Question 1

Management's responsibilitifor the financial statements do not include which of the following?

Accepted Answer

A)  selecting and applying appropriate accounting policies 
B)  expressing an opinion on the financial statements 
C)  establishing and maintaining internal controls 
D)  making reasonable accounting estimates 
A)  selecting and applying appropriate accounting policies 
B)  expressing an opinion on the financial statements 
C)  establishing and maintaining internal controls 
D)  making reasonable accounting estimates B

Question 2

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

Accepted Answer

A)  the client's compliance with contractual requirements of operating or other agreements 
B)  key ratios monitored by analysts or other key users of the financial statements 
C)  both a and b 
D)  none of the above 
A)  the client's compliance with contractual requirements of operating or other agreements 
B)  key ratios monitored by analysts or other key users of the financial statements 
C)  both a and b 
D)  none of the above C

Question 3

Procedurused by an auditor when conducting a subsequent events review include:

Accepted Answer

A)  assessing continued compliance with borrowing limits and loan covenants. 
B)  enquiring of those charged with governance as to whether any subsequent events have occurred that may affect the financial statements. 
C)  reading minutes of the meetings of the board of directors. 
D)  all of the above. 
A)  assessing continued compliance with borrowing limits and loan covenants. 
B)  enquiring of those charged with governance as to whether any subsequent events have occurred that may affect the financial statements. 
C)  reading minutes of the meetings of the board of directors. 
D)  all of the above. D

Question 4

Explain the difference between management's and the auditor's responsibility for the financial statements.

Accepted Answer

Management's responsibility includes est

Question 5

Explain the potential threats to independence relating to audit feand how an auditor can safeguard against these threats. CASE

Accepted Answer

Potential threats to independence in aud

Question 6

Indicate whether you agree or disagree with the following statements and explain your reasoning.
a) Steven Bischoff, the senior auditor at Martineau, Hellman and Nathan made the following statement to his audit team: "What constitutes sufficient appropriate audit evidence is a matter of judgment."
b) Metropolitan Poultry Company operates as a specialty food distributor. Gordon Atkins, auditor, has told his staff that the bankruptcy of a customer at year-end should not be considered a type 1 event.
c) Mississauga Ice Pucks auditor Dave Ganesh found an omission of a disclosure in the financial statements of the hockey team. He called this an error.
d) Stacey Kurvers was told by the client that a limitation in the scope of his work would require a modification to the audit report.

Accepted Answer

a) Agree. What constitutes sufficient ap

Question 7

When Paul Sliz was reviewing existing or possible obligations on the balance sheet, he was told that the outcome for these obligations was uncertain and that the company was awaiting a future event. Paul Sliz was reviewing

Accepted Answer

A)  accruals. 
B)  going concern. 
C)  materiality. 
D)  contingent liabilities. 
A)  accruals. 
B)  going concern. 
C)  materiality. 
D)  contingent liabilities.

Question 8

Which of the following are areas normally covered during the wrap-up of an audit engagement?

Accepted Answer

A)  Perform subsequent events procedures. 
B)  Consider the amount used for materiality. 
C)  Reconsider the assessments of internal control at the entity level and the risk of fraud. 
D)  All of the above. 
A)  Perform subsequent events procedures. 
B)  Consider the amount used for materiality. 
C)  Reconsider the assessments of internal control at the entity level and the risk of fraud. 
D)  All of the above.

Question 9

At year-end MarisAlbion sent out accounts receivable confirmations. One of the major customers of her client confirmed that they would not be able to pay off the receivable. The client subsequently went bankrupt and an aggrieved shareholder of Marissa's client sued her firm. What type of subsequent event was this?

Accepted Answer

A)  Type 1 
B)  Type 2 
C)  Type 1 and 2 
D)  this was not a subsequent event 
A)  Type 1 
B)  Type 2 
C)  Type 1 and 2 
D)  this was not a subsequent event

Question 10

Under the going concern assumption:

Accepted Answer

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

Question 11

Discuss the factors that are relevant when management is assessing the going concern assumption.

Accepted Answer

The following factors are relevant when

Question 12

Explain why the global financial crisis has resulted in the number of potential and actual legal liability insurance claims and explain how auditors can deal with the risk of litigation in tough economic times.

Accepted Answer

The global financial crisis has resulted

Question 13

A subsequent event occurs:

Accepted Answer

A)  before the end of the financial year. 
B)  between the client's financial year-end and the date of the auditor's report. 
C)  after the auditor completes the tests of controls. 
D)  after the auditor signs the audit engagement letter. 
A)  before the end of the financial year. 
B)  between the client's financial year-end and the date of the auditor's report. 
C)  after the auditor completes the tests of controls. 
D)  after the auditor signs the audit engagement letter.

Question 14

Those charged with governance are accountable for ensuring that the entity achievits objectivwith regard to which of the following?

Accepted Answer

A)  compliance with applicable laws 
B)  the reliability of financial reporting 
C)  both a and b 
D)  none of the above 
A)  compliance with applicable laws 
B)  the reliability of financial reporting 
C)  both a and b 
D)  none of the above

Question 15

An auditor may prepare or provide an opinion on information other than general purpose financial statement information, on all the following engagements except:

Accepted Answer

A)  reports prepared in accordance with a special purpose framework. 
B)  reports on the component of the financial statements. 
C)  reports on the expected market value of the shares price for the following five years. 
D)  reports on compliance with contractual agreements. 
A)  reports prepared in accordance with a special purpose framework. 
B)  reports on the component of the financial statements. 
C)  reports on the expected market value of the shares price for the following five years. 
D)  reports on compliance with contractual agreements.

Question 16

A limitation on the scope of the auditor's work could result from an inability to perform proceduror an imposition by the entity.

Accepted Answer

A) True 
 B)False

Question 17

Generally, the further into the future an event is likely to take place, the greater the uncertainty surrounding the event.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following factors is not relevant when management is assessing the going concern assumption?

Accepted Answer

A)  whether the auditor specializes in the client's industry 
B)  the time into the future that an event is likely to take place 
C)  the nature and condition of the entity's business 
D)  the size and complexity of the entity 
A)  whether the auditor specializes in the client's industry 
B)  the time into the future that an event is likely to take place 
C)  the nature and condition of the entity's business 
D)  the size and complexity of the entity

Question 19

Which of the following are included in the main components of the auditor's report?

Accepted Answer

A)  management's responsibility for the financial statements 
B)  the auditor's opinion on whether the financial statements are fairly presented 
C)  the date of the audit report 
D)  all of the above 
A)  management's responsibility for the financial statements 
B)  the auditor's opinion on whether the financial statements are fairly presented 
C)  the date of the audit report 
D)  all of the above

Question 20

Ron Nucci is trying to gather sufficient appropriate evidence. Which of these are factors to consider in evaluating the sufficiency and appropriateness of audit evidence?

Accepted Answer

A)  audit risk 
B)  control risk 
C)  quality of information obtained 
D)  none of the above 
A)  audit risk 
B)  control risk 
C)  quality of information obtained 
D)  none of the above

Management's responsibilitifor the financial statements do not include which of the following?

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

Procedurused by an auditor when conducting a subsequent events review include:

Explain the difference between management's and the auditor's responsibility for the financial statements.

Explain the potential threats to independence relating to audit feand how an auditor can safeguard against these threats. CASE

When Paul Sliz was reviewing existing or possible obligations on the balance sheet, he was told that the outcome for these obligations was uncertain and that the company was awaiting a future event. Paul Sliz was reviewing

Which of the following are areas normally covered during the wrap-up of an audit engagement?

Under the going concern assumption:

Discuss the factors that are relevant when management is assessing the going concern assumption.

Explain why the global financial crisis has resulted in the number of potential and actual legal liability insurance claims and explain how auditors can deal with the risk of litigation in tough economic times.

A subsequent event occurs:

Those charged with governance are accountable for ensuring that the entity achievits objectivwith regard to which of the following?

An auditor may prepare or provide an opinion on information other than general purpose financial statement information, on all the following engagements except:

A limitation on the scope of the auditor's work could result from an inability to perform proceduror an imposition by the entity.

Generally, the further into the future an event is likely to take place, the greater the uncertainty surrounding the event.

Which of the following factors is not relevant when management is assessing the going concern assumption?

Which of the following are included in the main components of the auditor's report?

Ron Nucci is trying to gather sufficient appropriate evidence. Which of these are factors to consider in evaluating the sufficiency and appropriateness of audit evidence?

Introduction and Review of Audit and Assurance

Ethics, Legal Liability and Client Acceptance

Audit Planning I

Audit Planning II

Audit Evidence

Sampling and Overview of the Risk Response Phase of the Audit

Understanding and Testing the Clients System of Internal Controls

Execution of the Audit Performing Substantive Procedur

Auditing Saland Receivabl

Auditing Purchases, Payabland Payroll

Auditing Inventoriand PPE

Auditing Cash and Investments

Filters

Exam 13: Completing and Reporting on the Audit

Management's responsibilitifor the financial statements do not include which of the following?

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

Procedurused by an auditor when conducting a subsequent events review include:

Explain the difference between management's and the auditor's responsibility for the financial statements.

Explain the potential threats to independence relating to audit feand how an auditor can safeguard against these threats. CASE

When Paul Sliz was reviewing existing or possible obligations on the balance sheet, he was told that the outcome for these obligations was uncertain and that the company was awaiting a future event. Paul Sliz was reviewing

Which of the following are areas normally covered during the wrap-up of an audit engagement?

Under the going concern assumption:

Discuss the factors that are relevant when management is assessing the going concern assumption.

Explain why the global financial crisis has resulted in the number of potential and actual legal liability insurance claims and explain how auditors can deal with the risk of litigation in tough economic times.

A subsequent event occurs:

Those charged with governance are accountable for ensuring that the entity achievits objectivwith regard to which of the following?

An auditor may prepare or provide an opinion on information other than general purpose financial statement information, on all the following engagements except:

A limitation on the scope of the auditor's work could result from an inability to perform proceduror an imposition by the entity.

Generally, the further into the future an event is likely to take place, the greater the uncertainty surrounding the event.

Which of the following factors is not relevant when management is assessing the going concern assumption?

Which of the following are included in the main components of the auditor's report?

Ron Nucci is trying to gather sufficient appropriate evidence. Which of these are factors to consider in evaluating the sufficiency and appropriateness of audit evidence?

Introduction and Review of Audit and Assurance

Ethics, Legal Liability and Client Acceptance

Audit Planning I

Audit Planning II

Audit Evidence

Sampling and Overview of the Risk Response Phase of the Audit

Understanding and Testing the Clients System of Internal Controls

Execution of the Audit Performing Substantive Procedur

Auditing Saland Receivabl

Auditing Purchases, Payabland Payroll

Auditing Inventoriand PPE

Auditing Cash and Investments

Filters