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ACCT 4240 Audit Exam 1 (1)
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ACCT 4240 Audit Exam 1 (1)
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ACCT 4240 Audit Exam 1Responsibility for setting all audit standards to be followed on audits of public companies rests
with the: - ANS-PCAOB
Services that public accounting firms are prohibited from providing to audit clients under SOX
include: - ANS--legal and expert services
-internal audit outsourcing
-investment services
-actuarial services
Having an attitude that "includes a questioning mind and a critical assessment of evidence" is
the definition of: - ANS-professional skepticism
For assurance services, improving the quality or _______________ of information refers not to
the information itself, but to how the information is used in decision making. - ANS-context
For independent auditors, established criteria essential for effective communication may be
found in: - ANS--GAAP
-IFRS
Obtaining evidence about estimated liabilities relates to the ___________ assertion. -
ANS-rights and obligations
Designations for accountants within public accounting other than a CPA include: - ANS--certified
fraud examiner
-certified forensic accountant
-certified internal auditor
T/F: Providing assurance is a form of attestation. - ANS-False- attestation is a form of providing
assurance
The probability that data circulated by a company will be false or misleading
is_____________________. - ANS-information risk
Operational audits are: - ANS--a type of assurance service provided by public accounting firms
-performed by both internal and external auditors
-integral to internal auditing
When audit quality is compromised: - ANS-investor and creditor confidence is shaken.
Internal auditors: (choose all that apply)
, -examine evidence and issue an option on fairness of fs
-review the effectiveness of achieving results compared to established objectives
-review internal control systems to ensure compliance with company policies
-perform audits of financial reports for limited external distribution - ANS--review the
effectiveness of achieving results compared to established objectives
-review internal control systems to ensure compliance with company policies
-perform audits of financial reports for limited external distribution
When a CPA performs a ___________, limited-evidence gathering work is done, but the scope
is narrower than in an audit. - ANS-review
The assertions about the actuality of each balance sheet and income statement balance is
________________, while _____________ asserts that each event and transaction actually
happened. - ANS-existence; occurrence
Helping an organization accomplish its objectives by bringing a systematic, disciplined approach
to evaluate and improve the effectiveness of risk mgmt, control and governance processes is
the objective of______________ auditing. - ANS-internal
The US Government Accountability Office (GAO) ____________________.
(choose all that apply)
-provides a compliance audit function with respect to laws and regulations
-provides a wide range of performance audits
-performs attestation engagements but not financial audits
-emphasizes the accountability of public officials in regards to public funds and other resources -
ANS--provides a compliance audit function with respect to laws and regulations
-provides a wide range of performance audits
-emphasizes the accountability of public officials in regards to public funds and other resources
T/F: When considering established criteria for effective communication, external auditors rely on
financial and managerial models of efficiency and effectiveness. - ANS-False
The study of business activities for the purpose of making recommendations about the efficiency
and effective use of resources, effective achievement of business objectives and compliance
with company policies is __________ auditing. - ANS-operational
Services that public accounting firms are prohibited from providing to audit clients under SOX
include: (choose all that apply)
-tax return preparation advice
-financial information system design and implementation
-management or human resource services
-bookkeeping and relates services
-appraisal or valuation services - ANS--financial information system design and implementation
-management or human resource services
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