Homework Help please see attached Question 1 (1.6 points) Which of the following procedures ordinarily should be applied when an independent auditor conduc

Homework Help please see attached Question 1 (1.6 points)
Which of the following procedures ordinarily should be applied when an independent auditor conduc

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Question 1 (1.6 points)

Which of the following procedures ordinarily should be applied when an independent auditor conducts a review of interim financial information of an issuer?

Question 1 options:

A) 

Verify changes in key account balances

B) 

Perform cutoff tests for cash receipts and disbursements.

C) 

Read the minutes of the board of directors’ meetings.

D) 

2Inspect the open purchase order file.

Question 2 (1.6 points)

 

The criteria used to measure an audit’s effectiveness is/are:

Question 2 options:

A) 

whether the auditor turned out to be correct

B) 

the level of audit risk presented by the audit

C) 

generally accepted accounting principles

D) 

generally accepted auditing standards 

Question 3 (1.6 points)

 

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Reporting standards for financial audits under Government Auditing Standards differ from reporting standards under generally accepted auditing standards in that Government Auditing Standards require the auditor to

Question 3 options:

A) 

Provide positive assurance that the entity’s audit committee is adequately informed about the effects of any noncompliance with laws, regulations, contracts, and grants.

B) 

Present the results of the auditor’s tests of economy and efficiency regarding the use of the entity’s resources.

C) 

Provide negative assurance that the auditor discovered no instances of noncompliance with laws, regulations, contracts, and grants

D) 

Describe the scope of the auditor’s tests of compliance with laws, regulations, contracts, and grants.


Question 4 (1.6 points)

 

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According to an additional requirement in Government Auditing Standards, the elements of a finding for a financial audit include

Question 4 options:

A) 

Condition, cause, and effect.

B) 

Criteria, condition, and an opinion.

C) 

Condition, effect, and an opinion.

D) 

Criteria, report distribution, and an opinion.



Question 5 (1.6 points)

 

Which of the following would not be a required confirmation of management responsibility when addressing fraud in the management representation letter?

Question 5 options:

A) 

To disclose to the auditor any knowledge or suspicion of fraud involving management.

B) 

To design, implement, and maintain a system of internal controls designed to prevent and detect fraud.

C) 

To report any significant fraud to the appropriate authorities.

D) 

To disclose to the auditor the results of management’s assessment of the risk that the financial statements may be materially misstated due to fraud.



Question 6 (1.6 points)

 

 Inherent risk:

Question 6 options:

A) 

 is directly affected by the acceptable level of audit risk

B) 

may be lowered if the auditor raises the tolerable detection risk

C) 

is the risk the financial statements might contain material misstatements or omissions

D) 

is directly affected by the internal controls



Question 7 (1.6 points)

 

The auditor’s primary responsibility is:

Question 7 options:

A) 

to prepare the financial statements

B) 

to attest to the fairness of the financial statements

C) 

to issue the financial statements

D) 

to attest to the correctness of the financial statements



Question 8 (1.6 points)

 

Which of the following services is an attest engagement?

Question 8 options:

A) 

An examination of internal controls.

B) 

A review of prospective financial information.

C) 

A compilation engagement where the accountant lacks independence.

D) 

A preparation engagement.

Question 9 (1.6 points)

 

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Which of the following bodies issues standards for audits of recipients of federal awards?

Question 9 options:

A) 

Financial Accounting Standards Board.

B) 

Government Accountability Office.

C) 

Governmental Accounting Standards Board.

D) 

Governmental Auditing Standards Board.



Question 10 (1.6 points)

 

Each of the following is an ethical principle that should guide the work of auditors in the conduct of audits under government auditing standards, except

Question 10 options:

A) 

Poper use of Government information 

B) 

The public interest.

C) 

Integrity 

D) 

Materiality



Question 11 (1.6 points)

 

According to Statements on Standards for Accounting and Review Engagements, in which of the following situations would the accountant be required to issue a report?

Question 11 options:

A) 

An accountant compiles financial statements that are reasonably expected to be used by a third party.

B) 

An accountant withdraws from a review engagement after substantially completing all of the required work.

C) 

An accountant prepares financial statements which are expected to be presented to a bank for the purpose of obtaining a loan.

D) 

An accountant prepares an entity’s financial statements which omit substantially all GAAP disclosures.

Question 12 (1.6 points)

 

During planning, an auditor of a nonissuer should communicate which of the following to those charged with governance at an entity?

Question 12 options:

A) 

The audit does not relieve management of its responsibilities for the financial statements.

B) 

The auditor is responsible for preparing financial statements in conformity with the applicable financial reporting framework.

C) 

The auditor will express an opinion on the effectiveness of internal controls over compliance with laws and regulations.

D) 

All audit findings will be communicated in writing to those charged with governance.



Question 13 (1.6 points)

 

The accountant must do which of the following during reviews and audits, but not during a compilation:

Question 13 options:

A) 

Obtain a management representation letter.

B) 

Assist the entity in presenting accounting information.

C) 

Gain an understanding of the entity’s internal control.

D) 

Make a preliminary assessment of control risk.



Question 14 (1.6 points)

 

The financial statements are the responsibility of:

Question 14 options:

A) 

the auditor

B) 

financial statement users

C) 

the stockholders

D) 

management



Question 15 (1.6 points)

 

While conducting an audit in accordance with Government Auditing Standards (the Yellow Book), an auditor determines that fraud has been committed in one of the client’s government contracts.  The auditor reports the fraud to the client’s audit committee, which takes no action to report the fraud to appropriate parties.  To which of the following entities is the auditor required to report this situation?

Question 15 options:

A) 

The Association of Certified Fraud Examiners.

B) 

The client’s board of directors.

C) 

The counterparty to the contract.

D) 

The client’s board of directors.

Question 16 (1.6 points)

 

Accepting an engagement to examine an entity’s financial projection most likely would be appropriate if the projection were to be distributed to

Question 16 options:

A) 

Potential stockholders who request a prospectus or a registration statement.

B) 

Stockholders of record as of the report date.

C) 

Employees who work for the entity.

D) 

A group of investors with which the entity is negotiating.



Question 17 (1.6 points)

 

During a review of financial statements, an accountant decides to emphasize a matter in the review report.  Which of the following is an example of a matter that the accountant would most likely want to emphasize?

Question 17 options:

A) 

The entity has had significant tax expenses as a result of a new tax law.

B) 

The entity has had significant transactions with related parties.

C) 

The IRS has notified the entity that it intends to audit income tax returns for prior years.

D) 

Other entities in the same industry have recently changed from LIFO to FIFO.



Question 18 (1.6 points)

 

Which of the following items would be the least persuasive type of audit evidence?

Question 18 options:

A) 

A copy of a bank statement provided to the auditor by the client.

B) 

A confirmation of bank balances as of year-end received by the auditor directly from the bank.

C) 

A letter of representation signed by the client’s president and chief executive officer.

D) 

A schedule comparing an estimate of interest expense, prepared by the auditor, to the amount reported on the client’s trial balance.



Question 19 (1.6 points)

 

Reporting standards for financial audits under Government Auditing Standards (the Yellow Book) differ from reporting under generally accepted auditing standards in that Government Auditing Standards require the auditor to

Question 19 options:

A) 

Present the results of the auditor’s tests of controls.

B) 

Provide negative assurance that the auditor discovered no evidence of intentional override of internal controls.

C) 

Describe the scope of the auditor’s principal substantive tests.

D) 

Provide positive assurance that control activities regarding segregation of duties are consistent with the entity’s control objectives.



Question 20 (1.6 points)

 

Which of the following would be a consideration in planning an auditor’s sample for a test of controls?

Question 20 options:

A) 

Preliminary judgments about materiality levels.

B) 

The level of detection for the account.

C) 

The auditor’s allowable risk of assessing control risk is too low.

D) 

The auditor’s allowable risk of assessing control risk is too high.

Question 21 (1.6 points)

 

Which of the following statements describes an auditor’s obligation to identify deficiencies in the design or operation of internal control?

Question 21 options:

A) 

The auditor need not search for significant deficiencies or material weaknesses unless management requests an attestation that “no material weaknesses were noted in the audit.”

B) 

The auditor need not search for significant deficiencies and material weaknesses but should document and communicate any reportable conditions that are discovered.

C) 

The auditor should design and apply tests of controls to discover control deficiencies that could result in material misstatements.

D) 

The auditor should search for significant deficiencies and material weaknesses if the auditor expects to assess control risk at below the maximum.



Question 22 (1.6 points)

 

Which of the following audit procedures most likely would assist an auditor in identifying conditions and events that may indicate substantial doubt about an entity’s ability to continue as a going concern?

 

 

Question 22 options:

A) 

Reviewing lease agreements to determine whether leased assets should be capitalized.

B) 

Comparing the market value of property to amounts owed on the property.

C) 

Reading the minutes of meetings of the stockholders and the board of directors.

D) 

Inspecting title documents to verify whether any assets are pledged as collateral.



Question 23 (1.6 points)

 

When performing a review under SSAEs or SSARSs, the practitioner must

Question 23 options:

A) 

Confirm that the responsible party is the engaging party.

B) 

Request a written assertion from the responsible party.

C) 

Restrict the use of the report.

D) 

Be independent.



Question 24 (1.6 points)

 

When auditing an entity’s financial statements in accordance with generally accepted government auditing standards, an auditor should prepare a written report on the auditor’s

Question 24 options:

A) 

Field work and procedures that substantiated the auditor’s specific findings and conclusions.

B) 

Identification of the causes of performance problems and recommendations for actions to improve operations.

C) 

Testing of internal control.

D) 

Opinion on the entity’s attainment of the goals and objectives specified by applicable laws and regulations.



Question 25 (1.6 points)

 

Which of the following components of internal control contributes most to a strong control environment?

Question 25 options:

A) 

Management adheres to internal control policies.

B) 

Policy manuals provide a clear understanding of internal controls.

C) 

Duties are clearly defined and separated.

D) 

Controls are assessed through ongoing activities and evaluations. 



Question 26 (1.6 points)

 

SSARSs are primarily useful for the preparation, compilation, and review of financial statements

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