Question;ACC 491;Final Exam;1) If reported sales for 2010 erroneously include sales that occur;in 2011, the assertion violated on the 2010 statements would be;2) The rights and obligations assertion applies to;3) Which of the following assertions is NOT made by management in;placing an item in the financial statements?;4) Section 11 of the Securities Act of 1933 uses the term material;fact to limit the amount of information required. Under the Act, the standard;used to determine an item?s materiality;5) Individuals or entities the auditor knew or should have known;and would rely on the audit report in making business and investment decisions;are;6) Section 18 liability is relatively narrow in scope because it;relates to a false or misleading statement in documents filed with the;7) Within generally accepted auditing standards, general standards;relate primarily to;8) Statements on auditing standards (SAS) are interpretations of;what?;9) Which of the following best describes the relationship that;should exist between the external auditor and the management of the client;company?;10) Statement on Quality Control Standards No. 2 identifies;certain quality control elements that should be considered when performing;which types of services?;11) Internal auditors are primarily involved with;12) The Government Accounting Office reports directly to the;13) With respect to audit objectives, the term validity relates to;which of the assertions below?;14) Which of the following procedures consists of seeking;information from knowledgeable persons throughout or outside the entity?;15) Specific audit objectives are normally;16) The assessment of inherent risk requires considering matters;that have a pervasive effect on assertions for all or many accounts and matters;that may pertain only to assertions for specific accounts. Which of the;following is an example of a pervasive effects matter?;17) The assessment of inherent risk requires considering matters;that have a pervasive effect on assertions for all or many accounts and matters;that may pertain only to assertions for specific accounts. Which of the;following is an example of a specific account matter?;18) The risk that the auditor may unknowingly fail to;appropriately modify his or her opinion on financial statements that are;materially misstated is;19) In accepting an engagement, an auditor takes on professional;responsibilities to;20) In communicating with the previous auditor, the potential;successor should make specific and reasonable inquiries regarding matters that;may affect the decision to accept the engagement. Which of the following items;is least likely to be included in the inquiries?;21) The importance of the accept/reject decision for a particular;client is reflected in the inclusion of acceptance and continuation of clients;as;22) In making preliminary judgments about materiality, the auditor;initially determines the aggregate level of materiality for each statement. For;planning purposes, the auditor should use the;23) Professional standards recognize that a misstatement that is;quantitatively immaterial may be qualitatively material. In regards to these;items, professional standards require the auditor to;24) When setting the level of materiality on a particular;engagement, the auditor must consider;25) The Committee of Sponsoring Organizations (COSO) report;identified five interrelated components of internal control. Since then, a sixth;category has been identified, which is;26) Which of the following is NOT one of the interrelated;components of internal controls identified by the COSO report?;27) Which of the following is NOT one of the fundamental concepts;in the COSO report?s definition of internal control?;28) Which of the following necessary controls would address a;potential misstatement arising from a voucher being paid twice?;29) The nature of tests of controls relates to the type of;evidence obtained. Which of the following is NOT an example of a type of;evidence relevant to tests of controls?;30) Which of the following is one of the four basic functions of;every transaction?;31) To emphasize the importance of integrity and ethical values;among all personnel or an organization, the chief executive officer and other;top managers should do all of the following EXCEPT;32) Which of the following is NOT one of the factors that make up;the control environment?;33) An effective accounting system should identify and record only;the valid transaction of the entity that occurred in the current period, which;relates to the;34) Who is responsible for establishing the process and controls;for preparing accounting estimates?;35) An inaccurate form of the audit risk model would show that;36) Revising the planned level of detection risk will be necessary;whenever;37) PPS sampling would most likely NOT be cost-effective in;38) Which of the following is NOT an advantage of PPS sampling?;39) PPS sampling should NOT be used when;40) Which of the following is NOT a hardware and systems software;control?;41) Which of the following is NOT recognized as a type of general;controls?;42) Which of the following management responsibilities is NOT;established under PCAOB standards?
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