Question

7. An audit of historical financial statements most commonly includes the: a. balance sheet, the income statement, and the statement of cash flows. b. income statement, the statement of cash flows, and the statement of net working capital. c. statement of cash flows, the balance sheet, and the retained earnings statement. all of the above The generally accepted auditing standard that requires “Adequate technical training and proficiency” is normally interpreted as requiring the auditor to have: a. formal education in auditing and accounting. adequate practical experience for the work being performed. continuing professional education. all of the above. od Which of the following statements most accurately captures the intent of the performance standards (standards of field work)? They are primarily concerned with personal attributes necessary during the conduct of the audit. They provide extensive guidance regarding the conduct of an audit. The standards are primarily directed at the auditor's planning, understanding of internal control, and evidence accumulation. The standards are primarily concerned with the conduct of substantive testing as opposed to testing of internal controls. 10. An auditor need not abide by a particular auditing standard if the auditor believes that: the issue in question is immaterial in amount. more expertise is needed to fulfill the requirement. the requirement of the standard has not been addressed by the PCAOB. d. any of the above three are correct. Sod 11. The third “Responsibilities” standard states that due care is to be exercised in the performance of an audit. This standard is generally interpreted to require: a. objective review of the adequacy of the technical training of firm personnel. b. thorough review of the existing internal control structure. critical review of work done at every level of supervision. periodic review of a CPA firm's quality control procedures. ooo 12. déos The AICPA has authority to establish standards and rules in all but which of the following areas? Auditing standards applicable to financial statements of private companies. Compilation and review standards. Professional conduct. Auditing standards applicable to financial statements of private and public companies.

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Answer 1

Question 7 Option (A) is Correct An Audit of historical Financial Statements Most commonly includes: (i) Balance Sheet (ii) Income Statement (iii) Statement of Cash flows and Statement of Changes in Equity Question 8 Option (D) is correct The Generally Accepted auditing standards that requires "adequate technical training and proficiency" is normally interpreted as requiring the auditor to have : (i) Continuing professional education (ii) Formal education in auditing and accounting (iii) adequate practical experience for the work being performed Question 9 Option (C.) is Correct Performance standards are primarily directed at the auditors planning understanding of internal control and accumulation of evidence Question 10 Option (A) is Correct An Auditor need not abide by a particular auditing standard if the auditor believes that: (i) the issue in question is immaterial in amount (ii) the requirement of standard is impractial to perform or impossible to perform Question 11 Option (C.) is Correct The Third responsibilities standard states that due care is to be exercised in the performance of an audit, this standard is generally interpreted to require "Critical Review of work done at every level of Supervision" Question 12 Option (D) is Correct The AICPA has authority to establish standards and rules in "Auditing standards applicable to financial statements of private and public companies"