an entity is considered to be a separate legal entity from its owners. 
A) an entity is viewed as continuing in business for the foreseeable future. 
B) an entity is viewed as not likely to continue in operation for the foreseeable future. 
C) an entity's assets and liabilities are recorded at liquidation values. 
D) an entity is considered to be a separate legal entity from its owners.

Question 16

Breaches of accounting standards are not considered to be significant contraventions of the Corporations Act.

Accepted Answer

A) True 
 B)False

Question 17

An unqualified audit report with an emphasis of matter should be issued if a subsequent event has occurred that has resulted in a new auditor's report being prepared on a revised financial report.

Accepted Answer

A) True 
 B)False

Question 18

Explain the difference between type 1 and type 2 subsequent events and provide examples of each type of event.

Accepted Answer

Type 1 subsequent events are events that

Question 19

If the auditor is not able to obtain sufficient appropriate audit evidence,the appropriate audit opinion will either be:

Accepted Answer

A) a qualified opinion or disclaimer of opinion. 
B) a qualified opinion or an unqualified opinion. 
C) a disclaimer of opinion or an emphasis of matter. 
D) an emphasis of matter or a qualified opinion. 
A) a qualified opinion or disclaimer of opinion. 
B) a qualified opinion or an unqualified opinion. 
C) a disclaimer of opinion or an emphasis of matter. 
D) an emphasis of matter or a qualified opinion.

Question 20

Which of the following are examples of qualitative considerations that may cause misstatements of quantitatively immaterial amounts to be considered material?

Accepted Answer

A) Key ratios monitored by analysts or other key users of the financial report 
B) The client's compliance with contractual requirements of operating or other agreements 
C) Both a and b 
D) None of the above 
A) Key ratios monitored by analysts or other key users of the financial report 
B) The client's compliance with contractual requirements of operating or other agreements 
C) Both a and b 
D) None of the above

Subsequent events procedures are normally performed through to and including the date of the auditor's report.

Contraventions of the Corporations Act that are considered significant include:

Material disagreements with management will result in either:

An error is an intentional misstatement in the client's financial report.

Explain the potential threats to independence relating to audit fees and how auditor can safeguard against these threats.

As soon as practicable,the auditor should communicate weaknesses in internal controls to management or those charged with governance.

A limitation on the scope of the auditor's work may result from:

Demand for forensic accounting has grown following the collapses of Enron and Worldcom.Explain the important characteristics of forensic accountants and the main techniques they use to investigate fraud.

A type 1 subsequent event provides evidence with respect to conditions that developed subsequent to year-end.

Those charged with governance are accountable for ensuring that the entity achieves its objectives with regard to which of the following?

Which of the following statements regarding judgemental misstatements is in?

Sufficiency relates to the quality of audit evidence gathered.

The final phase of an audit is to assess all of the audit evidence obtained and determine whether it is sufficient and appropriate.

Matters of governance that the auditor may wish to discuss with those charged with governance include any practical difficulties encountered in performing the audit.

Under the going concern assumption:

Breaches of accounting standards are not considered to be significant contraventions of the Corporations Act.

An unqualified audit report with an emphasis of matter should be issued if a subsequent event has occurred that has resulted in a new auditor's report being prepared on a revised financial report.

Explain the difference between type 1 and type 2 subsequent events and provide examples of each type of event.

If the auditor is not able to obtain sufficient appropriate audit evidence,the appropriate audit opinion will either be:

Which of the following are examples of qualitative considerations that may cause misstatements of quantitatively immaterial amounts to be considered material?

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

Execution of the Audit Performing Substantive Procedures

Substantive Testing and Balance Sheet Accounts

Substantive Testing and Income Statement Accounts

Filters

Exam 12: Completing and Reporting on the Audit

Subsequent events procedures are normally performed through to and including the date of the auditor's report.

Contraventions of the Corporations Act that are considered significant include:

Material disagreements with management will result in either:

An error is an intentional misstatement in the client's financial report.

Explain the potential threats to independence relating to audit fees and how auditor can safeguard against these threats.

As soon as practicable,the auditor should communicate weaknesses in internal controls to management or those charged with governance.

A limitation on the scope of the auditor's work may result from:

Demand for forensic accounting has grown following the collapses of Enron and Worldcom.Explain the important characteristics of forensic accountants and the main techniques they use to investigate fraud.

A type 1 subsequent event provides evidence with respect to conditions that developed subsequent to year-end.

Those charged with governance are accountable for ensuring that the entity achieves its objectives with regard to which of the following?

Which of the following statements regarding judgemental misstatements is in?

Sufficiency relates to the quality of audit evidence gathered.

The final phase of an audit is to assess all of the audit evidence obtained and determine whether it is sufficient and appropriate.

Matters of governance that the auditor may wish to discuss with those charged with governance include any practical difficulties encountered in performing the audit.

Under the going concern assumption:

Breaches of accounting standards are not considered to be significant contraventions of the Corporations Act.

An unqualified audit report with an emphasis of matter should be issued if a subsequent event has occurred that has resulted in a new auditor's report being prepared on a revised financial report.

Explain the difference between type 1 and type 2 subsequent events and provide examples of each type of event.

If the auditor is not able to obtain sufficient appropriate audit evidence,the appropriate audit opinion will either be:

Which of the following are examples of qualitative considerations that may cause misstatements of quantitatively immaterial amounts to be considered material?

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

Execution of the Audit Performing Substantive Procedures

Substantive Testing and Balance Sheet Accounts

Substantive Testing and Income Statement Accounts

Filters