SSARS

Question 1

in a review, an accountant performs

Answer 1

inquiry and analytical procedures

Therefore, he or she would most likely inquire about actions taken by the board

Question 2

A CPA may accept an engagement to compile pro forma financial information provided

Answer 2

it is in a document that also contains or refers to the historical financial statements on which the pro forma information is based, which were compiled, reviewed, or audited.

Question 3

standard report issued by an accountant after reviewing the financial statements of a nonpublic entity should state that

Answer 3

The introductory paragraph of the review report

• identifies the financial statements reviewed, indicates that they were reviewed,
• specifies that a review consists of inquiries and analytical procedures
• that it is substantially less in scope than an audit
• no opinion is expressed

Question 4

disclaimer of opinion
adverse opinion
qualified opinion

Answer 4

only for audits.

Question 5

Statements on Standards for Accounting and Review Services (SSARS) relate to

Answer 5

financial statement preparation engagements, compilations and reviews

preparation
compilation
reviews

Question 6

he accountant is required to assess the risk of fraud in

Answer 6

audit

Question 7

An accountant is permitted to report on one financial statement so long

Answer 7

as the scope of the work is not limited.

Scope of the inquiry and analytical procedures has not been restricted

Question 8

procedures of an audit:

Answer 8

1. Observing a year-end inventory count
2. assessing internal control
3. examining subsequent cash receipts
4. development of accounting estimates

Question 9

procedures of a review:

Answer 9

1. performing analytical procedures

2. making inquiries of management (including inquiries about actions taken at board meetings)

Question 10

when fs are not in accordance to GAAP (cash basis) and its not disclosed, what should accountant do

Answer 10

should disclose the basis of accounting used in compilation report

Question 11

when fs are not in accordance to GAAP (cash basis) and it IS disclosed, what should accountant do

Answer 11

should quantify the effects of the differences between GAAP and the cash basis and disclose them in the notes of the financial statements