Question 1

What is the scope of applicability of the auditing standards of the AICPA?

Accepted Answer

A) Nonpublic companies traded in non-U.S.markets. 
B) Nonpublic companies in the U.S. 
C) Public companies traded in non-U.S.markets. 
D) Public companies traded in the U.S.

Question 2

Assertions are relevant to the audit process because they are the representations of management embodied in the financial statements.

Accepted Answer

A) True 
 B)False

Question 3

What are the AICPA's fundamental principles?

Accepted Answer

The answer of What are the AICPA's fundamental principles?...

Question 4

Which of the following is not required under the general standards of GAAS?

Accepted Answer

A) Technical training of the professionals. 
B) Independence of the auditor in fact and appearance. 
C) Conduct of an audit with the skill and care of a professional. 
D) Review of the all of work and audit documentation of the audit staff. 
E) None of the above are required.

Question 5

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

Accepted Answer

A) Consistency in the application of accounting principles. 
B) Sufficient appropriate evidence. 
C) Internal control. 
D) Planning and supervision.

Question 6

Auditing standards requires technical knowledge in auditing but not in the client's business.

Accepted Answer

A) True 
 B)False

Question 7

The proper supervision of audit assistants is a requirement of which of the Generally Accepted Auditing Standards?

Accepted Answer

A) General Standards. 
B) Standards of Fieldwork. 
C) Standards of Reporting. 
D) Standards of Quality Control. 
E) None of the above.

Question 8

The auditing standards issued by the PCAOB are identical to the auditing standards issued by the AICPA.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is a use of audit documentation?

Accepted Answer

A) Assisting the engagement team in planning and performing the audit. 
B) Assisting members of the engagement team responsible for supervising and reviewing the audit work. 
C) Retaining a record of matters of continuing significance to future audits of the same organization. 
D) All of the above.

Question 10

The auditing standards Under the clarified auditing standards,what is the structure of each auditing standard issued by the ASB? What is the purpose of each section?

Accepted Answer

The answer of The auditing standards Under the clarified auditing...

Question 11

Physically examining a client's assets is an audit procedure.

Accepted Answer

A) True 
 B)False

Question 12

The first general standard of the PCAOB requires that an audit be performed by which type of person?

Accepted Answer

A) An auditor with seasoned judgment in varying degrees of supervision and review. 
B) An auditor with appropriate technical training and proficiency. 
C) An auditor with adequate knowledge of the standards of field work and reporting. 
D) An auditor satisfying the independence standards.

Question 13

The Generally Accepted Auditing Standards represent the minimum standards for performing an audit.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following factors suggest that control risk should be assessed at a low level?

Accepted Answer

A) A lack of segregation of duties. 
B) A lack of approval for significant transactions. 
C) A competent objective internal auditor. 
D) Both A and C.

Question 15

Audit firms use close supervision and review of audit work to ensure that audits are conducted with due professional care.

Accepted Answer

A) True 
 B)False

Question 16

Which one of the following organizations provides auditing standards for public companies?

Accepted Answer

A) GAO. 
B) AICPA. 
C) GAAP. 
D) PCAOB.

Question 17

The process of understanding the client includes the preparation of the audit program.

Accepted Answer

A) True 
 B)False

Question 18

Presentation and disclosure assertions imply that all transactions and balances are properly presented,disclosures represent what actually happened,and the footnote disclosures are appropriate and adequate.

Accepted Answer

A) True 
 B)False

Question 19

The Public Company Accounting Oversight Board (PCAOB)does not set specific standards for audits of public companies.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following statements about the AICPA is true?

Accepted Answer

A) The AIPCA is historically self-regulated. 
B) The AIPCA is regulated by the federal government. 
C) The AIPCA is regulated the state governments. 
D) The AIPCA is a new organization established by an act of congress in 2002.

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

What is the scope of applicability of the auditing standards of the AICPA?

Assertions are relevant to the audit process because they are the representations of management embodied in the financial statements.

What are the AICPA's fundamental principles?

Which of the following is not required under the general standards of GAAS?

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

Auditing standards requires technical knowledge in auditing but not in the client's business.

The proper supervision of audit assistants is a requirement of which of the Generally Accepted Auditing Standards?

The auditing standards issued by the PCAOB are identical to the auditing standards issued by the AICPA.

Which of the following is a use of audit documentation?

The auditing standards Under the clarified auditing standards,what is the structure of each auditing standard issued by the ASB? What is the purpose of each section?

Physically examining a client's assets is an audit procedure.

The first general standard of the PCAOB requires that an audit be performed by which type of person?

The Generally Accepted Auditing Standards represent the minimum standards for performing an audit.

Which of the following factors suggest that control risk should be assessed at a low level?

Audit firms use close supervision and review of audit work to ensure that audits are conducted with due professional care.

Which one of the following organizations provides auditing standards for public companies?

The process of understanding the client includes the preparation of the audit program.

Presentation and disclosure assertions imply that all transactions and balances are properly presented,disclosures represent what actually happened,and the footnote disclosures are appropriate and adequate.

The Public Company Accounting Oversight Board (PCAOB)does not set specific standards for audits of public companies.

Which of the following statements about the AICPA is true?