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ACCT 460 Exam 1 Practice Questions With Latest Answers 2024
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ACCT 460 Exam 1 Practice Questions With Latest Answers 2024
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ACCT 460 Exam 1 Practice Questions WithLatest Answers 2024
An .Independent .audit .adds .value .to .the .communication .of .financial .information .because
.the .audit
a. .guarantees .that .financial .data .are .fairly .presented.
b. .assures .the .readers .of .financial .statements .that .any
fraudulent .activity .has .been .corrected.
c. .confirms .the .exact .accuracy .of .management's
financial .representations.
d. .lends .credibility .to .the .financial .statements .- .correct .answer.d. .lends .credibility .to .the
.financial .statements
Which .of .the .following .best .describes .the .reason .why
an .independent .auditor .is .often .retained .to .report .on
financial .statements?
a. .Management .fraud .may .exist, .and .it .is .more .likely .to
be .detected .by .independent .auditors .than .by .internal
auditors.
b. .An .entity .may .have .a .poorly .designed .internal
control .system.
c. .Different .interests .may .exist .between .the .entity
preparing .the .statements .and .the .persons .using .the
statements, .and .thus .outside .assurance .is .needed .to
enhance .the .credibility .of .the .statements.
d. .A .misstatement .of .account .balances .may .exist, .and
all .misstatements .are .generally .corrected .as .a .result .of .the .independent .auditor's .work. .-
.correct .answer.c. .Different .interests .may .exist .between .the .entity .preparing .the
.statements .and .the .persons .using .the .statements, .and .thus .outside .assurance .is .needed
.to
enhance .the .credibility .of .the .statements.
Which .of .the .following .best .describes .relationships
among .auditing, .attest, .and .assurance .services?
a. .Assurance .is .a .type .of .attest .service.
, b. .Auditing .and .attest .services .represent .two .distinctly
different .types .of .services—there .is .no .overlap.
c. .Auditing .is .a .type .of .assurance .service.
d. .Attest .is .a .type .of .auditing .service .- .correct .answer.c. .Auditing .is .a .type .of .assurance
.service.
Which .of .the .following .statements .relating .to .attest
and .assurance .services .is .not .correct?
a. .Assurance .services .can .be .performed .to .improve .the .quality .or .context .of .information
.for .decision .makers.
b. .Financial .statement .auditing .is .a .form .of .attest
service .but .it .is .not .an .assurance .service.
c. .In .performing .an .attest .service, .the .CPA .determines
the .correspondence .of .the .subject .matter .(or .an
assertion .about .the .subject .matter) .against .criteria .that .are .suitable .and .available .to
.users.
d. .Independence .is .an .important .attribute .of .assurance .service .provider .- .correct
.answer.b. .Financial .statement .auditing .is .a .form .of .attest .service .but .it .is .not .an
.assurance .service.
For .what .primary .purpose .does .the .auditor .obtain .an
understanding .of .the .entity .and .its .environment?
a) .To .limit .audit .risk .to .an .appropriately .high .level.
b) .To .plan .the .audit .and .determine .the .nature, .timing,
and .extent .of .audit .procedures .to .be .performed.
c) .To .decide .which .facts .about .the .entity .to .include .in
the .audit .report.
d) .To .determine .the .audit .fee. .- .correct .answer.b) .To .plan .the .audit .and .determine .the
.nature, .timing, .and .extent .of .audit .procedures .to .be .performed.
Which .of .the .following .statements .best .describes .the
role .of .materiality .in .a .financial .statement .audit?
a. .The .higher .the .level .at .which .the .auditor .assesses
materiality, .the .greater .the .amount .of .evidence .the
auditor .must .gather.
b. .Materiality .refers .to .the ."material" .from .which .audit
evidence .is .developed.
c. .The .lower .the .level .at .which .the .auditor .assesses
materiality, .the .greater .the .amount .of .evidence .the
auditor .must .gather.
d. .The .level .of .materiality .has .no .bearing .on .the
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