Principles of Auditing and Other Assurance
Services 2026 Complete Test Bank
Questions & Correct Answers | A+
Guaranteed
‣ An "eyes-open" approach of looking for anything unusual that can
raise questions related to evidence that needs to be obtained is called
____________. Answer: scanning
‣ Inquiry:
a. generally involves the collection of verbal evidence
b. relates to evidence from independent parties only
c. procedures are generally used in to final stages of the audit
d. is never enough on its own to reach an audit conclusion . Answer: a.
generally involves the collection of verbal evidence
d. is never enough on its own to reach an audit conclusion
‣ Confirmation can provide evidence regarding:
a. valuation
b. cutoff
c. rights and obligations
d. completeness
e. existence . Answer: a. valuation
,b. cutoff
c. rights and obligations
e. existence
‣ When an auditor compares his or her expectation to a recorded
balance, __________________ __________________ are being
performed. . Answer: analytical procedures
‣ The collection of verbal evidence from independent parties and
management is the audit procedure known as _______________. .
Answer: inquiry
‣ True or false: One objective of a financial statement audit is to
determine if, in all material respects, the entity being audited is reporting
the one true net income. . Answer: False: a range of potential net income
figures is allowable under both GAAP and IFRS.
‣ Engagement letters:
a. are only required for new clients
b. set forth audit objectives
c. define management and auditor responsibilities
d. should not mention fees
e. reduce the risk of misunderstandings . Answer: b. set forth audit
objectives
c. define management and auditor responsibilities
, e. reduce the risk of misunderstandings
‣ Confirmation is a representative audit procedure used to test the
PCAOB and ASB assertion of:
a. existence or occurrence
b. presentation and disclosure
c. valuation and allocation
d. rights and obligations . Answer: d. rights and obligations
‣ The substantive audit plan depends almost exclusively upon the:
a. size of the client
b. risk assessment of the client
c. industry the client is in
d. size of the audit team . Answer: b. risk assessment of the client
‣ Selecting an item in the financial records and following the path back
to the source document is referred to as _______________. . Answer:
vouching
‣ The auditor selects a basic source document and follows the processing
path forward to its final recording and to the financial statements when
engaged in:
a. confirmation
b. tracing
c. vouching
Services 2026 Complete Test Bank
Questions & Correct Answers | A+
Guaranteed
‣ An "eyes-open" approach of looking for anything unusual that can
raise questions related to evidence that needs to be obtained is called
____________. Answer: scanning
‣ Inquiry:
a. generally involves the collection of verbal evidence
b. relates to evidence from independent parties only
c. procedures are generally used in to final stages of the audit
d. is never enough on its own to reach an audit conclusion . Answer: a.
generally involves the collection of verbal evidence
d. is never enough on its own to reach an audit conclusion
‣ Confirmation can provide evidence regarding:
a. valuation
b. cutoff
c. rights and obligations
d. completeness
e. existence . Answer: a. valuation
,b. cutoff
c. rights and obligations
e. existence
‣ When an auditor compares his or her expectation to a recorded
balance, __________________ __________________ are being
performed. . Answer: analytical procedures
‣ The collection of verbal evidence from independent parties and
management is the audit procedure known as _______________. .
Answer: inquiry
‣ True or false: One objective of a financial statement audit is to
determine if, in all material respects, the entity being audited is reporting
the one true net income. . Answer: False: a range of potential net income
figures is allowable under both GAAP and IFRS.
‣ Engagement letters:
a. are only required for new clients
b. set forth audit objectives
c. define management and auditor responsibilities
d. should not mention fees
e. reduce the risk of misunderstandings . Answer: b. set forth audit
objectives
c. define management and auditor responsibilities
, e. reduce the risk of misunderstandings
‣ Confirmation is a representative audit procedure used to test the
PCAOB and ASB assertion of:
a. existence or occurrence
b. presentation and disclosure
c. valuation and allocation
d. rights and obligations . Answer: d. rights and obligations
‣ The substantive audit plan depends almost exclusively upon the:
a. size of the client
b. risk assessment of the client
c. industry the client is in
d. size of the audit team . Answer: b. risk assessment of the client
‣ Selecting an item in the financial records and following the path back
to the source document is referred to as _______________. . Answer:
vouching
‣ The auditor selects a basic source document and follows the processing
path forward to its final recording and to the financial statements when
engaged in:
a. confirmation
b. tracing
c. vouching
