AUDIT FINAL PAPER QUESTIONS AND
SOLUTIONS 2026 EXAM STUDY GUIDE 100%
CORRECT
⫸ The auditor's report on internal control quality can express which
of the following opinions regarding the quality of internal control?
Qualified or Adverse only
Unqualified, Qualified, or Adverse
Unqualified or Adverse only
Unqualified or Qualified only. Answer: Unqualified or Adverse only
⫸ The standards of independence, proficiency and training, and due
professional care are included in the:
General standards
Standards of independence
Standards of reporting
Standards of fieldwork. Answer: General standards
⫸ Which of the following is NOT a type of audit documentation that
auditors should include in their files?
The audit program
,The engagement letter
Copies of the client's financial statements
Each of the above is a type of audit documentation that the auditor
should include in the file. Answer: Each of the above is a type of audit
documentation that the auditor should include in the file
⫸ If the auditor fails to obtain a management representation letter,
she can still issue an unqualified audit opinion without modifications
if she obtains adequate evidence through other sources.
T/F. Answer: False
⫸ Audit partners in the U.S. can serve a particular "Public Company"
client for no more than _____ years consecutively.
3 years
5 years
7 years
There is no limit on the length of time an audit partner can
consecutively serve an audit client as long as she is independent from
the client.. Answer: 5 Years
⫸ Sampling risk exists when the auditor doesn't follow proscribed
sampling procedures.
T/F. Answer: False
, ⫸ An audit partner of ACE Auditors who practices in the Salt Lake
City, Utah office of the firm performs the audit of TCE Co. Partner B
practices in the Boise, Idaho office of the firm. She is not in an
oversight role in the firm, but provides around 5-7 hours of tax-related
services per year to TCE Co. Is Partner B considered a 'Covered
Member' under AICPA rules?
Yes, partner B is considered a covered member
There is not enough information to answer this question
No, partner B is not considered a covered member. Answer: No,
partner B is not considered a covered member
⫸ The Auditing Standards (AS's) are issued by which standard setter?
Auditing Standards Board
IAASB
SEC
PCAOB. Answer: PCAOB
⫸ Audits of financial statements provide absolute assurance that the
financial statements are free of material misstatements.
True/False. Answer: False
⫸ The Securities Exchange Act of 1934 requires that the AICPA set
rigorous auditing standards.
True/False. Answer: False
SOLUTIONS 2026 EXAM STUDY GUIDE 100%
CORRECT
⫸ The auditor's report on internal control quality can express which
of the following opinions regarding the quality of internal control?
Qualified or Adverse only
Unqualified, Qualified, or Adverse
Unqualified or Adverse only
Unqualified or Qualified only. Answer: Unqualified or Adverse only
⫸ The standards of independence, proficiency and training, and due
professional care are included in the:
General standards
Standards of independence
Standards of reporting
Standards of fieldwork. Answer: General standards
⫸ Which of the following is NOT a type of audit documentation that
auditors should include in their files?
The audit program
,The engagement letter
Copies of the client's financial statements
Each of the above is a type of audit documentation that the auditor
should include in the file. Answer: Each of the above is a type of audit
documentation that the auditor should include in the file
⫸ If the auditor fails to obtain a management representation letter,
she can still issue an unqualified audit opinion without modifications
if she obtains adequate evidence through other sources.
T/F. Answer: False
⫸ Audit partners in the U.S. can serve a particular "Public Company"
client for no more than _____ years consecutively.
3 years
5 years
7 years
There is no limit on the length of time an audit partner can
consecutively serve an audit client as long as she is independent from
the client.. Answer: 5 Years
⫸ Sampling risk exists when the auditor doesn't follow proscribed
sampling procedures.
T/F. Answer: False
, ⫸ An audit partner of ACE Auditors who practices in the Salt Lake
City, Utah office of the firm performs the audit of TCE Co. Partner B
practices in the Boise, Idaho office of the firm. She is not in an
oversight role in the firm, but provides around 5-7 hours of tax-related
services per year to TCE Co. Is Partner B considered a 'Covered
Member' under AICPA rules?
Yes, partner B is considered a covered member
There is not enough information to answer this question
No, partner B is not considered a covered member. Answer: No,
partner B is not considered a covered member
⫸ The Auditing Standards (AS's) are issued by which standard setter?
Auditing Standards Board
IAASB
SEC
PCAOB. Answer: PCAOB
⫸ Audits of financial statements provide absolute assurance that the
financial statements are free of material misstatements.
True/False. Answer: False
⫸ The Securities Exchange Act of 1934 requires that the AICPA set
rigorous auditing standards.
True/False. Answer: False
