Which of the following would be considered an assurance engagement?
a. Giving an opinion on a prize promoter's claims about the amount of sweepstakes prizes awarded in the past.
b. Giving an opinion on the conformity of the financial statements of a university with generally accepted accounting...
Which of the following would be considered an assurance engagement?
a. Giving an opinion on a prize promoter's claims about the amount of
sweepstakes prizes awarded in the past.
b. Giving an opinion on the conformity of the financial statements of a university
with generally accepted accounting principles.
c. Giving an opinion on the fair presentation of a newspaper's circulation data.
d. Giving assurance about the average drive length achieved by golfers with a
client's golf balls
e. All of the choices are correct. - ANSWER- e. All of the choices are correct.
In an attestation engagement, a CPA practitioner is engaged to:
a. Compile a company's financial forecast based on management's assumptions
without expressing any form of assurance.
b. Prepare a written report containing a conclusion about the reliability of a
management assertion.
c. Prepare a tax return using information the CPA has not audited or reviewed.
d. Give expert testimony in court on particular facts in a corporate income tax
controversy. - ANSWER- b. Prepare a written report containing a conclusion
about the reliability of a management assertion.
According to the AICPA, the purpose of an audit of financial statements is to:
a. Enhance the degree of confidence that intended users can place in the
financial statements.
b. Express an opinion on the fairness with which they present financial position,
results of operations, and cash flows in conformity with accounting standards
promulgated by the Financial Accounting Standards Board.
c. Express an opinion on the fairness with which they present financial position,
results of operations, and cash flows in conformity with accounting standards
promulgated by the U.S. Securities and Exchange Commission.
, d. Obtain systematic and objective evidence about financial assertions and report
the results to interested users. - ANSWER- a. Enhance the degree of confidence
that intended users can place in the financial statements.
It is always a good idea for auditors to begin an audit with the professional
skepticism characterized by the assumption that:
a. A potential conflict of interest always exists between the auditor and the
management of the enterprise under audit.
b. In audits of financial statements, the auditor acts exclusively in the capacity of
an auditor.
c. The professional status of the independent auditor imposes commensurate
professional obligations.
d. Financial statements and financial data are verifiable. - ANSWER- a. A potential
conflict of interest always exists between the auditor and the management of the
enterprise under audit.
The objective in an auditor's review of credit ratings of a client's customers is to
obtain evidence related to management's assertion about:
a. Completeness.
b. Existence.
c. Valuation and allocation.
d. Rights and obligations.
e. Occurrence. - ANSWER- c. Valuation and allocation.
When auditing merchandise inventory at year-end, the auditor performs audit
procedures to ensure that all goods purchased before year-end are received
before the physical inventory count. This audit procedure provides assurance
about which management assertion?
a. Cutoff.
b. Existence.
c. Valuation and allocation.
d. Rights and obligations.
e. Occurrence. - ANSWER- a. Cutoff.
A review service engagement involving unaudited financial statements involves
a. Less work than a compilation but more work than an audit.
b. More work than a compilation and an audit.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller BRAINSCAPE1. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $10.99. You're not tied to anything after your purchase.
