Description : What assurance is provided by the auditor in an agreed-upon procedures engagement? a. No assurance. b. Low. c. Moderate. d. Reasonable
Last Answer : No assurance
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
Description : For assurance engagements regarding historical financial information, reasonable assurance engagements are called: a. Review engagements. b. Audit engagements. c. Compilation engagements. d. Agreed-upon procedures engagements
Last Answer : Audit engagements
Description : For assurance engagements regarding historical financial information, reasonable assurance engagements are called: a. Review engagements. b. Audit engagements. c. Compilation engagements. d. Agreed-upon procedures engagements.
Last Answer : Audit engagements.
Description : Pronouncements of Auditing and Assurance Standards Council (AASC) do not cover a. Review engagement b. Compilation engagement c. Consultancy d. Agreed-upon procedures engagement
Last Answer : Consultancy
Description : Which of the following is true of the report based on agreed-upon-procedures? a. The report is restricted to those parties who have agreed to the procedures to be performed. b. The CPA ... . d. The report should state that the procedures performed are limited to analytical procedures and inquiry
Last Answer : The report is restricted to those parties who have agreed to the procedures to be performed
Description : An engagement to perform agreed-upon procedures may involve the auditor in performing certain procedures concerning I. Individual items of financial data. II. A single financial statement. III. A complete set of financial statements. ... only b. II and III only c. I and III only d. I, II, and III
Last Answer : I, II, and III
Description : Which statement is incorrect regarding procedures and evidence obtained in a review engagement? a. The auditor should apply judgment in determining the specific nature, timing and extent of review procedures. ... the needs of those relying on that information, not to the level of assurance provided
Last Answer : There is a greater risk that misstatements will not be detected in an audit than in a review.
Description : An engagement to apply agreed-upon procedure engagement may be accepted, provided a. The CPA has audited the financial statements of the client. b. The CPA is independent with respect to the client. ... involved. d. The adequacy of the procedures to be performed will be determined by the CPA.
Last Answer : The distribution of the report will be limited only to specified parties involved.
Description : Which of the following is incorrect regarding the Philippine Standards on Assurance Engagements (PSAE)? a. It provides an overall framework for assurance engagements intended to provide either a high or ... level of assurance. d. If no specific standards exist for an assurance engagement, PSAE apply
Last Answer : It provides basic principles and essential procedures for engagements intended to provide a moderate level of assurance.
Description : The level of assurance provided by a professional accountant on an audit report is: a. Low b. Reasonable c. Moderate d. None
Last Answer : Reasonable
Description : Which of the following statements best describes the auditor's responsibility regarding the detection of material errors and frauds? a. The auditor is responsible for the failure to detect material ... unrecorded transactions even if there is no evidence that material errors and frauds may exist
Last Answer : The audit should be designed to provide reasonable assurance that material errors and frauds are detected
Description : Which of the following statements best describes the auditor's responsibility to detect material errors and fraud? a. The auditor is responsible for the failure to detect material errors and ... detect unrecorded transactions even if there is no evidence that material errors and frauds may exis
Last Answer : The audit should be designed to provide reasonable assurance that material errors and fraud are detected.
Description : Assurance engagement include the following, except a. An engagement conducted to provide a high level of assurance that the subject matter conforms in all material respects with identified suitable ... Philippine Standard on Assurance Engagement(s). d. An engagement to perform agreedupon procedures
Last Answer : An engagement to perform procedures.
Description : Non-assurance engagements include all of the following except a. Compliance audit. b. Management consulting. c. Agreed-upon procedures. d. Preparation of tax returns where no conclusion is expressed.
Last Answer : Compliance audit.
Description : The term "accountant" has been used by Auditing and Assurance Standards Council to refer to a CPA in public practice who is engaged to: a. Audit financial statements. b. Review financial statements. c. Apply agreed-upon procedures. d. Compile financial statements
Last Answer : Compile financial statements
Description : The term "accountant" has been used by Auditing and Assurance Standards Council to refer to a CPA in public practice who is engaged to: a. Audit financial statements. b. Review financial statements. c. Apply agreed-upon procedures. d. Compile financial statements.
Last Answer : Compile financial statements.
Description : Non-assurance engagements include all of the following services, except: a. Agreed-upon procedures engagements. b. Compilations of financial or other information. c. Management and tax consulting. d. Examination of prospective financial information
Last Answer : Examination of prospective financial information
Description : Engagements frequently performed by professional accountants that are not assurance engagements include the following except a. Compilation b. Agreed-upon procedures. c. Compliance audit d. Management consulting
Last Answer : Compliance audit
Description : Distribution of a report is always restricted when a. Negative assurance is given. b. A review has been performed. c. There is a positive expression of opinion. d. Agreed-upon procedures have been performed
Last Answer : Agreed-upon procedures have been performed
Description : The Philippine Standards on Assurance Engagements (PSAEs) are to be applied in a. The audit or review of historical financial information. b. Assurance engagements dealing with ... information. d. Assurance engagements dealing with subject matters other than historical financial information.
Last Answer : Assurance engagements dealing with subject matters other than historical financial information.
Description : After an auditor had been engaged to perform the first audit for a nonpublic entity, the client requested to change the engagement to a review. In which of the following situations would ... determined that an unqualified opinion was warranted, but there was a disagreement concerning the audit fee.
Last Answer : The client's bank required an audit before committing to a loan, but the client subsequently acquired alternative financing.
Description : A report on factual findings is the end product of the auditor when performing: a. Audit. b. Review. c. Agreed-upon procedures. d. Compilation
Last Answer : Agreed-upon procedures
Description : A report on factual findings is the end product of the auditor when performing: a. Audit. b. Review. c. Agreed-upon procedures. d. Compilation.
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.
Description : Which of the following statements is true? a. Assurance engagements do not require independence. b. The term auditor is broader in scope compared to the term practitioner. c. Assurance ... be provided by the practitioner is inversely related to the scope of procedures performed and their results
Last Answer : Assurance engagements performed by professional accountants are intended to enhance the credibility of information.
Description : Reasonable assurance means: a. Gathering of all available corroborating evidence for the auditor to conclude that there are no material misstatements in the financial statements, taken as a whole. ... necessary for the auditor to conclude that there are no material misstatements in the financial
Last Answer : Gathering of the audit evidence necessary for the auditor to conclude that there are no material misstatements in the financial statements, taken as a whole
Description : Upon completion of a typical audit, the auditor has a. No assurance that all material errors and fraud have been found. b. A low level of assurance that all material errors and fraud have been ... errors and fraud have been found. d. Total assurance that al material errors and fraud have been found
Last Answer : High level of assurance that all material errors and fraud have been found.
Description : What type of assurance engagement is involved when the practitioner expresses a negative form of conclusion? a. Negative assurance engagement b. Assertion-based assurance engagement c. Limited assurance engagement d. Reasonable assurance engagement
Last Answer : Limited assurance engagement
Description : What type of assurance engagement is involved when the practitioner expresses a positive form of conclusion? a. Positive assurance engagement b. Limited assurance engagement c. Reasonable assurance engagement d. Absolute assurance engagement
Last Answer : Reasonable assurance engagement
Description : A process comprising an ongoing consideration and evaluation of the firm's system of quality control, including a periodic inspection of a selection of completed engagements, designed to enable the firm ... effectively. a. Inspection b. Monitoring c. Peer review d. Engagement quality control review
Last Answer : Monitoring
Description : The firm should establish a system of quality control designed to provide it with reasonable assurance regarding: a. Compliance with professional standards b. Compliance with regulatory and legal requirements c. Appropriateness of reports issued by the firm or engagement partners d. All of the above
Last Answer : All of the above
Description : Which of the following statements is correct concerning the auditor's responsibility with respect to illegal acts? a. An auditor must design tests to detect both direct-effect and indirect- ... auditor must design tests to detect both material direct-effect and material indirect-effect illegal acts
Last Answer : An auditor must design tests to obtain reasonable assurance of detecting material direct-effect illegal acts.
Description : Which of the following statements is incorrect? a. In an audit, the independent auditor attempts to corroborate assertions made by the company's management in connection with each account, class ... assurance that material misstatements do not exist in any of the assertions made by management.
Last Answer : Because of the attest functionfinancial statements are the responsibility of the independent audito
Description : Which of the following statements reflects an auditor's responsibility for detecting misstatements due to errors and fraud? a. An auditor is responsible for detecting employee errors and simple fraud, ... due to errors and fraud unless the application of GAAS would result in such detection.
Last Answer : An auditor should design the audit to provide reasonable assurance of detecting misstatements due to errors and fraud that are material to the financial statements.
Description : What is the responsibility of an auditor who is engaged to audit the financial statements of a government entity? a. Assess control risk with respect to each component of internal ... the statements are free of material misstatements resulting from illegal acts having direct or indirect effects
Last Answer : Obtain an understanding of the possible financial statement effects of laws and regulations having direct and material effects on amounts reported.
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.
Description : The objective of quality control mandates that a public accounting firm should establish policies and procedures for professional development which provide reasonable assurance that all entry-level ... accounting. d. Have the knowledge required to enable them to fulfill responsibilities assigned
Last Answer : Have the knowledge required to enable them to fulfill responsibilities assigned
Description : Which of the following is incorrect regarding a compilation engagement? a. The CPA uses his auditing expertise to collect, classify and summarize financial information. b. The CPA should exercise due ... . d. The procedures performed do not enable the accountant to express any form of assurance.
Last Answer : The CPA uses his auditing expertise to collect, classify and summarize financial information
Description : Which of the following is incorrect regarding a compilation engagement? a. The CPA uses his auditing expertise to collect, classify and summarize financial information. b. The CPA should exercise due ... form. d. The procedures performed do not enable the accountant to express any form of assurance
Last Answer : The CPA uses his auditing expertise to collect, classify and summarize financial information.
Description : The Philippine Framework for Assurance Engagements a. Provides a frame of reference for CPAs in public practice when performing audits, reviews, and compilations of historical financial information. b. ... of an assurance engagement, and identifies engagements to which PSAs, PSREs, and PSAEs apply
Last Answer : Defines and describes the elements and objectives of an assurance engagement, and identifies engagements to which PSAs, PSREs, and PSAEs apply
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.
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
Description : Which of the following matters would an auditor most likely consider when establishing the scope of the audit? a. Audit areas where there is a higher risk of material misstatement. ... status of audit work throughout the engagement and the expected deliverables resulting from the audit procedures.
Last Answer : The expected audit coverage, including the number and locations of the entity's components to be included.
Description : In planning the audit engagement, the auditor should consider each of the following, except a. Matters relating to the entity's business and the industry in which it operates. b. Materiality level and ... or adverse) that is likely to be expressed. d. The entity's accounting policies and procedures.
Last Answer : The kind of opinion (unmodified, qualified, or adverse) that is likely to be expressed
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
Description : Audit programs are modified to suit the circumstances on particular engagements. A complete audit program for an engagement generally should be developed a. Prior to beginning the actual audit work. ... the client's accounting records and procedures. d. When the audit engagement letter is prepared
Last Answer : After the auditor has completed an evaluation of the existing internal accounting contro
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