Question 1

A limitation of an audit is caused by

Accepted Answer

A)  the nature of financial reporting 
B)  the nature of audit procedures 
C)  the need for the audit to be conducted within a reasonable period of time and at a reasonable cost 
D)  all of the above. 
A)  the nature of financial reporting 
B)  the nature of audit procedures 
C)  the need for the audit to be conducted within a reasonable period of time and at a reasonable cost 
D)  all of the above. D

Question 2

Which of the following is not a type of opinion?

Accepted Answer

A)  qualified opinion 
B)  modified opinion 
C)  adverse opinion 
D)  disclaimer of opinion 
A)  qualified opinion 
B)  modified opinion 
C)  adverse opinion 
D)  disclaimer of opinion B

Question 3

The nature of audit procedures refers to the reliance on evidence provided by the client and its management.

Accepted Answer

A) True 
 B)False  True

Question 4

There have been a number of high profile corporate collapses in the past decade both in Australia and overseas. What role does society expect from auditors in ensuring this does not happen? What can auditors do to manage this expectation?

Accepted Answer

Society expects auditors to play a cruci

Question 5

The largest accounting firms in Australia are known collectively as the

Accepted Answer

A)  'Big-3' 
B)  'Big-4' 
C)  'Big-5' 
D)  'Big-6' 
A)  'Big-3' 
B)  'Big-4' 
C)  'Big-5' 
D)  'Big-6'

Question 6

The expectation gap is caused by:

Accepted Answer

A)  realistic auditor expectations 
B)  unrealistic user expectations 
C)  realistic user expectations 
D)  unrealistic auditor expectations 
A)  realistic auditor expectations 
B)  unrealistic user expectations 
C)  realistic user expectations 
D)  unrealistic auditor expectations

Question 7

An operational audit is an example of a compliance audit.

Accepted Answer

A) True 
 B)False

Question 8

An example of an unmodified audit opinion is:

Accepted Answer

A)  qualified audit opinion 
B)  adverse audit opinion 
C)  unqualified audit opinion with an emphasis of matter. 
D)  none of the above. 
A)  qualified audit opinion 
B)  adverse audit opinion 
C)  unqualified audit opinion with an emphasis of matter. 
D)  none of the above.

Question 9

A reasonable level of assurance is the highest level of assurance that an auditor can provide.

Accepted Answer

A) True 
 B)False

Question 10

An example of the three parties in an assurance engagement would be:

Accepted Answer

A)  audit client, employee, customer 
B)  audit client, supplier, auditor 
C)  auditor, shareholder, general public 
D)  auditor, general public, employees. 
A)  audit client, employee, customer 
B)  audit client, supplier, auditor 
C)  auditor, shareholder, general public 
D)  auditor, general public, employees.

Question 11

Which of the following regulators do not impact on the audit process?

Accepted Answer

A)  Australian Securities and Investments Commission (ASI
C)  
B)  National Institute of Accountants (NI
A)  
C)  Auditing Professional and Ethical Standards Board (APES
B)  
D)  all of the above have an impact on the audit process. 
A)  Australian Securities and Investments Commission (ASI
C)  
B)  National Institute of Accountants (NI
A)  
C)  Auditing Professional and Ethical Standards Board (APES
B)  
D)  all of the above have an impact on the audit process.

Question 12

The expectation gap is caused by unrealistic user expectations such as the auditor providing a moderate level of assurance.

Accepted Answer

A) True 
 B)False

Question 13

An auditor can provide a reasonable level of assurance on information other than historical financial information.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is ? The Accounting Professional Ethical Standards Board (APESB):

Accepted Answer

A)  standards are required to be complied with by members of each of ICAA, CPA and NIA. 
B)  issue technical standards to the members of the ICAA, CPA Australia and NIA. 
C)  follows pronouncements issued by the International Accountants Ethics Standards Board (IAES
B)  
D)  have not approved any standards that are required by law. 
A)  standards are required to be complied with by members of each of ICAA, CPA and NIA. 
B)  issue technical standards to the members of the ICAA, CPA Australia and NIA. 
C)  follows pronouncements issued by the International Accountants Ethics Standards Board (IAES
B)  
D)  have not approved any standards that are required by law.

Question 15

An audit engagement is performed by an Auditor to provide a reasonable assurance that the financial report gives a true and fair view of the business activities for the period.

Accepted Answer

A) True 
 B)False

Question 16

Under CLERP9, which of the following is not relating to specific disclosures in the directors report?

Accepted Answer

A)  details of the amount paid or payable to the company's auditor for non-audit services (each non-audit service must be listed separately along with the amount paid or payable for that service) 
B)  if the directors are satisfied that auditor independence has not been impacted by the provision of non-audit services, a statement of the directors' reasons for being satisfied. 
C)  disclosure of material transactions between auditor and entity during the period under audit. 
D)  a statement whether the directors are satisfied that the provision of non-audit services by the auditor impacts the auditor's independence 
A)  details of the amount paid or payable to the company's auditor for non-audit services (each non-audit service must be listed separately along with the amount paid or payable for that service) 
B)  if the directors are satisfied that auditor independence has not been impacted by the provision of non-audit services, a statement of the directors' reasons for being satisfied. 
C)  disclosure of material transactions between auditor and entity during the period under audit. 
D)  a statement whether the directors are satisfied that the provision of non-audit services by the auditor impacts the auditor's independence

Question 17

Which of the following is in? A government can be considered to be a user of the general purpose financial reports because:

Accepted Answer

A)  it is the basis for the calculation of taxes owed to the government 
B)  it can determine whether certain regulations have been complied with 
C)  to gain a better understanding of the entities activities 
D)  to assess the entity so that it can provide the entity with grants that will benefit society. 
A)  it is the basis for the calculation of taxes owed to the government 
B)  it can determine whether certain regulations have been complied with 
C)  to gain a better understanding of the entities activities 
D)  to assess the entity so that it can provide the entity with grants that will benefit society.

Question 18

The most common types of assurance engagements are financial report audits, confirmation audits, performance audits, comprehensive audits and assurance on corporate social responsibility (CSR) disclosures.

Accepted Answer

A) True 
 B)False

Question 19

Insurance hypothesis tells us that:

Accepted Answer

A)  investors will demand that financial reports be audited as a way of insuring against some of their loss should their investment fail. 
B)  investors can insure themselves against loss by investing in a diverse investment portfolio should an individual investment fail. 
C)  investors cannot insure themselves against loss when investing in an entity. 
D)  the entity can take out insurance to protect itself from such risks as employee or management fraud which can lead to material misstatements in the financial statements. 
A)  investors will demand that financial reports be audited as a way of insuring against some of their loss should their investment fail. 
B)  investors can insure themselves against loss by investing in a diverse investment portfolio should an individual investment fail. 
C)  investors cannot insure themselves against loss when investing in an entity. 
D)  the entity can take out insurance to protect itself from such risks as employee or management fraud which can lead to material misstatements in the financial statements.

Question 20

Only current investors (not potential investors) are considered to be users of the financial statements.

Accepted Answer

A) True 
 B)False

A limitation of an audit is caused by

Which of the following is not a type of opinion?

The nature of audit procedures refers to the reliance on evidence provided by the client and its management.

There have been a number of high profile corporate collapses in the past decade both in Australia and overseas. What role does society expect from auditors in ensuring this does not happen? What can auditors do to manage this expectation?

The largest accounting firms in Australia are known collectively as the

The expectation gap is caused by:

An operational audit is an example of a compliance audit.

An example of an unmodified audit opinion is:

A reasonable level of assurance is the highest level of assurance that an auditor can provide.

An example of the three parties in an assurance engagement would be:

Which of the following regulators do not impact on the audit process?

The expectation gap is caused by unrealistic user expectations such as the auditor providing a moderate level of assurance.

An auditor can provide a reasonable level of assurance on information other than historical financial information.

Which of the following is ? The Accounting Professional Ethical Standards Board (APESB):

An audit engagement is performed by an Auditor to provide a reasonable assurance that the financial report gives a true and fair view of the business activities for the period.

Under CLERP9, which of the following is not relating to specific disclosures in the directors report?

Which of the following is in? A government can be considered to be a user of the general purpose financial reports because:

The most common types of assurance engagements are financial report audits, confirmation audits, performance audits, comprehensive audits and assurance on corporate social responsibility (CSR) disclosures.

Insurance hypothesis tells us that:

Only current investors (not potential investors) are considered to be users of the financial statements.

Ethics, Legal Liability and Client Acceptance

Risk Assessment 1

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

Completing and Reporting on the Audit

Filters

Exam 1: Introduction and Overview of Audit and Assurance

A limitation of an audit is caused by

Which of the following is not a type of opinion?

The nature of audit procedures refers to the reliance on evidence provided by the client and its management.

There have been a number of high profile corporate collapses in the past decade both in Australia and overseas. What role does society expect from auditors in ensuring this does not happen? What can auditors do to manage this expectation?

The largest accounting firms in Australia are known collectively as the

The expectation gap is caused by:

An operational audit is an example of a compliance audit.

An example of an unmodified audit opinion is:

A reasonable level of assurance is the highest level of assurance that an auditor can provide.

An example of the three parties in an assurance engagement would be:

Which of the following regulators do not impact on the audit process?

The expectation gap is caused by unrealistic user expectations such as the auditor providing a moderate level of assurance.

An auditor can provide a reasonable level of assurance on information other than historical financial information.

Which of the following is ? The Accounting Professional Ethical Standards Board (APESB):

An audit engagement is performed by an Auditor to provide a reasonable assurance that the financial report gives a true and fair view of the business activities for the period.

Under CLERP9, which of the following is not relating to specific disclosures in the directors report?

Which of the following is in? A government can be considered to be a user of the general purpose financial reports because:

The most common types of assurance engagements are financial report audits, confirmation audits, performance audits, comprehensive audits and assurance on corporate social responsibility (CSR) disclosures.

Insurance hypothesis tells us that:

Only current investors (not potential investors) are considered to be users of the financial statements.

Ethics, Legal Liability and Client Acceptance

Risk Assessment 1

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

Completing and Reporting on the Audit

Filters