Exam (elaborations)
ACCT402 WITH Verified Answers
- Course
- Institution
ACCT402 WITH Verified Answers
[Show more]
Seller
Follow
smartchoices
Reviews received
Content preview
ACCT402 Exam 1 With verified AnswersIn an integrated audit, the objective is to issue a report on the internal controls over financial
reporting indicating compliance with:
A. Generally accepted accounting principles
B. Generally accepted auditing standards
C. PCAOB standards
D. COSO framework - Answer- D. COSO framework
Which of the following audits is performed by a GAO auditor?
A. Audit of the SEC's internal controls over operations and other functions
B. Audit of Apple Inc.'s corporate tax returns
C. Integrated audit of Google's financial statements and internal controls.
D. Audit for compliance with debt agreement for a privately held company - Answer- A. Audit of the
SEC's internal controls over operations and other functions
The joint project between the AICPA and the IAASB leading to principle-based converged U.S. auditing
standards is called:
A. The Clarity Project
B. Interim Standards
C. Auditing Standards (AS)
D. The Clarified Standards - Answer- A. The Clarity Project
Which of the following is false?
A. Review reports issued by the independent CPA provide reasonable assurance as to the fair
presentation of financial statements.
B. Reporting on compliance with contractual debt agreements by an independent CPA is an example of
attestation service.
,C. Examination of financial statements includes evaluating management's assumptions in projected
financial statements.
D. Review services provide limited assurance on financial statements and are less in scope than audits. -
Answer- A. Review reports issued by the independent CPA provide reasonable assurance as to the fair
presentation of financial statements.
Which of the following is an example of a non assurance service:
A. The integrated audit of the internal controls over financial reporting with the audit of the financial
statements
B. Review of historical financial statements
C. Aggressive tax planning
D. Counting ballots for the Oscar nominations - Answer- C. Aggressive tax planning
Evaluating the efficiency of a company's logistic system is an example of?
A. Compliance audit that may be performed by the internal auditors
B. Financial statements audit performed by the GAO auditors
C. Examination service that do not require independence
D. Operational audit that may be performed by independent CPAs. - Answer- D. Operational audit that
may be performed by independent CPAs.
Which of the following statements is correct?
A. The 10-Ks contains audited quarterly financial statements
B. The SEC requires annual reports for all public companies
C. The PCAOB conducts peer reviews for auditor with public audit clients
D. The SEC requires CPA firms to register with the PCAOB - Answer- B. The SEC requires annual reports
for all public companies
" Plan and supervise staff" is one of the:
A. Responsibilities standards of Clarified GAAS
B. Performance standards of Clarified GAAS
C. Reporting standards of GAAS
,D. General standards of the AICPA Code of Conduct - Answer- B. Performance standards of Clarified
GAAS
Prior to the passage of the Sarbanes-Oxley Act, which of the following was responsible for establishing
auditing standards for public companies?
A. Securities and Exchange Commission
B. American Institute of Certified Public Accountants
C. Financial Accounting Standards Board
D. National Association of States Board of Accountancy - Answer- B. American Institute of Certified Public
Accountants
As a result of the Sarbanes-Oxley Act, the PCAOB has been created. Which of the following is false?
A. The PCAOB members are appointed by the SEC.
B. The PCAOB is a government agency that permanently exempted non accelerated filers from
compliance with SOX Section 404.
C. The PCAOB establishes the professional standards for auditors of publicly traded companies.
D. All accounting firms that audit or participate in the preparation of an audit report for a public
company must be inspected either annually or once every three years. - Answer- B. The PCAOB is a
government agency that permanently exempted non accelerated filers from compliance with SOX
Section 404.
Which of the following is not an example of a compliance audit?
A. The audit of corporate tax returns by the IRS agents
B. The audit of the cost accounting system to recommend to management areas to improve on the
system's efficiency and effectiveness
C. The audit of the SEC's financial statements to examine that funds were spent in accordance with the
law that authorized the budget.
D. The audit of the internal controls over financial reporting for a publicly traded company - Answer- B.
The audit of the cost accounting system to recommend to management areas to improve on the
system's efficiency and effectiveness
Which of the following statements is false?
A. The interim standards and the newly issued PCAOB standards are called PCAOB auditing standards
, B. The general corporation form of business is generally prohibited for CPA firms
C. The IAASB has the authority to enforce the International Standards on Auditing throughout the world
D. Non accelerated filers are public companies with less than $75 million in market capitalization. -
Answer- C. The IAASB has the authority to enforce the International Standards on Auditing throughout
the world
Which of the following is not one of the clarified GAAS?
A. General standards
B. Responsibilities
C. Reporting
D. Performance - Answer- A. General standards
Rule 201, General Standards, requires a member to comply with standards and interpretations. Which of
the following is not a standard covered by Rule 201?
A. Independence
B. Due professional care
C. Planning and supervision
D. Sufficient relevant data - Answer- A. Independence
Generally, the date of the auditor's report signifies:
A. The last day of fieldwork
B. The date of filing with the SEC through the Edger Filing System
C. The date of the balance sheet
D. The date of auditor receiving his full compensation for the audit, because otherwise auditor is not
independent - Answer- A. The last day of fieldwork
The client tells the auditor that their investors find the statement of cash flows confusing and therefore
the client declines to include this statement in the set of the annual financials. Given this situation:
A. A qualified opinion only with an additional paragraph before the opinion paragraph is appropriate
B. An adverse opinion with an additional paragraph after the opinion paragraph is appropriate
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 smartchoices. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $8.79. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
75323 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now