Mock In class test

Frage 1 von 25

1

The auditor has considerable responsibility for notifying users as to whether or not the statements are properly stated. This imposes upon the auditor a duty to:

Wähle eine der folgenden:

Provide reasonable assurance that material misstatements will be detected.
Be a guarantor of the fairness in the statements.
Be equally responsible with management for the preparation of the financial statements.
Be an insurer of the fairness in the statements.

Erklärung

Frage 2 von 25

1

When dealing with laws and regulations that do not have a direct effect on the financial statements, the auditor:

Wähle eine der folgenden:

Should inquire of management about whether the entity is in compliance with such laws and regulations.
Has no responsibility to determine if any violations of these laws has occurred.
Must report all violations, including inconsequential violations, to the audit committee.
Should perform the same procedures as for violations having a direct effect on the financial statements.

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Frage 3 von 25

1

The following stages comprise a typical money laundering process. What is the right sequence of the process ?
Creating layers of financial transactions
2. Breaking up large amounts of cash into smaller sums and placing them into the financial system
3. Integrating the money into the economic system as if it is "clean" and comes from legitimate sources

Wähle eine der folgenden:

1,2 and 3
1, 3 and 2
2, 1 and 3
3, 1 and 2

Erklärung

Frage 4 von 25

1

Which of the following considerations of fraud and error by the auditor is not required by ISA 240?

Wähle eine der folgenden:

When the auditor encounters circumstances that may indicate that there is a material misstatement in the financial statements resulting from fraud or error, the auditor should inform regulatory institutions
Based on the risk assessment the auditor should design audit procedures to obtain reasonable assurance that material misstatements arising from fraud and error are detected
The auditor should be satisfied that those charged with governance have been informed of any material weaknesses in internal control related to the prevention and detection of fraud
The auditor should communicate to management any material weaknesses in internal control related to the prevention or detection of fraud and error

Erklärung

Frage 5 von 25

1

If an auditor discovers fraud, an auditor should:

Wähle eine der folgenden:

Conduct further investigations
Approach the appropriate level of management
Consider withdrawing from the audit if the fraud is significant
All of the above

Erklärung

Frage 6 von 25

1

Financial involvement with a client will affect independence and may lead a reasonable observer to conclude that independence has been impaired. Which of the following is not a form of financial involvement with a client?

Wähle eine der folgenden:

Loans to or from the client
Financial interest resulting from being an administrator of any trust with a financial interest in the client
Financial interest in a joint venture with a client
Fees paid for audit engagement

Erklärung

Frage 7 von 25

1

Which of the following matters is not ordinarily included in a management representation letter?

Wähle eine der folgenden:

Amount of potential loss from litigation, including court costs
Management's acknowledgment of its responsibility for the fair presentation of financial statements
Disclosure of compensating balances and other arrangements involving restrictions on cash balances
Plans or intentions that may affect the carrying value or classification of assets

Erklärung

Frage 8 von 25

1

Which of the following would be considered a 'self-interest threat'?

Wähle eine der folgenden:

Potential employment with an assurance client
Acting as the client's advocate in a legal proceeding
When a member of the assurance team was previously a director or officer of the assurance client
A member of the assurance team has a close family member who is a director or officer of the assurance client

Erklärung

Frage 9 von 25

1

Which of the following is not a duty of the audit committee?

Wähle eine der folgenden:

Special Investigations
Review of internal controls
Monitor the effectiveness of external auditor
Liaison with external controls

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Frage 10 von 25

1

When planning the audit, if the auditor has no reason to believe that illegal acts exist, the auditor should:

Wähle eine der folgenden:

Include audit procedures which have a strong probability of detecting illegal acts.
Still include some audit procedures designed specifically to uncover illegalities.
Ignore the issue.
Make inquiries of management regarding their policies for detecting and preventing illegal acts and regarding their knowledge of violations, and then rely on normal audit procedures to detect errors, irregularities, and illegalities

Erklärung

Frage 11 von 25

1

All of the following factors influence the continuance of an existing auditor-client relationship except:

Wähle eine der folgenden:

The balance of client fees owed
Excessive risk
Pending litigation between client and auditor
Inability to obtain a management representations letter

Erklärung

Frage 12 von 25

1

Important determinants of audit fees all of the following except:

Wähle eine der folgenden:

The size of the audit firm
The type of client - whether the auditee is an existing client or not
The size of the auditee and the geographical dispersion
The quality of the auditee's internal control system

Erklärung

Frage 13 von 25

1

Advertising and promotional material by auditors:

Wähle eine der folgenden:

Could include exact fees
Should not discredit the services offered by other firms
Could fall short of requirement of UK Advertising Standard Agency
Could be misleading either directly or by implication

Erklärung

Frage 14 von 25

1

In evaluating engagement risks, the auditor should be aware of items such as:

Wähle eine der folgenden:

The client's previous year's profits
The client's method of financing growth
The client's liquidity position
All of the above

Erklärung

Frage 15 von 25

1

Qualitative factors can affect an auditor's assessment of materiality. Which of the following statements is true?
I. Misstatements that are otherwise immaterial may be material if they affect earnings trends.
II. Misstatements that are otherwise minor may be material if there are possible consequences arising from contractual obligations.

Wähle eine der folgenden:

I only
II only
I and II
neither I nor II

Erklärung

Frage 16 von 25

1

The three main elements of risk in a business are:

Wähle eine der folgenden:

Financial risk, Operational risk; Compliance risk
Financial risk, Control, Operational risk,
Control risk, Operational risk, Compliance risk
Control risk, Financial risk, Compliance risk

Erklärung

Frage 17 von 25

1

The major limitation of using the audit risk model is the:

Wähle eine der folgenden:

Objective nature of its components
There is no limitation to the model
Application of the model
Subjective nature of its components

Erklärung

Frage 18 von 25

1

When an auditor calculates the gross margin as a percent of sales and compares it with previous periods, this type of evidence is called

Wähle eine der folgenden:

Physical examination
Analytical review
Observation
Inquiry

Erklärung

Frage 19 von 25

1

Quality control policies and procedures that are established to decide whether to accept a new client should provide the audit firm with reasonable assurance that:

Wähle eine der folgenden:

The audit firm's duty to the public concerning the acceptance of new clients is satisfied.
The likelihood of associating with clients whose management lacks integrity is minimized.
Client-prepared schedules that are necessary for the engagement are completed on a timely
Sufficient corroborating evidence to support the financial statement assertions is available.

Erklärung

Frage 20 von 25

1

Which of these issues relating to good engagement performance should be addressed in an audit firm's procedures manual

Wähle eine der folgenden:

Direction
Supervision
Review
All of the above

Erklärung

Frage 21 von 25

1

When a group auditor uses the work of a component auditor he must document:

Wähle eine der folgenden:

The professional qualifications, independence and professional competence of the other auditor
Procedures to obtain sufficient appropriate audit evidence that the work of the other auditor is adequate is all the consideration necessary
The impact of internal controls on the work of the other auditor
The audit area in which the work was performed by the other auditor

Erklärung

Frage 22 von 25

1

Procedures to obtain sufficient appropriate audit evidence that the work of the other auditor is adequate is all the consideration necessary

Wähle eine der folgenden:

A. Direction and supervision of the audit group
B. Provision of essential technical information
C. Participation in the policy making process
All of the above
A and B
A and C
B and C

Erklärung

Frage 23 von 25

1

In the context of group audit, if a component is significant due to its nature or circumstances, the auditor:

Wähle eine der folgenden:

Must carry out a full audit of the component using the component materiality
Must carry out an audit of specified account balances related to identified significant risks
Must carry out specified audit procedures related to identified significant risks
All of the above

Erklärung

Frage 24 von 25

1

What is the type of assurance engagement that has as its subject matter non-historical financial information?

Wähle eine der folgenden:

Prospective financial information
Review of financial statements
Special purpose engagement
Agreed-upon procedures

Erklärung

Frage 25 von 25

1

In an agreed-upon procedures engagement what matters generally have to be agreed between auditor and management?

Wähle eine der folgenden:

Nature, timing and extent of the specific procedures to be applied
The intended user of the report
The skills of the audit team
Identification of the corporate governance framework

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Advanced Audit Principles and Practice Mock In class test

Mock In class test

Frage 1 von 25

The auditor has considerable responsibility for notifying users as to whether or not the statements are properly stated. This imposes upon the auditor a duty to:

Wähle eine der folgenden:

Erklärung

Frage 2 von 25

When dealing with laws and regulations that do not have a direct effect on the financial statements, the auditor:

Wähle eine der folgenden:

Erklärung

Frage 3 von 25

Wähle eine der folgenden:

Erklärung

Frage 4 von 25

Which of the following considerations of fraud and error by the auditor is not required by ISA 240?

Wähle eine der folgenden:

Erklärung

Frage 5 von 25

If an auditor discovers fraud, an auditor should:

Wähle eine der folgenden:

Erklärung

Frage 6 von 25

Financial involvement with a client will affect independence and may lead a reasonable observer to conclude that independence has been impaired. Which of the following is not a form of financial involvement with a client?

Wähle eine der folgenden:

Erklärung

Frage 7 von 25

Which of the following matters is not ordinarily included in a management representation letter?

Wähle eine der folgenden:

Erklärung

Frage 8 von 25

Which of the following would be considered a 'self-interest threat'?

Wähle eine der folgenden:

Erklärung

Frage 9 von 25

Which of the following is not a duty of the audit committee?

Wähle eine der folgenden:

Erklärung

Frage 10 von 25

When planning the audit, if the auditor has no reason to believe that illegal acts exist, the auditor should:

Wähle eine der folgenden:

Erklärung

Frage 11 von 25

All of the following factors influence the continuance of an existing auditor-client relationship except:

Wähle eine der folgenden:

Erklärung

Frage 12 von 25

Important determinants of audit fees all of the following except:

Wähle eine der folgenden:

Erklärung

Frage 13 von 25

Advertising and promotional material by auditors:

Wähle eine der folgenden:

Erklärung

Frage 14 von 25

In evaluating engagement risks, the auditor should be aware of items such as:

Wähle eine der folgenden:

Erklärung

Frage 15 von 25

Wähle eine der folgenden:

Erklärung

Frage 16 von 25

The three main elements of risk in a business are:

Wähle eine der folgenden:

Erklärung

Frage 17 von 25

The major limitation of using the audit risk model is the:

Wähle eine der folgenden:

Erklärung

Frage 18 von 25

When an auditor calculates the gross margin as a percent of sales and compares it with previous periods, this type of evidence is called

Wähle eine der folgenden:

Erklärung

Frage 19 von 25

Quality control policies and procedures that are established to decide whether to accept a new client should provide the audit firm with reasonable assurance that:

Wähle eine der folgenden:

Erklärung

Frage 20 von 25

Which of these issues relating to good engagement performance should be addressed in an audit firm's procedures manual

Wähle eine der folgenden:

Erklärung