10/22/24, 1:29 PM ACCT 3222-3, EXAM 1 NEWEST 2024 ACTUAL EXAM 270 QUESTIONS AND CORRECT DETAILED ANSWERS (VERIFIED AN…
ACCT 3222-3, EXAM 1 NEWEST 2024 ACTUAL
EXAM 270 QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS) |ALREADY
GRADED A+
Terms in this set (270)
services by an independent CPA that provide financial
statement users with (1) an opinion on whether the
financial statements are presented fairly, in all material
respects, in accordance with an applicable financial
Audit Services
reporting framework and (2) an opinion on the
effectiveness of ICFR, which enhance the degree of
confidence that intended users can place in the
financial statements
Services performed when an independent
practitioner, or CPA, is engaged to issue a report on
Attestation Services
subject matter that is the responsibility of another
party
Audit - highest quality/reasonable assurance (i.e.,
historical financial statements)
Relationship of assurance,
Attestation - mid quality/limited assurance (i.e., review
attestation, and auditing
of historical financial statements, examination of
services from most to
internal controls, review of financial forecast)
least improved of quality
Assurance - lowest quality (i.e., compilation of
(i.e., assurance)
historical financial statements, website security, IT
operations, non-financial information)
independent professional services that improve the
Assurance Services quality of information, or its context, for decision
makers
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,10/22/24, 1:29 PM ACCT 3222-3, EXAM 1 NEWEST 2024 ACTUAL EXAM 270 QUESTIONS AND CORRECT DETAILED ANSWERS (VERIFIED AN…
Applicable financial the set of standards used in preparing the historical
reporting framework financial statements (i.e., GAAP, IFRS, or federal
refers to income tax basis of accounting)
Independent implies that someone who was not involved with the creation of
the service is performed the information and who is objective in the evaluation
by of the information
Quality refers to the relevance and realiability of the information
subject matter that can be financial or nonfinancial,
Information refers to historical or prospective, standalone data or entire
systems of data, internal or external to a company
CPAs are the only _________ Licensed accounting professionals in the US.
accounting professionals Licenses are issued at the state level, not federal
in the US and the ________
are issued at the ____________
level
A state board of a licence to practice after all three Es have been
accountancy will only earned
issue
CPA Es Education, Exam, and Experience
Public companies, or an annual financial statement audit and an ICFR audit
issuers, in the US are
required by federal
government to have
Private companies, or Not required by law, other interested users may
non-issuers, are _______ to request audited financial statements (i.e., lenders)
have an annual audit by
federal government, but
ICFR Internal Control over Financial Reporting
An audit that combines the financial statement audit
Integrated Audit
with an audit of the effectiveness of ICFR
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, 10/22/24, 1:29 PM ACCT 3222-3, EXAM 1 NEWEST 2024 ACTUAL EXAM 270 QUESTIONS AND CORRECT DETAILED ANSWERS (VERIFIED AN…
1. the nature of financial reporting
The limitations of an audit 2. the nature of audit procedures
are cause by 3. the need for the audit to be conducted within a
reasonable period of time at a reasonable cost
the use of judgment when preparing financial
statements due to the subjectivity required when
The nature of financial
arriving at accounting estimates and judgment
reporting refers to
required when selecting and applying accounting
methods
The nature of audit Reliance on evidence provided by the client and its
procedures refers to managements, as well as the concept of materiality
the ability of information to influence decisions that
Materiality users make on the basis of the financial information of
a specific reporting entity
an audit to determine whether the entity has
Compliance Audit
conformed with regulations, rules, or processes
Operational An assessment of the economy, efficiency, and
(Performance) Audit effectiveness of an organization's operations
Economy refers to the cost of inputs
Operational Audit Efficiency refers to the relationship between inputs
economy, efficiency, and and outputs
effectiveness refer to Effectiveness refers to the achievement of certain
goals or the production of a certain level of outputs
A function within an entity which generally evaluates
Internal Audit and improves risk management, internal control
procedures, and elements of the governance process
Persons with responsibility for overseeing the
Those charged with
strategic direction of the entity and the obligations
governance
related to the accountability of the entity
Internal auditors when evaluating the evidence
The external auditor may
needed to form an opinion on the financial statements
rely on the work done by
or on ICFR
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