Which of the following will an auditor least likely discuss with the former auditors of a potential client prior to acceptance? a. Disagreements with management regarding accounting principles b. Integrity of management c. Fees charged for services d. Reasons for changing audit firms

Which of the following will an auditor least
likely discuss with the former auditors of a
potential client prior to acceptance?
a. Disagreements with management
regarding accounting principles
b. Integrity of management
c. Fees charged for services
d. Reasons for changing audit firms
by

1 Answer

Answer :

Fees charged for services
by

Related questions

Which of the following will an auditor least likely discuss with the former auditors of a potential client prior to acceptance? a. Disagreements with management regarding accounting principles b. Integrity of management c. Fees charged for services d. Reasons for changing audit firms

Description : Which of the following will an auditor least likely discuss with the former auditors of a potential client prior to acceptance? a. Disagreements with management regarding accounting principles b. Integrity of management c. Fees charged for services d. Reasons for changing audit firms

Last Answer : Fees charged for services

What will an auditor who has been proposed for an audit engagement usually do prior to accepting a new client? a. Draft the financial statements of the client as a measure of goodwilb. With the permission from the prospective client, contact the predecessor auditor to determine if there are any disagreements between the client and the audit firms. c. Obtain the potential client's permission to talk to the former auditor and review work papers. d. Perform a peer review on the potential client in accordance with professional standardsl

Description : What will an auditor who has been proposed for an audit engagement usually do prior to accepting a new client? a. Draft the financial statements of the client as a measure of goodwill b ... review work papers. d. Perform a peer review on the potential client in accordance with professional standards

Last Answer : With the permission from the prospective client, contact the predecessor auditor to determine if there are any disagreements between the client and the audit firms

A successor auditor most likely would make specific inquiries of the predecessor auditor regarding a. Specialized accounting principles of the client's industry. b. Disagreements with management as to auditing procedures. c. The competency of the client's internal audit staff. d. The uncertainty inherent in applying sampling procedures.

Description : A successor auditor most likely would make specific inquiries of the predecessor auditor regarding a. Specialized accounting principles of the client's industry. b. Disagreements with management as to ... the client's internal audit staff. d. The uncertainty inherent in applying sampling procedures.

Last Answer : Disagreements with management as to auditing procedures

Before accepting an audit engagement, a successor auditor should make specific inquiries of the predecessor auditor regarding a. Disagreements the predecessor had with the client concerning auditing procedures and accounting principles. b. The predecessor’s evaluation of matters of continuing accounting significance. c. The degree of cooperation the predecessor received concerning the inquiry of the client’s lawyer. d. The predecessor’s assessments of inherent risk and judgments about materiality

Description : Before accepting an audit engagement, a successor auditor should make specific inquiries of the predecessor auditor regarding a. Disagreements the predecessor had with the client concerning auditing ... lawyer. d. The predecessor's assessments of inherent risk and judgments about materiality

Last Answer : Disagreements the predecessor had with the client concerning auditing procedures and accounting principles.

Preplanning the audit involves several key activities which include the following except: a. Investigating the client's background. b. Communicating with the prospective client's prior auditor to inquire about any disagreements with the client. c. Understanding the client's reasons for obtaining an audit. d. Determining the likelihood of issuing an unqualified audit opinion on the client's financial statements.

Description : Preplanning the audit involves several key activities which include the following except: a. Investigating the client's background. b. Communicating with the prospective client's prior auditor to ... the likelihood of issuing an unqualified audit opinion on the client's financial statements.

Last Answer : Determining the likelihood of issuing an unqualified audit opinion on the client's financial statements.

Which of the following statements is correct? a. Sufficiency refers to the quality of evidence, while appropriateness refers to the quantity of evidence. b. The reliability of evidence is influenced not by its nature but by its source. c. The performance of consulting services for audit clients does not, in and of itself, impair the auditor’s independence. d. A belief that management and those charged with governance are honest and have integrity relieves the auditor of the need to maintain professional scepticism.

Description : Which of the following statements is correct? a. Sufficiency refers to the quality of evidence, while appropriateness refers to the quantity of evidence. b. The reliability of evidence is ... are honest and have integrity relieves the auditor of the need to maintain professional scepticism.

Last Answer : The performance of consulting services for audit clients does not, in and of itself, impair the auditor’s independence

Which of the following is the most likely first step an auditor would perform at the beginning of an initial audit engagement? a. Prepare a rough draft of the financial statements and of the auditor's report. b. Study and evaluate the system of internal administrative control. c. Tour the client's facilities and review the general records. d. Consult with and review the work of the predecessor auditor prior to discussing the engagement with the client management

Description : Which of the following is the most likely first step an auditor would perform at the beginning of an initial audit engagement? a. Prepare a rough draft of the financial statements and of ... and review the work of the predecessor auditor prior to discussing the engagement with the client management

Last Answer : Tour the client's facilities and review the general records

Which of the following is the most likely first step an auditor would perform at the beginning of an initial audit engagement? a. Prepare a rough draft of the financial statements and of the auditor's report. b. Study and evaluate the system of internal administrative control. c. Tour the client's facilities and review the general records. d. Consult with and review the work of the predecessor auditor prior to discussing the engagement with the client management

Description : Which of the following is the most likely first step an auditor would perform at the beginning of an initial audit engagement? a. Prepare a rough draft of the financial statements and of ... and review the work of the predecessor auditor prior to discussing the engagement with the client management

Last Answer : Tour the client's facilities and review the general records

Which of the following is the most likely first step an auditor would perform at the beginning of an initial audit engagement? a. Prepare a rough draft of the financial statements and of the auditor's report. b. Study and evaluate the system of internal administrative control. c. Tour the client's facilities and review the general records. d. Consult with and review the work of the predecessor auditor prior to discussing the engagement with the client management

Description : Which of the following is the most likely first step an auditor would perform at the beginning of an initial audit engagement? a. Prepare a rough draft of the financial statements and of ... and review the work of the predecessor auditor prior to discussing the engagement with the client management

Last Answer : Tour the client's facilities and review the general records

Which of the following statements would least likely appear in an auditor's engagement letter? a. Our engagement is subject to the risk that material errors, fraud, and defalcations, if they exist, will not be detected. b. During the course of our audit we may observe opportunities for economy in, or improved controls over, your operations. c. After performing our preliminary analytical procedures we will discuss with you the other procedures we consider necessary to complete the engagement. d. Fees for our services are based on our regular per diem rates, plus travel and other out-of-pocket expenses

Description : Which of the following statements would least likely appear in an auditor's engagement letter? a. Our engagement is subject to the risk that material errors, fraud, and defalcations, if they exist, ... services are based on our regular per diem rates, plus travel and other out-of-pocket expenses

Last Answer : After performing our preliminary analytical procedures we will discuss with you the other procedures we consider necessary to complete the engagement.

A violation of the ethical standards would most likely have occurred when a CPA a. Made arrangement with a bank to collect notes issued by a client in payment of fees due. b. Joined an accounting firm made up of three non-CPA practitioners. c. Issued an unqualified opinion on the 2006 financial statements when fees for the 2005 audit were unpaid. d. Purchased a bookkeeping firm's practice of monthly write-ups for a percentage of fees received over a three-year period

Description : A violation of the ethical standards would most likely have occurred when a CPA a. Made arrangement with a bank to collect notes issued by a client in payment of fees due. b. Joined an ... bookkeeping firm's practice of monthly write-ups for a percentage of fees received over a three-year period

Last Answer : Issued an unqualified opinion on the 2006 financial statements when fees for the 2005 audit were unpaid

A violation of the ethical standards would most likely have occurred when a CPA a. Made arrangement with a bank to collect notes issued by a client in payment of fees due. b. Joined an accounting firm made up of three non-CPA practitioners. c. Issued an unqualified opinion on the 2010 financial statements when fees for the 2009 audit were unpaid. d. Purchased a bookkeeping firm's practice of monthly write-ups for a percentage of fees received over a three-year period.

Description : A violation of the ethical standards would most likely have occurred when a CPA a. Made arrangement with a bank to collect notes issued by a client in payment of fees due. b. Joined an accounting ... firm's practice of monthly write-ups for a percentage of fees received over a three-year period.

Last Answer : Issued an unqualified opinion on the 2010 financial statements when fees for the 2009 audit were unpaid

Before accepting an audit engagement, a successor auditor should make specific inquiries of the predecessor auditor regarding the predecessor's a. Evaluation of all matters of continuing accounting significance. b. Understanding as to the reasons for the change of auditors. c. Awareness of the consistency in the application of GAAP between periods. d. Opinion of any subsequent events occurring since the predecessor's audit report was issued

Description : Before accepting an audit engagement, a successor auditor should make specific inquiries of the predecessor auditor regarding the predecessor's a. Evaluation of all matters of continuing accounting ... . Opinion of any subsequent events occurring since the predecessor's audit report was issued

Last Answer : Understanding as to the reasons for the change of auditors

The primary reason an engagement letter is obtained by audit firms prior to starting the work is that a. It provides an insurance policy for companies entering into the agreement. b. It clarifies the responsibilities of management and those of the auditor. c. It communicates the type of opinion that will be rendered on the engagement d. It defines the firm's policies and procedures regarding new clients

Description : The primary reason an engagement letter is obtained by audit firms prior to starting the work is that a. It provides an insurance policy for companies entering into the agreement. b. It clarifies ... be rendered on the engagement d. It defines the firm's policies and procedures regarding new clients

Last Answer : It clarifies the responsibilities of management and those of the auditor

The most likely explanation why the auditor’s examination cannot reasonably be expected to bring all illegal acts by the client to the auditor’s attention is that a. Illegal acts are perpetrated by management override of internal control. b. Illegal acts by clients often relate to operating aspects rather than accounting aspects. c. The client’s internal control may be so strong that the auditor performs only minimal substantive testing. d. Illegal acts may be perpetrated by the only person in the client’s organization

Description : The most likely explanation why the auditor's examination cannot reasonably be expected to bring all illegal acts by the client to the auditor's attention is that a. Illegal acts are perpetrated by ... testing. d. Illegal acts may be perpetrated by the only person in the client's organization

Last Answer : Illegal acts by clients often relate to operating aspects rather than accounting aspects

.If specific information comes to an auditor's attention that implies the existence of possible illegal acts that could have amaterial, but indirect effect on-the financialstatements, the auditor should nexta. Report the matter to an appropriate levelof management at least one level abovethose involved.b. Apply audit procedures specificallydirected to ascertaining whether anillegal act has occurred.c. Seek the advice of an informed expertqualified to practice law as to possiblecontingent liabilities.d. Discuss the evidence with the client'saudit committee, or others withequivalent authority.

Description : .If specific information comes to an auditor's attention that implies the existence of possible illegal acts that could have a material, but indirect effect on-the financial statements, the auditor ... d. Discuss the evidence with the client's audit committee, or others with equivalent authority.

Last Answer : Apply audit procedures specifically directed to ascertaining whether an illegal act has occurred

Which of the following statements about independent financial statement audit is correct? a. The audit of financial statements relieves management of its responsibilities for die financial statements. b. An audit is designed to provide limited assurance that the financial statements taken as a whole are free from material misstatement. c. The auditor's opinion is not an assurance as to the future viability of the entity as well as the effectiveness and efficiency withwhich management has conductedthe affairs of the entity.d. The procedures required to conduct anaudit in accordance with PSAs shouldbe determined by the client whoengaged the services of the auditor

Description : Which of the following statements about independent financial statement audit is correct? a. The audit of financial statements relieves management of its responsibilities for die financial statements. b. An ... with PSAs should be determined by the client who engaged the services of the auditor

Last Answer : The auditor's opinion is not an assurance as to the future viability of the entity as well as the effectiveness and efficiency withwhich management has conducted the affairs of the entity.

For initial audits, additional matters the auditor may consider in the overall audit strategy and audit plan include the following except a. Major issues including the application of accounting principles or any auditing and reporting standards discussed with management. b. Confirmation of material accounts receivable balance at the end of the year. c. Planned audit procedure to obtain sufficient appropriate audit evidence regarding opening balances. d. Assignment of firm personnel with appropriate levels of capabilities and competence to respond to anticipated significant risks

Description : For initial audits, additional matters the auditor may consider in the overall audit strategy and audit plan include the following except a. Major issues including the application of ... firm personnel with appropriate levels of capabilities and competence to respond to anticipated significant risks

Last Answer : Confirmation of material accounts receivable balance at the end of the year.

The auditor's best defense when material misstatements in the financial statements are not uncovered in the audit is that a. The financial statements are client's responsibility. b. The audit was conducted in accordance with PSAs c. Client is guilty of contributory negligence. d. The audit was conducted in accordance with generally accepted accounting principles.

Description : The auditor's best defense when material misstatements in the financial statements are not uncovered in the audit is that a. The financial statements are client's responsibility. b. ... contributory negligence. d. The audit was conducted in accordance with generally accepted accounting principles.

Last Answer : The audit was conducted in accordance with PSAs

At the beginning of the current audit engagement, the auditor should perform key preplanning activities which include all of the following except: a. Performing procedures regarding client acceptance or continuance. b. Evaluating compliance with ethical requirements. c. Establishing an understanding of the terms of the engagement. d. Considering internal contro

Description : At the beginning of the current audit engagement, the auditor should perform key preplanning activities which include all of the following except: a. Performing procedures regarding client acceptance ... c. Establishing an understanding of the terms of the engagement. d. Considering internal contro

Last Answer : Considering internal contro

Which of the following activities is not prohibited for the CPA firm's attestation service clients? a. Referral fees on audit jobs. b. Competitive bidding on audit jobs. c. Contingent fees on audit jobs. d. Commissions for obtaining client services on audit jobs

Description : Which of the following activities is not prohibited for the CPA firm's attestation service clients? a. Referral fees on audit jobs. b. Competitive bidding on audit jobs. c. Contingent fees on audit jobs. d. Commissions for obtaining client services on audit jobs

Last Answer : Competitive bidding on audit jobs

Which of the following activities is not prohibited for the CPA firm's attestation service clients? a. Competitive bidding on audit jobs. b. Contingent fees on audit jobs. c. Commissions for obtaining client services on audit jobs. d. Referral fees on audit jobs.

Description : Which of the following activities is not prohibited for the CPA firm's attestation service clients? a. Competitive bidding on audit jobs. b. Contingent fees on audit jobs. c. Commissions for obtaining client services on audit jobs. d. Referral fees on audit jobs.

Last Answer : Competitive bidding on audit jobs

In assessing the technical competence of an internal auditor, an external auditor most likely would obtain information about the a. Organizational level to which the internal auditor reports. b. Quality of working paper documentation, reports, and recommendations. c. Influence of management on the internal auditor's duties. d. Entity's commitment to integrity and ethical values.

Description : In assessing the technical competence of an internal auditor, an external auditor most likely would obtain information about the a. Organizational level to which the internal auditor reports. b. Quality of ... on the internal auditor's duties. d. Entity's commitment to integrity and ethical values.

Last Answer : Quality of working paper documentation, reports, and recommendations

Warning signs that cause the auditor to question management integrity must be taken seriously and pursued vigorously. Which of the following may lead the auditor to suspect management dishonesty? a. The client has been named as a defendant in a product liability suit. b. The client has experienced a decrease in revenue from increased import competition. c. A new statutory regulation making customer licenses more difficult to obtain may adversely affect the client's operations. d. The president and chief executive officer of the client corporation has held numerous meetings with the controller for the purpose of discussing accounting practices that will maximize reported profits

Description : Warning signs that cause the auditor to question management integrity must be taken seriously and pursued vigorously. Which of the following may lead the auditor to suspect management ... with the controller for the purpose of discussing accounting practices that will maximize reported profits

Last Answer : The president and chief executive officer of the client corporation has held numerous meetings with the controller for the purpose of discussing accounting practices that will maximize reported profits

.If a professional accountant is billing an audit client a number of hours greater than those actually worked, which of the following fundamental principles is likely violated? a. Objectivity b. Integrity c. Professional due care d. Confidentiality

Description : If a professional accountant is billing an audit client a number of hours greater than those actually worked, which of the following fundamental principles is likely violated? a. Objectivity b. Integrity c. Professional due care d. Confidentiality

Last Answer : Integrity

A successor auditor is required to communicate with the previous auditor. The primary concern in this communication is a. Information which will help the successor auditor in determining whether the client management has integrity. b. To learn about client by examining predecessor's working papers. c. To enable successor auditor to perform a more efficient audit. d. To save successor auditor time and money in gathering data.

Description : A successor auditor is required to communicate with the previous auditor. The primary concern in this communication is a. Information which will help the successor auditor in determining whether the client ... a more efficient audit. d. To save successor auditor time and money in gathering data.

Last Answer : Information which will help the successor auditor in determining whether the client management has integrity.

Which of the following is least likely considered a financial statement audit risk factor? a. Management operating and financing decisions are dominated by top management. b. A new client with no prior audit history. c. Rate of change in the entity's industry is rapid. Profitability of the entity relative to its industry is inconsistent.d

Description : Which of the following is least likely considered a financial statement audit risk factor? a. Management operating and financing decisions are dominated by top management. b. A new client with no ... entity's industry is rapid d. Profitability of the entity relative to its industry is inconsistent.

Last Answer : Management operating and financing decisions are dominated by top management.

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 goalsb. 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.

Description : 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: ... statements. d. A means of assurance that internal accounting controls are functioning as planned

Last Answer : A measure of management performance in meeting organizational goals

.A written understanding between the auditor and the client concerning the auditor's responsibility for the discovery of illegal acts is usually set forth in a(an) a. Letter of audit inquiry. b. Client representation letter. c. Management letter. d. Engagement letter

Description : .A written understanding between the auditor and the client concerning the auditor's responsibility for the discovery of illegal acts is usually set forth in a(an) a. Letter of audit inquiry. b. Client representation letter. c. Management letter. d. Engagement letter

Last Answer : Engagement letter

To obtain an understanding of a continuing client’s business in planning an audit, an auditor most likely would a. Read specialized industry journals. b. Review prior year working papers and the permanent file for the client. c. Reevaluate the client’s internal control environment. d. Perform tests of details of transactions and balances

Description : To obtain an understanding of a continuing client's business in planning an audit, an auditor most likely would a. Read specialized industry journals. b. Review prior year working papers and ... the client's internal control environment. d. Perform tests of details of transactions and balances

Last Answer : Review prior year working papers and the permanent file for the client

When management refuses to disclose in the financial statements noncompliance to laws and regulations which are identified by the independent auditor, the CPA may be charged with unethical conduct for a. Withdrawing from the engagement. b. Issuing a disclaimer of opinionc. Failure to uncover the noncompliance to laws and regulations during the prior audits. d. Reporting these activities to the audit committee..

Description : When management refuses to disclose in the financial statements noncompliance to laws and regulations which are identified by the independent auditor, the CPA may be charged with unethical conduct for ... and regulations during the prior audits. d. Reporting these activities to the audit committee.

Last Answer : Issuing a disclaimer of opinion

What is the most likely course of action that will be taken by an auditor in assessing management integrity? a. Tour the client premises. b. Research the prospective client’s related parties. c. Research the background and histories of officers d. Review the minutes of the board of directors

Description : What is the most likely course of action that will be taken by an auditor in assessing management integrity? a. Tour the client premises. b. Research the prospective client’s related parties. c. Research the background and histories of officers d. Review the minutes of the board of directors

Last Answer : Research the background and histories of officers

The auditor's defense of contributory negligence is most likely to prevail when a. Third party injury has been minimal. b. The client is privately held as contrasted with a public company. c. Undetected errors have resulted in materially misleading financial statements. d. The auditor fails to detect fraud resulting from management override of the control structure

Description : The auditor's defense of contributory negligence is most likely to prevail when a. Third party injury has been minimal. b. The client is privately held as contrasted with a public company ... statements. d. The auditor fails to detect fraud resulting from management override of the control structure

Last Answer : The auditor fails to detect fraud resulting from management override of the control structure

The auditor's defense of contributory negligence is most likely to prevail when a. Third party injury has been minimal. b. The client is privately held as contrasted with a public company. c. Undetected errors have resulted in materially misleading financial statements. d. The auditor fails to detect fraud resulting from management override of the control structure.

Description : The auditor's defense of contributory negligence is most likely to prevail when a. Third party injury has been minimal. b. The client is privately held as contrasted with a public company. ... . d. The auditor fails to detect fraud resulting from management override of the control structure.

Last Answer : The auditor fails to detect fraud resulting from management override of the control structure.

Which of the following auditor concerns most likely could be so serious that the auditor concludes that a financial statement audit cannot be conducted? a. The entity has no formal written code of conduct b. The integrity of the entity’s management is suspect c. Procedures requiring segregation of duties are subject to management override d. Management fails to modify prescribed controls for changes in conditions

Description : Which of the following auditor concerns most likely could be so serious that the auditor concludes that a financial statement audit cannot be conducted? a. The entity has no formal written ... subject to management override d. Management fails to modify prescribed controls for changes in conditions

Last Answer : The integrity of the entity’s management is suspect

Anyone identified to the auditor by name prior to the audit who is to be the principal recipient of the auditor's report is a a. Primary beneficiary. b. Third party. c. Foreseen beneficiary. d. Secondary beneficiary

Description : Anyone identified to the auditor by name prior to the audit who is to be the principal recipient of the auditor's report is a a. Primary beneficiary. b. Third party. c. Foreseen beneficiary. d. Secondary beneficiary

Last Answer : Primary beneficiary

Which of the following least likely limits the auditor’s ability to detect material misstatement? a. The inherent limitations of any accounting and internal control system. b. Most audit evidences are conclusive rather than being persuasive. c. Audit is based on testing d. Audit procedures that are effective in detecting ordinary misstatements are ineffective in detecting intentional misstatements

Description : Which of the following least likely limits the auditor's ability to detect material misstatement? a. The inherent limitations of any accounting and internal control system. b ... procedures that are effective in detecting ordinary misstatements are ineffective in detecting intentional misstatements

Last Answer : Most audit evidences are conclusive rather than being persuasive

.In determining audit fees, an auditor may take into account each of the following except a. Volume and intricacy of work involved. b. Number and cost of manhours needed. c. Degree of responsibility assumed. d. Size and amount of capital of client.

Description : .In determining audit fees, an auditor may take into account each of the following except a. Volume and intricacy of work involved. b. Number and cost of manhours needed. c. Degree of responsibility assumed. d. Size and amount of capital of client.

Last Answer : Size and amount of capital of client.

Ethically, the auditor could: a. Advertise only as to his expertise in preparing income tax returns. b. Base his audit fee on a percentage of the proceeds of his client’s stock issue. c. Perform an examination for a financially distressed client at less than his customary fees. d. Own preferred stock in a corporation which is an audit client.

Description : Ethically, the auditor could: a. Advertise only as to his expertise in preparing income tax returns. b. Base his audit fee on a percentage of the proceeds of his client's stock issue. c. Perform ... at less than his customary fees. d. Own preferred stock in a corporation which is an audit client.

Last Answer : Perform an examination for a financially distressed client at less than his customary fees.

Which of the following best describes the purpose of the engagement letter? a. The engagement letter conveys to management the detailed steps to be applied in the audit process. b. The engagement letter relieves the auditor of some responsibility for the exercise of due care. c. By clearly defining the nature of the engagement, the engagement letter helps avoid and resolve misunderstandings between CPA andclient regarding the precise nature of the work to be performed and the type of report to be issued. d. The engagement letter should be signed by both the client and the CPA and should be used only for independent audits

Description : Which of the following best describes the purpose of the engagement letter? a. The engagement letter conveys to management the detailed steps to be applied in the audit process. b. The engagement letter ... be signed by both the client and the CPA and should be used only for independent audits

Last Answer : By clearly defining the nature of the engagement, the engagement letter helps avoid and resolve misunderstandings between CPA and client regarding the precise nature of the work to be performed and the type of report to be issued

If the auditor is convinced that the client has an excellent internal control structure, the amount of audit evidence to be gathered. a. Can be significantly less than where internal control is not adequate. b. Will not be affected since the auditor must arrive at an independently determined opinion. c. Must be increased to support the auditor's belief. d. Is not determinable

Description : If the auditor is convinced that the client has an excellent internal control structure, the amount of audit evidence to be gathered. a. Can be significantly less than where internal control is not ... determined opinion. c. Must be increased to support the auditor's belief. d. Is not determinable

Last Answer : Can be significantly less than where internal control is not adequate.

A CPA is conducting the first audit of a client’s financial statements. The CPA hopes to reduce the audit work by consulting with the predecessor auditor and reviewing the predecessor's working papers. This procedure is a. Acceptable if the CPA refers in the audit report to reliance upon the predecessor auditor's work. b. Required if the CPA is to render an unqualified opinion. c. Unacceptable because the CPA should bring an independent viewpoint to a new engagement. d. Acceptable if the client and the predecessor auditor agree to it.

Description : A CPA is conducting the first audit of a client's financial statements. The CPA hopes to reduce the audit work by consulting with the predecessor auditor and reviewing the predecessor's working papers. ... to a new engagement. d. Acceptable if the client and the predecessor auditor agree to it.

Last Answer : Acceptable if the client and the predecessor auditor agree to it.

Which of the following does an auditor least likely perform in assessing audit risk? a. Understand the economic substance of significant transactions completed by the client. b. Understand the entity and the industry in which it operates. c. Gather audit evidence in support of recorded transactions. d. Obtain an understanding of the client's system of internal contro

Description : Which of the following does an auditor least likely perform in assessing audit risk? a. Understand the economic substance of significant transactions completed by the client. b. Understand the entity ... of recorded transactions. d. Obtain an understanding of the client's system of internal contro

Last Answer : Gather audit evidence in support of recorded transactions

Inquiries directed towards those charged with governance may most likely a. Relate to their activities concerning the design, and effectiveness of the entity's internal control and whether management has satisfactorily responded to any findings from these activities. b. Help the auditor understand the environment in which the financial statements are prepared. c. Relate to changes in the entity's marketing strategies, sales trends, or contractual arrangements with its customers. d. Help the auditor in evaluating the appropriateness of the selection and application of certain accounting policies

Description : Inquiries directed towards those charged with governance may most likely a. Relate to their activities concerning the design, and effectiveness of the entity's internal control and ... the auditor in evaluating the appropriateness of the selection and application of certain accounting policies

Last Answer : Help the auditor understand the environment in which the financial statements are prepared.