Audit MCQs

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Which of the following conditions affects users demand for accounting information






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Business risk is the risk a company takes that






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Operational auditing refers to the study of business operations for the purpose of:






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The Office of the Auditor General of Canada reports to which of the following






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Investors of a public company will probably request audited financial statements from a public accountant because






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An example of an assurance engagement is






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The general standard of generally accepted auditing standards does not include which of the following






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An auditor must be independent in appearance and fact. Which of the following is not an aspect of practical independence?






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Which of the following is not an aspect of planning and supervision under the GAAS examination standards?






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During the audit of XYZ Co. client management informs the auditor that they have two bank accounts both with a minimal balance in them. As the auditor...






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Auditing standards require a public accountant to issue a report on the financial statements when the public accountant’s name is associated with th...






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A reservation in an audit report refers to which of the following?






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Superstar auditor meets the management of XYZ public company for the first time. XYZ would like to engage Superstar as their auditor for the upcoming ...






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An emphasis of a matter paragraph is an extra paragraph in what type of audit report?






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An auditor discovers that ABC Company is not following GAAP in the accounting for their capital assets. The amount is material however, not extremely ...






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Which of the following is not considered an accounting cycle?






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Which of the following would you not consider to be a strong source for learning and obtaining an understanding of a new clients business?






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Which of the following is not considered to be a principal management assertion?






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ABC Co.’s yearend is December 31st which falls on a Wednesday. Which of the following is not an example of a cutoff problem?






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Which of the following types of audit evidence is considered to be the most relevant and reliable i.e. the strongest form of evidence?






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When should analytical procedures be applied in an audit according to auditing standards?






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Which of the following information gathering activities or attention directing activity is not a form of analytical procedure?






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there are five general types of analytical procedures. Which of the following is not considered to be one of the five?






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Which of the following audit risk model statements can occur?






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The purpose of a balance-audit program is to...






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Which of the following would an auditor not include in a management report to the client at the end of an audit?






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External auditors are responsible for which of the following in an audit?






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Which of the following is not an element of internal control environments?






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Which of the following is not considered to be an essential function of an accounting system?






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At XYZ Co. the management is trying to ensure they have proper segregation of duties in place. They have given you the following functional responsibi...






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Select the term which best describes a departure from a prescribed internal control procedure in a particular case:






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The risk model is defined as: AR = IR x CR x DR. The risk of assessing control risk (CR) too low can lead to:






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Non statistical sampling should not be used when:






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If the association of population items with random numbers is difficult and expensive but the auditor does not have sufficient knowledge about the pop...






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Sampling risk is defined as:






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A computer based system does not include which of the following?






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A CAAT is a...






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Which of the following is not a method used by management to supervise the computer operation?






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The grandfather-father-son concept is a concept regarding...






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A run-to-run total is an example of a...






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Which of the following are characteristic signs of cheque kiting schemes:






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Typical source documents involved in the Revenue and Collection cycle does not include:






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The most frequent reconciliation is the comparison of the sum of customers’ unpaid balances with the accounts receivable control account total. Usua...






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A complete revenue and collection cycle walk-through involves:






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The control objective associated with selecting a sample of cash receipt remittance lists (or daily cash reports) and tracing them through to the cash...






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The Control Objective associated with selecting a sample of recorded sales invoices from the sales journal and performing recalculations to verify mat...






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The dividend and interest accounts will normally have already been audited in whole or in part through which balance sheet accounts?






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Analytical procedures used at the end of an audit are useful for what means?






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The property taxes and insurance accounts will normally have already been audited in whole or in part through which balance sheet accounts?






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Who is responsible for sending out legal enquiry letters?






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Who is responsible for the client representation letter and who is it addressed to?






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Review engagement standards indicate that review work should consist primarily of which of the following?






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For a set of financial statements that have been reviewed and a review engagement report is attached to the statements, each page must have which of t...






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Which of the following best describes the type of work a PA primarily performs in relation to a Compilation engagement?





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Which of the following would not be considered acceptable conduct for a professional accountant?






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The single most important principle that public accountant’s must follow is...






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If an auditor’s independence becomes disqualified in respect to a client they are auditing, they are responsible to...






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Which of the following would not be considered a reason for why professional ethics are necessary?






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You have just accepted the audit of Large Co. a public company and are the partner on the engagement. The firm has two partners – yourself and anoth...






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Breach of contract when referring to public accountants means...






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DEF Co. is being sold by GHI Co. JKL Co. is interested in purchasing DEF Co. but requires audited financial statements before doing so. DEF Co. has su...






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Given the highly litigious climate today that auditors have to work in, which of the following would not be prudent for the auditor to do?






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Which of the following would you consider to be an improvement in audit working paper files due to the increased litigation the public accounting prof...






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You have just acquired a new client and have discussed various services that you will perform for the client including the annual audit and preparatio...






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Fraud is considered when someone knowingly makes material misrepresentations of fact with the intent of making someone believe the falsehood and suffe...






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Which one of the following elements does fraud awareness auditing involve familiarity with the least of?






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What is the most important factor affecting the risk of management fraud?






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You are working at a medium sized company and notice that your co-worker is displaying some unusual beheviour. Which of the following would alert you ...






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Management in a company have caused financial statements to be materially misleading by the use of fraud and "creative accounting" due to difficult ti...






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The risk of accepting a material misstatement is referred to in auditing as:






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If at any stage the auditor estimates a material likely aggregate misstatement, then the auditor may:






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Conceptually, the auditor should pick that strategy of control testing combined with substantive tests of detail that:






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When auditors decide that an account balance is misstated by more than the material misstatement when, in fact, unknown to the auditors, it is not mis...






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Dollar unit sampling defines the population as: