Deck 1

Question 1

nonissuer auditor must conduct an audit in accordance with ___ Standards; they MAY choose to follow PCAOB standards as well.

Issuers must conduct using _____ standards

Answer 1

ASB; PCAOB

Question 2

Which opinion(S) can you use if material, but not pervasive?

Answer 2

QUALIFIED (both F/S issue and audit issue)

Question 3

Which opinion(S) can you use if material and pervasive?

Answer 3

ADVERSE (F/S issue, departurefrom GAAP) or DISCLAIMER OF OPINION (AUDIT issue, scope limitation)

Question 4

Which section in the auditor report includes: the nature of the engagement (ex: audit), the F/S covered in the (audit) engagement, the name of entity whose F/S have been audited, the dates covered by each F/S, F/S conformity with GAAP, the applicable financial reporting framework and its origin

Answer 4

OPINION SECTION

Question 5

Which section of the auditor’s report includes: references GAAS, references PCAOB for issuers, auditor independence, and states whether or not the auditor believes sufficient appropriate evidence was obtained to provide a basis for the auditor’s opinion

Answer 5

BASIS FOR OPINION SECTION

Question 6

_______ are measures of the quality of the auditor’s performance, and guide the auditor in the performance of a properly planned and executed audit.

Answer 6

GAAS

Question 7

What is the difference between emphasis-of-matter paragraphs and other-matter paragraphs?

Answer 7

Emphasis-of-matter relates to matters disclosed in F/S
other matter paragraphs DO NOT relate to matters disclosed in F/S

Question 8

Which section in the auditor’s report would the auditor refer to a justified lack of consistency caused by a material change in GAAP between periods?

Answer 8

EMPHASIS-OF-MATTER PARAGRAPH

Question 9

an emphasis-of-matter paragraph is required when there is a justified change in accounting principle that has a immaterial effect on the entity’s F/S (T/F)

Answer 9

FALSE; MUST HAVE MATERIAL EFFECT

Question 10

the period between the date of the F/S and the date of the auditor’s report is the subsequent period where the auditor is responsible for investigating certain subsequent events (T/F)

Answer 10

TRUE

Question 11

When a subsequent event occurs after the report date, who may issue revised F/S?

Answer 11

MGMT; the auditor would request that MGMT disclose the newly discovered info AFTER determining whether there are persons relying on the info

Question 12

Supplementary Information is the responsibility of ____

Answer 12

MGMT

Question 13

the auditor does have to express an opinion in a separate section called “Required Supplementary Information” (T/F)

Answer 13

FALSE - the auditor does NOT have to express an opinion. They can CHOOSE to apply auditing procedures

Question 14

An auditor’s responsibility for supplementary information that is outside the basic F/S but required by GAAP/FASB, the auditor should apply certain _____ procedures to the supplementary information and add a separate section with the heading ______

Answer 14

LIMITED; REQUIRED SUPPLEMENTARY INFORMATION. (they do not need to audit)

Question 15

What do the following represent: tax basis, contractual basis, cash basis, a basis prescribed by a regulatory agency?

Answer 15

SPECIAL PURPOSE FRAMEWORKS

Question 16

____ is considered a general purpose framework because the standards meet the needs of a wide range of users

Answer 16

IFRS/GAAP

Question 17

the ______ auditor will allow a review of audit documentation related to planning, risk assessment, audit procedures, audit results, and matters of continuing audit significance (documentation concerning contingencies and internal controls)

Answer 17

PREDECESSOR

Question 18

What does the following correlate to?

Human Resources
Engagement/client acceptance and continuance
Leadership Responsibilities
Performance of the engagement
Monitoring
Ethical Requirements

Answer 18

CPA FIRM’s QUALITY CONTROL

“When a CPA firm wants to maintain high quality, it must be able to ‘HELP ME’ do good work.” / “HELP ME means the firm helps me hire, lead, perform, monitor, and stay ethical.”

Question 19

the engagement team members are NOT responsible for performing quality control review for an engagement partner. the quality control review should be OBJECTIVE and the reviewers could consist of another member (or members) of the firm OR a qualified external person (or team). the reviewers should NEVER include a member of the engagement team (T/F)

Answer 19

TRUE

Question 20

audit documentation must be retained for __ yrs under PCAOB Standards/issuers/sarbanes Oxley Act of 2002; __ yrs for nonissuers

Answer 20

7 for issuers; 5 for nonissuers

Question 21

a nonissuer auditor should complete the assembly of the audit file withing __ days following the report release date under auditing standards / an issuer auditor should complete the assembly of the audit file within __ days under PCAOB standards

Answer 21

60 days for nonissuers; 14 days for issuers

Question 22

_____________ is where the client asserts that all material matters have been adequately disclosed to the auditor

Answer 22

MGMT REPRESENTATION LETTER

Question 23

An auditor would add an _______ paragraph when current period financial statements are audited and presented in comparative form with compiled or reviewed financial statements from the prior period or in comparative form with prior period financial statements that were not audited, reviewed, or compiled.

Answer 23

OTHER-MATTER PARAGRAPH

Question 24

The three categories of entity objectives include the reliability of financial reporting, the effectiveness and efficiency of operations, and _________ with laws and regulations.

Answer 24

COMPLIANCE

Question 25

The documentation completion date (and not the report release date) is defined as the date after which existing documentation must not be deleted, and additions to the documentation file must be documented as such. (T/F)

Answer 25

TRUE