TEST BANK FOR AUDITING AND ASSURANCE SERVICES, 18TH EDITION BY ALVIN A. ARENS, RANDAL J. ELDER, MARK S. BEASLEY, CHRIS E. HOGAN LATEST 2026

TEST BANK
FOR AUDITING AND ASSURANCE SERVICES, 18TH
EDITION BY ALVIN A. ARENS, RANDAL J. ELDER,
MARK S. BEASLEY, CHRIS E. HOGAN LATEST 2026
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uditing and
assurance services, 16th edition by arens, elder, beasley, hogan

, auditing and assurance services, (arens)
chapter 1 the demand for audit and other assurance services

learning objective 1-1

1) the sarbanes-oxley act applies to which of the following companies?
A) all companies
B) privately held companies
C) public companies
all public companies and privately held companies with assets greater than $500 million Ans:
c
terms: sarbanes-oxley act
diff: easy
objective: lo 1-1
aacsb: reflective thinking skills
topic: sox

2) which of the following is considered audit
evidence? a)
oral statements written auditor
made by communications observation
management
y n n

b)
oral statements written auditor
made by communications observation
management
n y y

c)
oral statements written auditor
made by communications observation
management
y y y

d)
oral statements written auditor
made by communications observation
management
n n y
Ans: c
terms: audit evidence
diff: moderate
objective: lo 1-1
aacsb: reflective thinking skills
3) evidence is paramount to audit and attestation engagements. list the four basic types
2

, of audit evidence.
Ans: the four types of audit and attestation evidence include:
1. electronic and documentary data about transactions
2. written and electronic communications with outsiders
3. observations by the auditor
4. oral testimony of the auditee
(client) terms: basic types of
audit evidence diff: easy
objective: lo 1-1
aacsb: reflective thinking skills

4) the criteria by which an auditor evaluates the information under audit may vary
with the information being audited.
A) true
false Ans:
a
terms: criteria which an auditor evaluates
information diff: easy
objective: lo 1-1
aacsb: reflective thinking skills

5) the criteria used by an external auditor to evaluate published financial statements are
known as generally accepted auditing standards.
A) true
false Ans:
b
terms: criteria used by external auditor to evaluate published financial
statements diff: easy
objective: lo 1-1
aacsb: reflective thinking skills

6) the sarbanes-oxley act establishes standards related to the audits of privately
held companies.
A) true
false Ans:
b
terms: sarbanes-oxley act
diff: easy
objective: lo 1-1
aacsb: reflective thinking skills
topic: sox




2

, 7) the sarbanes-oxley act is widely viewed as having ushered in sweeping changes to
auditing and financial reporting.
A) true
false Ans:
a
terms: sarbanes-oxley act
diff: easy
objective: lo 1-1
aacsb: reflective thinking skills
topic: sox

8) an auditor must be competent and have an independent mental attitude.
A) true
false Ans:
a
terms: competence and independent mental attitude
diff: easy
objective: lo 1-1
aacsb: reflective thinking skills

learning objective 1-2

1) recording, classifying, and summarizing economic events in a logical manner for the
purpose of providing financial information for decision making is commonly called:
A) finance.
B) auditing.
C) accounting.
economics. Ans: c
terms: recording, classifying, and summarizing economic
events diff: easy
objective: lo 1-2
aacsb: reflective thinking skills

2) an accountant:
A) must possess expertise in the accumulation of audit evidence.
B) must decide the number and types of items to test.
C) must have an understanding of the principles and rules that provide the basis for
preparing the accounting information.
must be a cpa. Ans:
c
terms: distinguishes auditors from
accountants diff: moderate
objective: lo 1-2
aacsb: reflective thinking skills




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