Question 1

The Standards of the PCAOB can be broken up into three categories,i.e.,general,fieldwork,and reporting.Which of the following is considered in the fieldwork standards?

Accepted Answer

A) Independence. 
B) GAAP. 
C) Internal control. 
D) Disclosure.

Question 2

What does business risk include?

Accepted Answer

A) Economic factors. 
B) Competitive factors. 
C) Regulatory risk. 
D) All of the above.

Question 3

What are the PCAOB standards that present guidance in testing assertions and planning for the audit are known as?

Accepted Answer

A) General standards. 
B) Fieldwork standards. 
C) Reporting standards. 
D) None of the above.

Question 4

Which of the following is not a planning procedure performed to develop an audit program?

Accepted Answer

A) Determination of client company risks. 
B) Determination of the audit opinion that will be rendered. 
C) Development of a preliminary understanding of the quality of the client's internal control. 
D) Anticipation of audit adjustments that will be required.

Question 5

The PCAOB does not currently have a mandate for convergence with other auditing standards.

Accepted Answer

A) True 
 B)False

Question 6

Assertions about existence address whether assets and liabilities exist and assertions about occurrence address whether recorded transactions,such as sales transactions,have occurred

Accepted Answer

A) True 
 B)False

Question 7

Auditors are responsible for having the appropriate competence and capabilities to perform the audit,should comply with ethical requirements,and maintain professional skepticism throughout the audit.

Accepted Answer

A) True 
 B)False

Question 8

Control risk refers to the risk that a misstatement could occur in an assertion about a class of transaction,account balance,or disclosure and that could be material,either individually or when aggregated with other misstatements,will not be prevented,or detected and corrected,on a timely basis by the entity's internal control.

Accepted Answer

A) True 
 B)False

Question 9

PCAOB Assertions Discuss the five management financial statement assertions identified in the PCAOB Standards.Provide examples.

Accepted Answer

The answer of PCAOB Assertions Discuss the five management financial...

Question 10

Planning is not required in an audit as long as an audit program has been developed.

Accepted Answer

A) True 
 B)False

Question 11

How many auditing standards has the PCAOB issued?

Accepted Answer

A) 7. 
B) 16. 
C) 22. 
D) 5.

Question 12

The AICPA includes which of the following categories that guide the conduct of an audit?

Accepted Answer

A) Purpose of an audit and premise upon which an audit is conducted. 
B) Responsibilities. 
C) Performance. 
D) All of the above.

Question 13

The purpose of the audit program is to list the audit procedures to be followed in gathering audit evidence and to help those in charge of the audit to monitor the progress and supervise the work.

Accepted Answer

A) True 
 B)False

Question 14

The Public Company Accounting Oversight Board obtains its authority to set audit standards for public companies from the U.S.Congress.

Accepted Answer

A) True 
 B)False

Question 15

The reporting standard of the PCAOB includes consistency,disclosure,and due professional care.

Accepted Answer

A) True 
 B)False

Question 16

Which one of the following is a reporting standard requirement?

Accepted Answer

A) The auditor will state explicitly whether the financial statements are fairly presented in accordance with the applicable financial reporting framework. 
B) The auditor will identify in the auditor's report,those circumstances in which auditing principles have not been consistently observed in the current period in comparison to the preceding period. 
C) The auditor will review adjusting journal entries for accuracy,and if the auditor concludes those entries are not reasonable accurate,the auditor must so state in the auditor's report. 
D) The auditor will express an unqualified opinion on the financial statements,or will conduct additional audit procedures until such an opinion can be expressed.

Question 17

Which document is used by auditors to formally accept a new client?

Accepted Answer

A) Management representation letter. 
B) Audit Report. 
C) Engagement Letter. 
D) Audit Contract.

Question 18

The standards of the PCAOB consist of seven principles.

Accepted Answer

A) True 
 B)False

Question 19

Which auditing standards apply to private companies?

Accepted Answer

A) The AICPA Standards. 
B) The IASSB Standards. 
C) The Standards of the PCAOB. 
D) All of the above.

Question 20

A component of the reporting standards is the requirement that an opinion always be rendered on the subject matter.

Accepted Answer

A) True 
 B)False

Exam 5: Professional Auditing Standards and the Audit Opinion Formulation Process

The Standards of the PCAOB can be broken up into three categories,i.e.,general,fieldwork,and reporting.Which of the following is considered in the fieldwork standards?

What does business risk include?

What are the PCAOB standards that present guidance in testing assertions and planning for the audit are known as?

Which of the following is not a planning procedure performed to develop an audit program?

The PCAOB does not currently have a mandate for convergence with other auditing standards.

Assertions about existence address whether assets and liabilities exist and assertions about occurrence address whether recorded transactions,such as sales transactions,have occurred

Auditors are responsible for having the appropriate competence and capabilities to perform the audit,should comply with ethical requirements,and maintain professional skepticism throughout the audit.

PCAOB Assertions Discuss the five management financial statement assertions identified in the PCAOB Standards.Provide examples.

Planning is not required in an audit as long as an audit program has been developed.

How many auditing standards has the PCAOB issued?

The AICPA includes which of the following categories that guide the conduct of an audit?

The purpose of the audit program is to list the audit procedures to be followed in gathering audit evidence and to help those in charge of the audit to monitor the progress and supervise the work.

The Public Company Accounting Oversight Board obtains its authority to set audit standards for public companies from the U.S.Congress.

The reporting standard of the PCAOB includes consistency,disclosure,and due professional care.

Which one of the following is a reporting standard requirement?

Which document is used by auditors to formally accept a new client?

The standards of the PCAOB consist of seven principles.

Which auditing standards apply to private companies?

A component of the reporting standards is the requirement that an opinion always be rendered on the subject matter.