Which of the following is incorrect about responsibility for financial statements? a. Management is responsible for fair presentation of the financial statements. b. Auditor is responsible for expressing an opinion on the financial statements. c. Audit of financial statements does not reduce management's responsibility. d. Fair presentation of financial statements is an implicit part of the auditor's responsibility

Which of the following is incorrect about
responsibility for financial statements?
a. Management is responsible for fair
presentation of the financial
statements.
b. Auditor is responsible for expressing an
opinion on the financial statements.
c. Audit of financial statements does not
reduce management's responsibility.
d. Fair presentation of financial
statements is an implicit part of the
auditor's responsibility
by

1 Answer

Answer :

Fair presentation of financial
statements is an implicit part of the
auditor's responsibility
by

Related questions

The best statement of the responsibility of the auditor with respect to audited financial statement is: a. The auditor's responsibility on fair presentation of financial statements is limited only up to the date of the audit report. b. The auditor's responsibility is confined to the expression of opinion on the financial statements audited. c. The responsibility over the financial statements rests with the management and the auditor assumes responsibility with respect to the notes of financial statements. d. The auditor is responsible only to his qualified opinion but not for any other type of opinion.

Description : The best statement of the responsibility of the auditor with respect to audited financial statement is: a. The auditor's responsibility on fair presentation of financial statements is limited only up to ... auditor is responsible only to his qualified opinion but not for any other type of opinion.

Last Answer : The auditor's responsibility is confined to the expression of opinion on the financial statements audited

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.

Which of the following statements is correct concerning an auditor's responsibilities regarding financial statements? a. The auditor's report should provide an assurance as to the future viability of the entity. b. Making suggestions that are adopted about the form and content of an entity's financial statements impairs an auditor's independence. c. An auditor's responsibilities for audited financial statements are confined to the expression of the auditor's opinion. d. The fair presentation of audited financial statements in accordance with an applicable financial reporting framework is an implicit part of the auditor's responsibilities

Description : Which of the following statements is correct concerning an auditor's responsibilities regarding financial statements? a. The auditor's report should provide an assurance as to the future ... with an applicable financial reporting framework is an implicit part of the auditor's responsibilities

Last Answer : An auditor's responsibilities for audited financial statements are confined to the expression of the auditor's opinion

The purpose of an audit of financial statements is to a. Obtain an absolute level of assurance that the financial statements as a whole are free from material misstatement. b. Relieve management or those charged with governance of the responsibility for the preparation and presentation of the financial statements in accordance with the applicable financial reporting framework. c. Enhance the degree of confidence of intended users in the financial statements. d. Assure the future viability of the entity by expressing an opinion on the entity's financial statements.

Description : The purpose of an audit of financial statements is to a. Obtain an absolute level of assurance that the financial statements as a whole are free from material misstatement. b. Relieve management ... the future viability of the entity by expressing an opinion on the entity's financial statements.

Last Answer : Enhance the degree of confidence of intended users in 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.

The Philippine Standards on Auditing issued by AASC a. Need to be applied on all audit related. b. Require that in no circumstances would an auditor may judge it necessary to depart from a PSA, even though such a departure may result to more effective achievement of the objective of an audit. c. Apply to independent examination of financial statements of any entity when such an examination is conducted for the purpose of expressing an opinion. d. Must not apply to other related activities of auditors

Description : The Philippine Standards on Auditing issued by AASC a. Need to be applied on all audit related. b. Require that in no circumstances would an auditor may judge it necessary to depart from a PSA, ... for the purpose of expressing an opinion. d. Must not apply to other related activities of auditors

Last Answer : Apply to independent examination of financial statements of any entity when such an examination is conducted for the purpose of expressing an opinion.

The Philippine Standards on Auditing issued by AASC: a. Apply to independent examination of financial statements of any entity when such an examination is conducted for the purpose of expressing an opinion. b. Need to be applied on all audit related. c. Must not apply to other related activities of auditors. d. Require that in no circumstances would an auditor may judge it necessary to depart from a PSA, even though such a departure may result to more effective achievement of the objective of an audit

Description : The Philippine Standards on Auditing issued by AASC: a. Apply to independent examination of financial statements of any entity when such an examination is conducted for the purpose of expressing an ... though such a departure may result to more effective achievement of the objective of an audit

Last Answer : Apply to independent examination of financial statements of any entity when such an examination is conducted for the purpose of expressing an opinion

Which of the following statements reflects an auditor's responsibility for detecting fraud and error? a. An auditor is responsible for detecting employee errors and simple fraud, but not for discovering fraud involving employee collusion or management overrideAn auditor should design the auditto provide reasonable assurance ofdetecting errors and fraud that arematerial to the financial statements.c. An auditor should plan the audit to detecterrors and fraud that are caused bydepartures from the applicable FRF.d. An auditor is not responsible fordetecting errors and fraud unless theapplication of PSAs and PAPs would resultin such detection

Description : Which of the following statements reflects an auditor's responsibility for detecting fraud and error? a. An auditor is responsible for detecting employee errors and simple fraud, but not for ... detecting errors and fraud unless the application of PSAs and PAPs would result in such detection

Last Answer : An auditor should design the audit to provide reasonable assurance of detecting errors and fraud that are material to the financial statements.

Which of the following statements is incorrect about materiality? a. The concept of materiality recognizes that some matters are important for fair presentation of financial statements in conformity with GAAP, while other matters are not important. b. An auditor considers materiality for planning purposes in terms of the largest aggregate level of misstatements that could be material to any one of the financial statements. c. Materiality judgments are made in light of surrounding circumstances and necessarily involve both quantitative and qualitative judgments. d. An auditor’s consideration of materiality is influenced by the auditor’s perception of the needs of a reasonable person who will rely on the financial statements

Description : Which of the following statements is incorrect about materiality? a. The concept of materiality recognizes that some matters are important for fair presentation of financial statements in conformity with ... s perception of the needs of a reasonable person who will rely on the financial statements

Last Answer : An auditor considers materiality for planning purposes in terms of the largest aggregate level of misstatements that could be material to any one of the financial statements

A principal purpose of a letter of representation from management is to a. Remind management of its primary responsibility for financial statements. b. Serve as an introduction to company personnel and an authorization to examine the records. c. Discharge the auditor from legal liability for his examination. d. Confirm in writing management's approval of limitations on the scope of the audit

Description : A principal purpose of a letter of representation from management is to a. Remind management of its primary responsibility for financial statements. b. Serve as an introduction to company personnel and ... . d. Confirm in writing management's approval of limitations on the scope of the audit

Last Answer : Remind management of its primary responsibility for financial statements.

A principal purpose of a letter of representation from management is to a. Serve as an introduction to company personnel and an authorization to examine the records. b. Discharge the auditor from legal liability for his examination. c. Confirm in writing management's approval of limitations on the scope of the audit. d. Remind management of its primary responsibility for financial statements.

Description : A principal purpose of a letter of representation from management is to a. Serve as an introduction to company personnel and an authorization to examine the records. b. Discharge the auditor ... the scope of the audit. d. Remind management of its primary responsibility for financial statements.

Last Answer : Remind management of its primary responsibility for financial statements.

The auditor gives an audit opinion on the fair presentation of the financial statements and associates his or her name with them when, on the basis of adequate evidence, the auditor concludes that the financial statements are unlikely to mislead a. A prudent user. b. Management. c. The reader. d. Investors

Description : The auditor gives an audit opinion on the fair presentation of the financial statements and associates his or her name with them when, on the basis of adequate evidence, the auditor concludes that the financial ... are unlikely to mislead a. A prudent user. b. Management. c. The reader. d. Investors

Last Answer : A prudent user.

Which of the following statements about independent financial statement audit is incorrect? a. The term "scope of the audit" refers to audit procedures deemed necessary ithe circumstances to achieve the objective of the audit. b. The auditor's opinion enhances the credibility of the financial statements. c. The phrase used to express the auditor's opinion is "present fairly, in all material respects". d. The risk that the auditor will fail to uncover material misstatement is eliminated when the auditor conducts the audit in accordance with PSAs.n

Description : Which of the following statements about independent financial statement audit is incorrect? a. The term "scope of the audit" refers to audit procedures deemed necessary in the circumstances ... uncover material misstatement is eliminated when the auditor conducts the audit in accordance with PSAs.

Last Answer : The risk that the auditor will fail to uncover material misstatement is eliminated when the auditor conducts the audit in accordance with PSAs.

Which of the following is correct concerning requirements about auditor's communications about fraud? a. Fraud that involves senior management should be reported directly to the audit committee regardless of the amounts involved. b. All fraud with a material effect on the financial statements should be reported directly by the auditor to the SEC c. Fraud with a material effect on the financial statements should ordinarily be disclosed by the auditor through the use of an emphasis of a matter paragraph added to the audit report. d. The auditor has no responsibility to disclose fraud outside the entity under any circumstances

Description : Which of the following is correct concerning requirements about auditor's communications about fraud? a. Fraud that involves senior management should be reported directly to the audit committee ... . The auditor has no responsibility to disclose fraud outside the entity under any circumstances

Last Answer : Fraud that involves senior management should be reported directly to the audit committee regardless of the amounts involved

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.

The phrase in our opinion in the auditor’s report is intended to inform users that auditors a. Guarantee fair presentation of the financial statements. b. Act as insurers of the accuracy of the financial statements. c. Certify the material presented in the statements by management. d. Based their conclusions about the statements on professional judgment

Description : The phrase in our opinion in the auditor's report is intended to inform users that auditors a. Guarantee fair presentation of the financial statements. b. Act as insurers of the ... presented in the statements by management. d. Based their conclusions about the statements on professional judgment

Last Answer : Based their conclusions about the statements on professional judgment

The responsibility for adopting sound accounting policies, maintaining adequate internal control, and making fair representations in the financial statements rests a. With the management. b. With the independent auditor. c. Equally with management and the auditor. d. With the internal audit department.

Description : The responsibility for adopting sound accounting policies, maintaining adequate internal control, and making fair representations in the financial statements rests a. With the management. b. With the independent ... c. Equally with management and the auditor. d. With the internal audit department.

Last Answer : With the management

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.

Which of the following statements about fraud or error is incorrect? a. The responsibility for the prevention and detection of fraud and error rests with management. b. The auditor should plan and perform the audit with an attitude of professional skepticism, recognizing that conditions or events may be found that fraud or error may exist. c. The likelihood of detecting fraud is ordinarily higher than that of detecting error. d. The auditor is not and can not be held responsible for the prevention of fraud and error

Description : Which of the following statements about fraud or error is incorrect? a. The responsibility for the prevention and detection of fraud and error rests with management. b. The auditor should plan and perform ... . The auditor is not and can not be held responsible for the prevention of fraud and error

Last Answer : The likelihood of detecting fraud is ordinarily higher than that of detecting error.

Which of the following statements is true? a. An independent auditor must be a CPA. b. Compliance audits are conducted to determine adherence to rules and regulations set by the auditor. c. An audit, if properly conducted, ensures that fraud is prevented. d. After conducting an audit and release of the auditor’s report, the primary responsibility on the fairness of the financial statements is shifted to the auditor

Description : Which of the following statements is true? a. An independent auditor must be a CPA. b. Compliance audits are conducted to determine adherence to rules and regulations set by the auditor. c. ... s report, the primary responsibility on the fairness of the financial statements is shifted to the auditor

Last Answer : An independent auditor must be a CPA.

By providing high level of assurance on audit reports on financial statements, the auditor a. Guarantees the fair presentation of the financial statements. b. Confirms the accuracy of the financial statements. c. Enhances the credibility of the financial statements. d. Assures the readers that fraudulent activities of employees have been detected.

Description : By providing high level of assurance on audit reports on financial statements, the auditor a. Guarantees the fair presentation of the financial statements. b. Confirms the accuracy of the ... financial statements. d. Assures the readers that fraudulent activities of employees have been detected.

Last Answer : Enhances the credibility of the financial statements.

Management’s attitude toward aggressive financial reporting and its emphasis onmeeting projected profit goals most likelywould significantly influence an entity’scontrol environment when a. External policies established by partiesoutside the entity affect its accountingpractices. b. Management is dominated by oneindividual who is also a shareholder. c. Internal auditors have direct access tothe board of directors and the entity’smanagement. d. The audit committee is active inoverseeing the entity’s financialreporting policies

Description : Management's attitude toward aggressive financial reporting and its emphasis on meeting projected profit goals most likely would significantly influence an entity's control environment when a. External ... d. The audit committee is active in overseeing the entity's financial reporting policies

Last Answer : Management is dominated by one individual who is also a shareholder

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

The primary purpose of an independent financial statement audit is to a. Provide a basis for assessing management's performance b. Comply with government regulatory requirements c. Assure management that the financial statements are unbiased and free from material error d. Provide users with an unbiased opinion about the fairness of information reported in the financial statements

Description : The primary purpose of an independent financial statement audit is to a. Provide a basis for assessing management's performance b. Comply with government regulatory requirements c. Assure ... users with an unbiased opinion about the fairness of information reported in the financial statements

Last Answer : Provide users with an unbiased opinion about the fairness of information reported in the financial statements

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 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

Why does a company choose to have an independent auditor report on its financial statements? a. Independent auditors will always detect management fraud. b. Independent auditors guarantee the accuracy of the financial statements. c. The company preparing the statements may have a vested interest in reporting certain results. d. An independent audit is designed to search for deficiencies in the company's internal control

Description : Why does a company choose to have an independent auditor report on its financial statements? a. Independent auditors will always detect management fraud. b. Independent auditors guarantee the accuracy ... . An independent audit is designed to search for deficiencies in the company's internal control

Last Answer : The company preparing the statements may have a vested interest in reporting certain results.

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

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

Which of the following best describes the operational audit? a. It requires the constant review by internal auditors of the administrative controls as they relate to operations othe company. b. It concentrates on implementing financial and accounting control in a newly organized company. c. It concentrates on seeking out aspects of operations in which waste would be reduced by the introduction of controls. d. It attempts and is designed to verify the fair presentation of a company's results of operations.f

Description : Which of the following best describes the operational audit? a. It requires the constant review by internal auditors of the administrative controls as they relate to operations ofthe company. b. It ... attempts and is designed to verify the fair presentation of a company's results of operations.

Last Answer : It concentrates on seeking out aspects of operations in which waste would be reduced by the introduction of controls

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

Professional judgment:a. Is not used in making decisions about materiality and audit risk. b. Is necessary in the evaluation of management's judgments in applying the entity's applicable financial reporting framework. c. Should be exercised in planning and performing an audit of financial statements but need not be documented. d. Can be used as the justification for the decisions made by the auditor that are not supported by the facts and circumstances of the engagement

Description : Professional judgment:a. Is not used in making decisions about materiality and audit risk. b. Is necessary in the evaluation of management's judgments in applying the entity's applicable financial ... made by the auditor that are not supported by the facts and circumstances of the engagement

Last Answer : Is necessary in the evaluation of management's judgments in applying the entity's applicable financial reporting framework

Which of the following is considered a primary reason for creating an internal audit department? a. To safeguard resources entrusted to the organization. b. To evaluate and improve the effectiveness of control processes. c. To ensure the accuracy, reliability, and timeliness of financial and operating data used in management's decision making. d. To relieve management of the responsibility for establishing effective controls

Description : Which of the following is considered a primary reason for creating an internal audit department? a. To safeguard resources entrusted to the organization. b. To evaluate and improve the ... 's decision making. d. To relieve management of the responsibility for establishing effective controls

Last Answer : To evaluate and improve the effectiveness of control processes.

.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

Which of the following statements is correct relating to the auditor’s consideration of fraud? a. The auditor’s interest in fraud consideration relates to fraudulent acts that cause a material misstatement of financial statements. b. A primary factor that distinguishes fraud from error is that fraud is always intentional, while errors are generally, but not always, intentional. c. While an auditor should be aware of the possibility of fraud, management, and not the auditor, is responsible for detecting fraud. d. Fraud always involves a pressure or incentive to commit fraud, and a misappropriation of assets

Description : Which of the following statements is correct relating to the auditor's consideration of fraud? a. The auditor's interest in fraud consideration relates to fraudulent acts that cause a material ... d. Fraud always involves a pressure or incentive to commit fraud, and a misappropriation of assets

Last Answer : The auditor’s interest in fraud consideration relates to fraudulent acts that cause a material misstatement of financial statements.

The independent auditor lends credibility to client financial statements by a. Stating in the auditor’s management letter that the examination was made in accordance with PSAs b. Attaching an auditor’s opinion to the client’s financial statements. c. Testifying under oath about client financial statements. d. Maintaining clear-cut distinctions between management representations and auditor’s representations.

Description : The independent auditor lends credibility to client financial statements by a. Stating in the auditor's management letter that the examination was made in accordance with PSAs b. ... statements. d. Maintaining clear-cut distinctions between management representations and auditor's representations.

Last Answer : Attaching an auditor’s opinion to the client’s financial statements.

Which of the following has the primary responsibility for the fairness of the representations made in the financial statements? a. Audit committee b. Client's management c. Independent auditor d. Board of Accountancy

Description : Which of the following has the primary responsibility for the fairness of the representations made in the financial statements? a. Audit committee b. Client's management c. Independent auditor d. Board of Accountancy

Last Answer : Client's management

The management responsibility to detect and prevent fraud and error is accomplished by a. Having an annual audit of financial statements. b. Implementing adequate quality control system. c. Implementing adequate accounting and internal control system. d. Issuing a representation letter to the auditor.

Description : The management responsibility to detect and prevent fraud and error is accomplished by a. Having an annual audit of financial statements. b. Implementing adequate quality control system. c. ... adequate accounting and internal control system. d. Issuing a representation letter to the auditor.

Last Answer : Implementing adequate accounting and internal control system

The auditor has considerable responsibility for notifying users as to whether or not the statements are properly stated. This imposes upon the auditor a duty to a. Provide reasonable assurance that material misstatements will be detected. b. Be an insurer of the fairness in the statements. c. Be a guarantor of the fairness in the statements. d. Be equally responsible with management for the preparation of the financial statements

Description : The auditor has considerable responsibility for notifying users as to whether or not the statements are properly stated. This imposes upon the auditor a duty to a. Provide reasonable assurance ... statements. d. Be equally responsible with management for the preparation of the financial statements

Last Answer : Provide reasonable assurance that material misstatements will be detected.