Auditors perform analytical procedures in the planning stage of an audit for the purpose of: a. Determining which of the financial statement assertions are the most important for the client's financial statements. b. Determining the nature, timing, and extent of audit procedures for auditing the inventory. c. Deciding the matters to cover in an engagement. d. Identifying unusual conditions that deserve more auditing effort

Auditors perform analytical procedures in
the planning stage of an audit for the
purpose of:
a. Determining which of the financial
statement assertions are the most
important for the client's financial
statements.
b. Determining the nature, timing, and
extent of audit procedures for auditing
the inventory.
c. Deciding the matters to cover in an
engagement.
d. Identifying unusual conditions that
deserve more auditing effort
by

1 Answer

Answer :

Identifying unusual conditions that
deserve more auditing effort
by

Related questions

Internal auditing can affect the scope of the external auditor's audit of financial statements by a. Decreasing the external auditor's need to perform detailed testsb. Eliminating the need to observe thephysical inventory taking.c. Allowing the external auditor to limithis/her audit to the performance ofsubstantive test procedures.d. Limiting direct testing by the externalauditor to management assertions notdirectly tested by internal auditing.

Description : Internal auditing can affect the scope of the external auditor's audit of financial statements by a. Decreasing the external auditor's need to perform detailed tests b. Eliminating the need ... direct testing by the external auditor to management assertions not directly tested by internal auditing.

Last Answer : Decreasing the external auditor's need to perform detailed tests

The element of the audit planning process most likely to be agreed upon with the client before implementation of the audit strategy is the determination of the a. Procedures to be undertaken to discover litigation, claims, and assessments. b. Timing of inventory observation procedures to be performed. c. Evidence to be gathered to provide asufficient basis for the auditor's opinion.d. Pending legal matters to be included inthe inquiry of the client's attorney.

Description : The element of the audit planning process most likely to be agreed upon with the client before implementation of the audit strategy is the determination of the a. Procedures to be undertaken to discover ... opinion. d. Pending legal matters to be included in the inquiry of the client's attorney.

Last Answer : Timing of inventory observation procedures to be performed

The element of the audit planning process most likely to be agreed upon with the client before implementation of the audit strategy is the determination of the a. Timing of inventory observation procedures to be performedb. Evidence to be gathered to provide asufficient basis for the auditor's opinion.c. Procedures to be undertaken to discoverlitigation, claims, and assessments.d. Pending legal matters to be included inthe inquiry of the client's attorney

Description : The element of the audit planning process most likely to be agreed upon with the client before implementation of the audit strategy is the determination of the a. Timing of inventory observation ... assessments. d. Pending legal matters to be included in the inquiry of the client's attorney

Last Answer : Timing of inventory observation procedures to be performed.

Which statement is correct regarding the relationship between internal auditing and the external auditor? a. Some judgments relating to the audit of the financial statements are those of the internal auditor. b. The external audit function's objectives vary according to management's requirements. c. Certain aspects of internal auditing may be useful in determining the nature, timing and extent of external audit procedures. d. The external auditor is responsible for the audit opinion expressed, however that responsibility may be reduced by any use made of internal auditing

Description : Which statement is correct regarding the relationship between internal auditing and the external auditor? a. Some judgments relating to the audit of the financial statements are those of the ... opinion expressed, however that responsibility may be reduced by any use made of internal auditing

Last Answer : Certain aspects of internal auditing may be useful in determining the nature, timing and extent of external audit procedures.

With respect to the auditor's planning of a year-end examination, which of the following statements is always true? a. An engagement should not be accepted after the fiscal year-end. b. It is an acceptable practice to carry out substantial parts of the examination at interim dates. c. An inventory count must be observed at the balance sheet date. d. The client's audit committee should not be told of the specific audit procedures that will be performed

Description : With respect to the auditor's planning of a year-end examination, which of the following statements is always true? a. An engagement should not be accepted after the fiscal year-end. b. It ... . The client's audit committee should not be told of the specific audit procedures that will be performed

Last Answer : It is an acceptable practice to carry out substantial parts of the examination at interim dates

The external auditor should obtain a sufficient understanding of the internal audit function because a. The understanding of the internal audit function is an important substantive test to be performed by the external auditor. b. The audit programs, working papers, and reports of internal auditors may often be used as a substitute for the work of the external auditor's staff. c. The procedures performed by the internal audit staff may eliminate the external auditor's need for considering internal control. d. The work performed by internal auditors may be a factor in determining the nature, timing, and extent of the external auditor's procedures.

Description : The external auditor should obtain a sufficient understanding of the internal audit function because a. The understanding of the internal audit function is an important substantive test to be performed by ... factor in determining the nature, timing, and extent of the external auditor's procedures.

Last Answer : The work performed by internal auditors may be a factor in determining the nature, timing, and extent of the external auditor's procedures.

An audit plan is a a. Detailed plan of analytical procedures and all substantive tests to be performed in the course of the audit. b. Document that provides an overview of the company and a general plan for the audit work to be accomplished, timing of the work, and other matters of concern to the audit. c. Generic document that auditing firms have developed to lead the process of the audit through a systematic and logical process. d. Budget of the time that should be necessary to complete each phase of the audit procedure

Description : An audit plan is a a. Detailed plan of analytical procedures and all substantive tests to be performed in the course of the audit. b. Document that provides an overview of the company and a ... process. d. Budget of the time that should be necessary to complete each phase of the audit procedure

Last Answer : Document that provides an overview of the company and a general plan for the audit work to be accomplished, timing of the work, and other matters of concern to the audit.

An audit plan is a a. Detailed plan of analytical proceduresand all substantive tests to be performedin the course of the audit.b. Generic document that auditing firmshave developed to lead the process ofthe audit through a systematic andlogical process.c. Budget of the time that should benecessary to complete each phase of theaudit procedures.d. Document that provides an overviewof the company and a general planfor the audit work to beaccomplished, timing of the work,and other matters of concern to theaudit

Description : An audit plan is a a. Detailed plan of analytical proceduresand all substantive tests to be performed in the course of the audit. b. Generic document that auditing firms have developed to lead the ... audit work to be accomplished, timing of the work, and other matters of concern to the audit

Last Answer : Document that provides an overview of the company and a general plan for the audit work to be accomplished, timing of the work, and other matters of concern to the audit

Management’s assertions in the financial statements are relevant to the audit process because: a. They provide evidence that auditors have prepared financial statements in accordance with GAAP b. They embody the audit procedures that will be performed by the audit engagement team. c. They include representations of financial statements in accordance with the applicable reporting criteria d. They relate to regulator’s expectations about audit results

Description : Management's assertions in the financial statements are relevant to the audit process because: a. They provide evidence that auditors have prepared financial statements in accordance with GAAP b ... with the applicable reporting criteria d. They relate to regulator's expectations about audit results

Last Answer : They include representations of financial statements in accordance with the applicable reporting criteria

Management’s assertions in the financial statements are relevant to the audit process because: a. They provide evidence that auditors have prepared financial statements in accordance with GAAP b. They embody the audit procedures that will be performed by the audit engagement team. c. They include representations of financial statements in accordance with the applicable reporting criteria d. They relate to regulator’s expectations about audit results

Description : Management's assertions in the financial statements are relevant to the audit process because: a. They provide evidence that auditors have prepared financial statements in accordance with GAAP b ... with the applicable reporting criteria d. They relate to regulator's expectations about audit results

Last Answer : They include representations of financial statements in accordance with the applicable reporting criteria

Which of the following procedures would an auditor be most likely to perform in planning a financial statement audit? a. Reviewing investment transactions of the audit period to determine whether related parties were created. b. Performing analytical procedures to identify areas that may represent specific risks. c. Obtaining a written representation letter from the client to emphasize management's responsibilities. d. Reading the minutes of stockholder and director meetings to discover whether any unusual transactions have occurred.

Description : Which of the following procedures would an auditor be most likely to perform in planning a financial statement audit? a. Reviewing investment transactions of the audit period to determine ... the minutes of stockholder and director meetings to discover whether any unusual transactions have occurred.

Last Answer : Performing analytical procedures to identify areas that may represent specific risks.

Choose one of the following which would describe best the phrase "generally accepted auditing standards": a. They identify the policies and procedures for the conduct of the audit. b. They define the nature and extent of the auditor's responsibilities. c. They provide guidance to the auditor with respect to planning the audit and writing the audit report. d. They set forth a measure a measure of the quality of the performance of audit procedures.

Description : Choose one of the following which would describe best the phrase "generally accepted auditing standards": a. They identify the policies and procedures for the conduct of the audit. b. They define the ... d. They set forth a measure a measure of the quality of the performance of audit procedures.

Last Answer : They set forth a measure a measure of the quality of the performance of audit 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.

In an engagement to perform agreed-upon procedures, an auditor is engaged to: a. Use accounting expertise as opposed to auditing expertise to collect, classify, and summarize financial information. b. Provide a moderate level of assurance that the information is free of material misstatement. c. Provide a high, but not absolute, level of assurance that the information is free of material misstatement. d. Carry out those procedures of an audit nature to which the auditor and the entity and any appropriate third parties have agreed and to report on factual findings

Description : In an engagement to perform agreed-upon procedures, an auditor is engaged to: a. Use accounting expertise as opposed to auditing expertise to collect, classify, and summarize financial information. b ... and the entity and any appropriate third parties have agreed and to report on factual findings

Last Answer : Carry out those procedures of an audit nature to which the auditor and the entity and any appropriate third parties have agreed and to report on factual findings

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

Internal auditors review the adequacy of the company's internal control system primarily to a. Help determine the nature, timing, and extent of tests necessary to achieve audit objectives. b. Determine whether the internal control system ensures that financial statements are fairly presented. c. Determine whether the internal control system provides reasonable assurance that the company's objectives and goals are met efficiently and economically. d. Ensure that material weaknesses in the system of internal control are corrected

Description : Internal auditors review the adequacy of the company's internal control system primarily to a. Help determine the nature, timing, and extent of tests necessary to achieve audit objectives. b. ... and economically. d. Ensure that material weaknesses in the system of internal control are corrected

Last Answer : Determine whether the internal control system provides reasonable assurance that the company's objectives and goals are met efficiently and economically.

As used in auditing, which of the following statements best describes "assertions”? a. Assertions are the auditor's findings to be communicated in his audit report. b. Assertions are found only in the notes to the financial statements. c. Assertions are the representations of management as to the reliability of the information system. d. Assertions are the representations of management as to the fairness of presentation of the financial statements

Description : As used in auditing, which of the following statements best describes "assertions ? a. Assertions are the auditor's findings to be communicated in his audit report. b. Assertions are ... Assertions are the representations of management as to the fairness of presentation of the financial statements

Last Answer : Assertions are the representations of management as to the fairness of presentation of the financial statements

Which of the following is an incorrect statement relating to the theoretical framework of auditing? a. Effective internal control structure reduces the probability of fraud or irregularities in an organization. b. Application of generally accepted accounting principles results in a fair presentation of financial statements. c. When examining financial data foropinion thereon, the auditor actsexclusively in the capacity of an auditor.d. In collecting evidence, auditorsshould maintain an attitude of trustabout their clients' assertions. the purpose of expressing an independent

Description : Which of the following is an incorrect statement relating to the theoretical framework of auditing? a. Effective internal control structure reduces the probability of fraud or irregularities in ... collecting evidence, auditors should maintain an attitude of trust about their clients' assertions.

Last Answer : In collecting evidence, auditors should maintain an attitude of trust about their clients' assertions.

An auditor should consider materiality when I. Determining the nature, timing, and extent of audit procedures. II. Evaluating the effect of misstatements. a. I only b. II only c. Both I and II d. Neither I nor II

Description : An auditor should consider materiality when I. Determining the nature, timing, and extent of audit procedures. II. Evaluating the effect of misstatements. a. I only b. II only c. Both I and II d. Neither I nor II

Last Answer : Both I and II

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.

In designing written audit programs, an auditor should establish specific audit objectives that relate primarily to the a. Financial statement assertions. b. Timing of audit procedures. c. Cost-benefit of gathering evidence. d. Selected audit techniques.

Description : In designing written audit programs, an auditor should establish specific audit objectives that relate primarily to the a. Financial statement assertions. b. Timing of audit procedures. c. Cost-benefit of gathering evidence. d. Selected audit techniques.

Last Answer : Financial statement assertions

In the planning stage of an audit engagement, the auditor is required to perform audit procedures to obtain an understanding of the entity and its environment, including its internal control. These procedures are called a. Substantive tests b. Tests of controls c. Risk assessment procedures d. Dual-purpose tests

Description : In the planning stage of an audit engagement, the auditor is required to perform audit procedures to obtain an understanding of the entity and its environment, including its internal control. These ... a. Substantive tests b. Tests of controls c. Risk assessment procedures d. Dual-purpose tests

Last Answer : Risk assessment procedures

To be independent, the auditor: a. Must be impartial when dealing with the client. b. Cannot place any reliance on the client's verbal and written assertions. c. Is responsible only to third-party users of the financial statements. d. Cannot perform any consulting servicesfor an audit client.

Description : To be independent, the auditor: a. Must be impartial when dealing with the client. b. Cannot place any reliance on the client's verbal and written assertions. c. Is responsible only to third-party users of the financial statements. d. Cannot perform any consulting servicesfor an audit client.

Last Answer : Must be impartial when dealing with the client

Which of the following is most likely to be a response to the auditor's assessment that the risk of material misstatement due to fraud for the existence of inventory is high? a. Observe test counts of inventory at certain locations on an unannounced basis. b. Perform analytical procedures rather than taking test counts. c. Request that inventories be counted prior to year end. d. Request that inventory counts at the various locations be counted on different dates so as to allow the same auditor to be present at every count

Description : Which of the following is most likely to be a response to the auditor's assessment that the risk of material misstatement due to fraud for the existence of inventory is high? a. Observe test counts ... be counted on different dates so as to allow the same auditor to be present at every count

Last Answer : Observe test counts of inventory at certain locations on an unannounced basis.

After studying and evaluating a client's existing internal control, an auditor has concluded that the policies and procedures are well-designed and functioning as intended. Under these circumstances, the auditor would most likely a. Perform further control tests to the extent outlined in the audit program. b. Determine the control policies and procedures that should prevent or detect errors and fraud. c. Set detection risk at a higher level than would be set under conditions of weak internal control. d. Set detection risk at a lower level than would be set under conditions of weak internal control.

Description : After studying and evaluating a client's existing internal control, an auditor has concluded that the policies and procedures are well-designed and functioning as intended. Under these circumstances, the ... risk at a lower level than would be set under conditions of weak internal control.

Last Answer : Set detection risk at a higher level than would be set under conditions of weak internal control.

The extent of audit planning will vary according to the following: a. Auditor’s experience with the entity. b. The nature and complexity of the audit engagement. c. Size of the entity. d. All of the above

Description : The extent of audit planning will vary according to the following: a. Auditor’s experience with the entity. b. The nature and complexity of the audit engagement. c. Size of the entity. d. All of the above

Last Answer : All of the above

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 statements concerning audit planning is incorrecta. Planning is a continual and iterativeprocess.b. Planning is a discrete phase of anaudit.c. In a recurring audit, planning oftenbegins shortly after (or in connectionwith) the completion of the previousaudit and continues until the completionof the current audit engagement.d. In planning an audit, the auditorconsiders the timing of certain planningactivities and audit procedures that areto be completed prior to the performanceof further audit procedures

Description : Which of the following statements concerning audit planning is incorrect a. Planning is a continual and iterative process. b. Planning is a discrete phase of an audit. c. In a recurring ... activities and audit procedures that are to be completed prior to the performance of further audit procedures

Last Answer : Planning is a discrete phase of an audit

Which of the following statements concerning consulting services is incorrect? a. The performance of consulting services for audit clients does not, in and of itself, impair the auditor's independence. b. Consulting services differ fundamentally from the CPA's function of attesting to the assertions of other parties. c. Consulting services ordinarily involve external reporting. d. Most CPAs, including those who provide audit and tax services, also provide consulting services to their clients

Description : Which of the following statements concerning consulting services is incorrect? a. The performance of consulting services for audit clients does not, in and of itself, impair the auditor's ... including those who provide audit and tax services, also provide consulting services to their clients

Last Answer : Consulting services ordinarily involve external reporting

The establishment of the overall audit strategy involves a. Determining the characteristics of the engagement that defines its scope.b. Ascertaining the reporting objectives of the engagement to plan the timing of the audit and the nature of the communications required. c. Considering the important factors that will determine the focus of the engagement team's efforts. d. All of the answers

Description : The establishment of the overall audit strategy involves a. Determining the characteristics of the engagement that defines its scope. b. Ascertaining the reporting objectives of the engagement to plan the timing ... will determine the focus of the engagement team's efforts. d. All of the answers

Last Answer : All of the answers

The establishment of an overall audit strategy involves I. Determining the characteristics of the engagement that define its scope. II. Ascertaining the reporting objectives of the engagement to plan the timing of the audit and the nature of the communications required. III. Considering the important factors that will determine the focus of the engagement team's efforts. a. I and II only b. I and III only c. II and III only d. I, II, and III

Description : The establishment of an overall audit strategy involves I. Determining the characteristics of the engagement that define its scope. II. Ascertaining the reporting objectives of the engagement to plan the timing of the audit and the ... II only b. I and III only c. II and III only d. I, II, and III

Last Answer : I, II, and III

A basic premise underlying analytical procedures is that a. The study of financial ratios is an acceptable alternative to the investigation of unusual fluctuations. b. Plausible relationships among data may reasonably be expected to exist and continue in the absence of known conditions to the contrary. c. These procedures cannot replace tests of details of transactions and balances. d. Statistical tests of financial information may lead to the detection of material misstatements in the financial statements.

Description : A basic premise underlying analytical procedures is that a. The study of financial ratios is an acceptable alternative to the investigation of unusual fluctuations. b. Plausible relationships ... financial information may lead to the detection of material misstatements in the financial statements.

Last Answer : Plausible relationships among data may reasonably be expected to exist and continue in the absence of known conditions to the contrary.

The element of the audit planning process most likely to be agreed upon with the client before implementation of the audit strategy is the determination of the a. Methods of statistical sampling to be used in confirming accounts receivable. b. Pending legal matters to be included in the inquiry of the client's attorney. c. Evidence to be gathered to provide a sufficient basis for the auditor's opinion. d. Schedules and analyses to be prepared by the client's staf

Description : The element of the audit planning process most likely to be agreed upon with the client before implementation of the audit strategy is the determination of the a. Methods of statistical sampling to be used ... for the auditor's opinion. d. Schedules and analyses to be prepared by the client's staf

Last Answer : Schedules and analyses to be prepared by the client's staf

Which of the following statements does not properly describe a limitation of an audit? a. Many audit conclusions are made on the basis of examining a sample of evidence. b. The work, under taken by the auditor is permeated by judgment. c. Fatigue and human weaknesses can cause auditors to overlook pertinent evidence. d. Many financial statement assertions cannot be audited

Description : Which of the following statements does not properly describe a limitation of an audit? a. Many audit conclusions are made on the basis of examining a sample of evidence. b. The ... weaknesses can cause auditors to overlook pertinent evidence. d. Many financial statement assertions cannot be audited

Last Answer : Fatigue and human weaknesses can cause auditors to overlook pertinent evidence

Which of the following statements does not properly describe a limitation of an audit? a. Many financial statement assertions cannot be audited. b. Many audit conclusions are made on the basis of examining a sample of evidence. c. The work, under taken by the auditor is permeated by judgment. d. Fatigue and human weaknesses can cause auditors to overlook pertinent evidence

Description : Which of the following statements does not properly describe a limitation of an audit? a. Many financial statement assertions cannot be audited. b. Many audit conclusions are made on the ... permeated by judgment. d. Fatigue and human weaknesses can cause auditors to overlook pertinent evidence

Last Answer : Fatigue and human weaknesses can cause auditors to overlook pertinent evidence

Which of the following factors would most likely cause a CPA to decide not to accept a new audit engagement? a. The CPA’s lack of understanding of the prospective client’s internal auditor’s computer-assisted audit techniques. b. Management’s disregard of its responsibility to maintain an adequate internal control environment. c. The CPA’s inability to determine whether related-party transactions were consummated on terms equivalent to arm’s-length transactions. d. Management’s refusal to permit the CPA to perform substantive tests before the year-end.

Description : Which of the following factors would most likely cause a CPA to decide not to accept a new audit engagement? a. The CPA's lack of understanding of the prospective client's internal auditor's ... . d. Management's refusal to permit the CPA to perform substantive tests before the year-end.

Last Answer : Management’s disregard of its responsibility to maintain an adequate internal control environment

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

Which of the following is an element of "directing an audit assistant" objective? a. Identifying in advance the staffing requirements of a particular audit engagement. b. Resolving any differences in professional judgment between audit personnel. c. Resolution of differences in audit findings. d. Informing assistants of their responsibilities and the objectives of the procedures they are to perform

Description : Which of the following is an element of "directing an audit assistant" objective? a. Identifying in advance the staffing requirements of a particular audit engagement. b. Resolving any ... . Informing assistants of their responsibilities and the objectives of the procedures they are to perform

Last Answer : Informing assistants of their responsibilities and the objectives of the procedures they are to perform

Which one of the following is an example of management expectations from the independent auditors? a. An expert providing a written communication as the product of the engagement. b. Individuals who perform day-to-day accounting functions on behalf of the company. C. AN active participant in management decision-making. d. An internal source of expertise on financial and other matters

Description : Which one of the following is an example of management expectations from the independent auditors? a. An expert providing a written communication as the product of the engagement. b. Individuals who ... in management decision-making. d. An internal source of expertise on financial and other matters

Last Answer : An expert providing a written communication as the product of the engagement

When a CPA is approached to perform an audit for the first time, the CPA should make inquiries of the predecessor auditor. This is a necessary procedure because the predecessor may be able to provide the successor with information that will assist the successor in determining a. Whether, in the predecessor's opinion, internal control of the company has been satisfactory. b. Whether the engagement should be accepted. c. Whether the predecessor's work should be utilized. d. Whether the company follows the policy of rotating its auditors.

Description : When a CPA is approached to perform an audit for the first time, the CPA should make inquiries of the predecessor auditor. This is a necessary procedure because the predecessor may be able to provide ... 's work should be utilized. d. Whether the company follows the policy of rotating its auditors.

Last Answer : Whether the engagement should be accepted.

A CPA establishes quality control policies and procedures for deciding whether to accept a new client or continue to perform services for a current client. The primary purpose for establishing such policies and procedures is a. To enable the auditor to attest to the integrity or reliability of a client. b. To comply with the quality control standards established by regulatory bodies. c. To minimize the likelihood of association with clients whosemanagement lacks integrity.d. To lessen the exposure to litigationresulting from failure to detectirregularities in client financialstatements

Description : A CPA establishes quality control policies and procedures for deciding whether to accept a new client or continue to perform services for a current client. The primary purpose ... resulting from failure to detect irregularities in client financial statements association with clients whose

Last Answer : To minimize the likelihood of association with clients whose management lacks integrity

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