Mcq To Memorize Flashcards
According to PCAOB standard each of the following items if information should be included in the documentation of engagement quality review EXCEPT
An assessment by the engagement quality reviewer of the instances of fraud identified
Which is not correct regarding control definitiencies in in an integrated audit?
Communication of significant deficiencies and material weaknesses must include restricted language. It should NOT. Only for FS audit but not integrated audit
Section 404 of SOX of 2002
Requires attest to and report to internal control assessment made by management of issuer
When determining a number of checks (sample size) auditor should consider:
The risk if assessing control risk too low, tolerable deviation rate, expected deviation rate
To obtain evidence of control risk auditor selects from variety of techniques including
Inquiry, observation, inspection, reperformance
The objectives of audit procedures applied to segment info to provide auditor with basis for conclusion whether
The info is presented in conformity with GAAP rules on segment info
Which of the following is a correct statement about a practicioner who is engaged to exam entity’s compliance
A practicioner should assess control risk
Which of the following factors is an auditor least likely to consider when reporting on compliance of contractual agreement?
The appropriate opinion to render in the report on compliance with aspects of the contractual agreement
An auditor conducting a compliance audit will design and perform additional audit procedures in response to the assessed risk of material non-compliance. These procedures will include tests of controls if:
Tests of controls are required by the governmental audit requirements
CPA is required to comply with the provision of SSAE
Testifying expert witness in accounting and auditing matters given stipulated facts- NO
Compiling financial projection that presents a hypothetical course of action-NO
2 Assertionscfor AR
Existence be and Rights and obligations
Samples to test internal control intended to provide basis to conclude
Control activities are operating effectively
Which of the following internal control activities not perform ed in voucher payable department?
Accounting for unused prenumbered purchase order and receiving report
In a well designed internal control employee who approve PO would also
Negotiate with vendors
Under proper designed internal control the same employee would match vendors invoice, receiving report and
Recompute calculation on vendors invoice
Auditor’s purpose in reviewing credit rating of customer
Valuation and allocation
On receiving a client s bank cutoff statement, auditor most likely would trace
Prior year checks listed in the cutoff statement to the year end outstanding checklists
Walk through procedures in issuer integrated audit
Inquiry, observation, inspection of relevant documentation and reperformance of controls
Which procedures Auditor perform to determine that an interest rate swap contract is properly stated at fair value in BS
Testing the data used to arrive at the fair value of the interest rate swap contract
When auditor increases assessed level of control risk because some controls are ineffective, auditor most likely increase
Extent level of test of details
Purpose of reviewing renewal of note payable shortly after BS date
Understandability and classification
Key control to ensure sales properly authorized
Sales orders are sent to the credit department for approval
An auditor would be most likely to identify contingent liability by obtaining
Standard bank confirmation
Sound internal control dictates that immediately upon receiving checks from customer by mail, a responsible employee shoud
Prepare a dublicate listing of checks received
