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ACCP301 - Auditing and Assurance Principles (1)
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- CISA: Domain #2, Part A: IT Governance
ACCP301 - Auditing and Assurance Principles (1)
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ACCP301 - Auditing and Assurance PrinciplesB - ANS-Which of the following best describes the reason why independent auditors report on
financial statements?
A. A management fraud may exist and it is more likely to be detected by independent auditors.
B. Different interests may exist between the company preparing the statements and the persons
using the statements.
C. A misstatement of account balances may exist and is generally corrected as the result of the
independent auditors' work.
D.Poorly designed internal control may be in existence.
C - ANS-A practitioner should accept an assurance engagement only if
A. The subject matter is in the form of financial information.
B. The criteria to be used are not available to the intended users.
C. The practitioner's conclusion is to be contained in a written report.
D. The subject matter is the responsibility of either the intended users or the practitioner.
A - ANS-The auditor is required to maintain professional skepticism throughout the audit. Which
of the following statements concerning professional skepticism is false?
A. A belief that management and those charged with governance are honest and have integrity
relieves the auditor of the need to maintain professional skepticism.
B. Maintaining professional skepticism throughout the audit reduces the risk of using
inappropriate assumptions in determining the nature, timing, and extent of the audit procedures
and evaluating the results thereof.
C. Professional skepticism is necessary to the critical assessment of audit evidence.
D. Professional skepticism is an attitude that includes questioning contradictory audit evidence
obtained.
B - ANS-Which of the following best describes the reason why independent auditors report on
financial statements?
A. A management fraud may exist and it is more likely to be detected by independent auditors.
B. Different interests may exist between the company preparing the statements and the persons
using the statements.
C. A misstatement of account balances may exist and is generally corrected as the result of the
independent auditors' work.
D.Poorly designed internal control may be in existence.
A - ANS-What is the proper organizational role of internal auditing?
A. To serve as an independent, objective assurance and consulting activity that adds value to
operations.
B. To assist the external auditor in order to reduce external audit fees.
C. To perform studies to assist in the attainment of more efficient operations.
, D. To serve as the investigative arm of the audit committee of the board of directors.
A - ANS-Operational audits generally have been conducted by internal and COA auditors, but
may be performed by certified public accountants. A primary purpose of an operational audit is
to provide
A. A measure of management performance in meeting organizational goals.
B. The results of internal examinations of financial and accounting matters to a company's
top-level management.
C. Aid to the independent auditor, who is conducting the examination of the financial
statements.
D. A means of assurance that internal accounting controls are functioning as planned.
C - ANS-Which of the following terms best describes the audit of a taxpayer's return by a BIR
auditor?
A. Operational audit.
B. Internal audit.
C. Compliance audit.
D.Government audit.
C - ANS-The members of the Professional Regulatory Board of Accountancy shall be appointed
by the
A. Philippine Institute of CPAs (PICPA).
B. Professional Regulation Commission (PRC).
C. President of the Philippines.
D.Association of CPAs in Public Practice (ACPAPP).
D - ANS-The following statements relate to the submission of nominations to the Board of
Accountancy. Which is correct?
A. The Accredited National Professional Organization of CPAs (APO) shall submit its
nominations to the president of the Philippines not later than sixty (60) days prior to the expiry of
the term of an incumbent chairman or member.
B. The APO shall submit its nominations to the PRC not later than thirty (30) days prior to the
expiry of the term of an incumbent chairman or member.
C. If the APO fails to submit its own nominee(s) to the PRC within the required period, the PRC
in consultation with the Board of Accountancy shall submit to the president of the Philippines a
list of five (5) nominees for each position.
D. There should be adequate documentation to show the qualifications and primary field of
professional activity of each nominee.
C - ANS-The following statements relate to the term of office of the chairman and members of
the Board of Accountancy (BOA). Which is false?
A. The chairman and members of the BOA shall hold office for a term of three (3) years.
B. Any vacancy occurring within the term of a member shall be filled up for the unexpired portion
of the term only.
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