A1 to A6 Questions were wrong

Question 1

M8 - Sampling part 2

In what scenario is classical variable sampling best used?

Answer 1

Its best use to determine the inventory quantity on hand to for an inventory physical count.

Question 2

M6 - Procedures to obtain evidence

When analytical procedures yield unexpected relationships and auditor should perform what type of substantive procedures?

Answer 2

Test of details

Question 3

M8 Sampling part 2

What factor would influence the sample size of a substantive test of details?

Answer 3

1. Expected amount of misstatements
2. Measure of tolerable misstatements

Question 4

M2 Understanding the control environment and business processes

What is the primary objective of data security controls?

Answer 4

Ensure that storage media are only accesses, changed or deleted after appropriate authorization. The objective is to protect information.

Question 5

M7 Materiality

What would be a good source and starting point to calculate preliminary materiality?

Answer 5

The use of the Company’s prior years financial statements.

Question 6

M7 Materiality

In planning the audit the auditor should consider materiality of the the financial statement as whole in terms?

Answer 6

The smallest aggregate level of misstatement that could be considered material to any one of the financial statements.

Question 7

M9 Subsequent events

What are some examples of subsequent events procedures?

Answer 7

1. Review post balance transactions
2. Review management representation letter
3. Make inquiries of management regarding any unusual adjustments prior to the balance sheet date.
4. Review of minutes of Stockholders meetings
5. Examine the latest interim financial statements