TEST BANK For Auditing & Assurance Services: A Syst
S! S! S! S! S! S! S! S!S!
ematic Approach, 12th Edition by Messier
S! S! S! S! S! S !
Chapters 1 - 21 Complete
S! S! S! S!
,Chapter 1: An Introductionto Assuranceand Financial Statement Auditing
S! S! S! S! S! S! S! S!
Chapter 2: The Financial Statement Auditing Environment
S! S! S! S! S! S! S ! Ch
apter 3: Audit Planning,lTypesofAudit Tests,land Materiality Chapter
S! S! S! S! S! S ! S!
4: Risk Assessment
S! S!
Chapter S ! S ! S ! S ! S ! S ! 5: S ! S ! S ! S ! S ! S ! Evidenceand S ! S ! S ! S ! S ! S ! Docume
ntation S ! Chapter S ! S ! 6: S ! S ! Internal S ! S ! Controlina S ! S ! Financial S ! S ! State
mentlAudit S ! Chapter S! S! 7: S ! S ! Auditing S ! S ! Internal S! S! Controlover S! S! Financial S !
S ! Reporting S ! Chapter 8: AuditlSampling: An Overviewand Applicationto Testso
S! S! S! S! S! S!
fControls Chapter 9: AuditlSampling: An ApplicationtolSubstantive TestsloflAccount
S! S! S! S! S! S! S!
Balances Chapter S! S ! S ! S ! S ! 10: S ! S ! S ! S ! S ! Auditingthe S ! S ! S ! S ! Revenue S !
S ! S ! S ! Process S ! Chapter S ! S ! S ! S ! 11: S ! S ! S ! S ! Auditingthe S ! S ! S ! S ! Purc
hasing S ! S ! S ! S ! Process S ! Chapter S ! 12: S! S! Auditingthe S ! Human S ! Resource S
!S! Management S!S! Process S ! Chapter 13: Auditingthe Inventory Management Pr
S! S! S! S! S!
ocess
Chapter 14: Auditingthe Financing/Investing Process:lPrepaid Expenses, IntangiblelAssets, and Property,
S! S! S! S! S! S! S! S! S!
Plant,landEquipment S
!
Chapter 15: Auditingthe Financing/Investing Process:lLong-
S! S! S! S!
S Term Liabilities, Stockholders’ Equity, and Income Statement Accoun
! S! S! S! S! S! S! S!
ts
Chapter 16: Auditingthe Financing/Investing Process:lCashand Investments
S! S! S! S! S! S!
Chapter S ! S ! S ! 17: S ! S ! S ! Completingthe S ! S ! S ! Audit S ! S ! S ! Engagemen
t S ! Chapter S ! S ! 18: S ! S ! Reportson S ! S ! Audited S ! S ! Financial S ! S ! Statem
ents S ! Chapter 19: Professional Conduct, Independence, and Quality Manag
S! S! S! S! S! S! S!
ement Chapter 20: Legal Liability
S! S
! S
! S
!
,Chapter 21: Assurance, Attestation, and Internal Auditing Services
S! S! S! S! S! S! S!
Auditing& Assurance Services: ASystematic Approach,l12e(Messier) Chapter 1 An Intr
S! S! S! S! S! S! S ! S! S!
oductionto Assuranceand Financial Statement Auditing
S! S! S! S!
1) Auditingfocusesonrules,ltechniques,andcomputationslrequiredtoprepareandanalyzefinan S ! S !
S cialinformation.
!
ANSWER:l FALSElDifficulty: S!
1Easy
Topic: TheImportanceforStudying Auditing Le
S! S! S!
arningObjective: 01- S
! S!
01Understandwhystudyingauditingcanbevaluabletoyouwhetherornotlyouplantolbecomeanaudit S
! or, andwhyitlisdifferentfromstudyingaccounting.
S ! S!
Bloom's: Remember AACSB S ! S!
: Communication
S!
AICPA: BBLegal;FNDecisionMaking
S!
2) Decisionmakersdemandreliableinformationthatislprovidedbyaccountants.
ANSWER:l TRUEDifficulty: S!
1Easy
Topic: The DemandforAuditingand Assurance
S! S! S! S!
LearningObjective: 01- S
! S!
02Understandtheldemandforauditingandbeabletolexplainthedesiredcharacteristicsofauditorsa S ! S !
S ndauditserviceslthroughananalogytoahouseinspectorandahouseinspectionservice.
!
Bloom's: Understand AACS S! S! S!
B:l CommunicationS!
AICPA: FNDecision Making;BBIndustry
S ! S!
3) Informationasymmetryseldomoccurs.
ANSWER:l FALSElDifficulty: S!
2Medium
Topic: The DemandforAuditingand Assurance
S! S! S! S!
LearningObjective: 01- S
! S!
02Understandtheldemandforauditingandbeabletolexplainthedesiredcharacteristicsofauditorsa S ! S !
S ndauditserviceslthroughananalogytoahouselinspectorandahouseinspectionservice.
!
Bloom's: Apply S!
AACSB: Communication S!
AICPA: BBIndustry; FNReporting
S ! S!
, 4) Conflictslofinterestoftenoccurbetweenlabsenteeownerslandmanagers.
ANSWER:l TRUEDifficulty: S!
2Medium
Topic: The DemandforAuditingand Assurance
S! S! S! S!
LearningObjective: 01- S
! S!
02Understandtheldemandforauditingandbeabletolexplainthedesiredcharacteristicsofauditorsa S ! S !
S ndauditserviceslthroughananalogytoahouselinspectorandahouseinspectionservice.
!
Bloom's: Apply S!
AACSB: Communication S!
AICPA: BBIndustry; FNReportingS ! S!
5) Auditingserviceslandattestationserviceslarethelsame.
ANSWER:l FALSElDifficulty: S!
1Easy
Topic: Auditing, Attest,andAssurance ServicesDefined LearningO
S! S! S! S!
bjective: 01- S!
03Understandtherelationshipsamongauditing,lattestation,andassuranceservices. S ! S ! S !
Bloom's: Understand AACS S! S!
B: Communication
S!
AICPA: BBIndustry; FNReportingS ! S!
6) Auditingisatypeofattestservice. S!
ANSWER:l TRUEDifficulty: S!
1Easy
Topic: Auditing, Attest,landAssurance ServicesDefined LearningO
S! S! S! S!
bjective: 01- S!
03Understandtherelationshipsamongauditing,lattestation,landassuranceservices.;l01-
S ! 04Knowthebasicdefinitionofafinancialstatementaudit.
S ! S !
Bloom's: Understand AACS S! S! S!
B:l Communication
S!
AICPA: BBIndustry; FNReportingS ! S!
7) Testingalltransactionsthatloccurredduringtheperiodislcostlprohibitive.
ANSWER:l TRUEDifficulty: S!
2 Medium Topic: TheAuditP
S! S! S! S!
rocess
LearningObjective: 01- S
! S!
06Beableltoexplainwhyonmostauditengagementsanauditortestslonlyasampleoftransactionsthat
S! S ! S ! S !
S occurred.
! S !
Bloom's: Apply S!
AACSB: Communication S!
AICPA: FNDecisionMaking;BBCritical Thinking
S ! S!
S! S! S! S! S! S! S! S!S!
ematic Approach, 12th Edition by Messier
S! S! S! S! S! S !
Chapters 1 - 21 Complete
S! S! S! S!
,Chapter 1: An Introductionto Assuranceand Financial Statement Auditing
S! S! S! S! S! S! S! S!
Chapter 2: The Financial Statement Auditing Environment
S! S! S! S! S! S! S ! Ch
apter 3: Audit Planning,lTypesofAudit Tests,land Materiality Chapter
S! S! S! S! S! S ! S!
4: Risk Assessment
S! S!
Chapter S ! S ! S ! S ! S ! S ! 5: S ! S ! S ! S ! S ! S ! Evidenceand S ! S ! S ! S ! S ! S ! Docume
ntation S ! Chapter S ! S ! 6: S ! S ! Internal S ! S ! Controlina S ! S ! Financial S ! S ! State
mentlAudit S ! Chapter S! S! 7: S ! S ! Auditing S ! S ! Internal S! S! Controlover S! S! Financial S !
S ! Reporting S ! Chapter 8: AuditlSampling: An Overviewand Applicationto Testso
S! S! S! S! S! S!
fControls Chapter 9: AuditlSampling: An ApplicationtolSubstantive TestsloflAccount
S! S! S! S! S! S! S!
Balances Chapter S! S ! S ! S ! S ! 10: S ! S ! S ! S ! S ! Auditingthe S ! S ! S ! S ! Revenue S !
S ! S ! S ! Process S ! Chapter S ! S ! S ! S ! 11: S ! S ! S ! S ! Auditingthe S ! S ! S ! S ! Purc
hasing S ! S ! S ! S ! Process S ! Chapter S ! 12: S! S! Auditingthe S ! Human S ! Resource S
!S! Management S!S! Process S ! Chapter 13: Auditingthe Inventory Management Pr
S! S! S! S! S!
ocess
Chapter 14: Auditingthe Financing/Investing Process:lPrepaid Expenses, IntangiblelAssets, and Property,
S! S! S! S! S! S! S! S! S!
Plant,landEquipment S
!
Chapter 15: Auditingthe Financing/Investing Process:lLong-
S! S! S! S!
S Term Liabilities, Stockholders’ Equity, and Income Statement Accoun
! S! S! S! S! S! S! S!
ts
Chapter 16: Auditingthe Financing/Investing Process:lCashand Investments
S! S! S! S! S! S!
Chapter S ! S ! S ! 17: S ! S ! S ! Completingthe S ! S ! S ! Audit S ! S ! S ! Engagemen
t S ! Chapter S ! S ! 18: S ! S ! Reportson S ! S ! Audited S ! S ! Financial S ! S ! Statem
ents S ! Chapter 19: Professional Conduct, Independence, and Quality Manag
S! S! S! S! S! S! S!
ement Chapter 20: Legal Liability
S! S
! S
! S
!
,Chapter 21: Assurance, Attestation, and Internal Auditing Services
S! S! S! S! S! S! S!
Auditing& Assurance Services: ASystematic Approach,l12e(Messier) Chapter 1 An Intr
S! S! S! S! S! S! S ! S! S!
oductionto Assuranceand Financial Statement Auditing
S! S! S! S!
1) Auditingfocusesonrules,ltechniques,andcomputationslrequiredtoprepareandanalyzefinan S ! S !
S cialinformation.
!
ANSWER:l FALSElDifficulty: S!
1Easy
Topic: TheImportanceforStudying Auditing Le
S! S! S!
arningObjective: 01- S
! S!
01Understandwhystudyingauditingcanbevaluabletoyouwhetherornotlyouplantolbecomeanaudit S
! or, andwhyitlisdifferentfromstudyingaccounting.
S ! S!
Bloom's: Remember AACSB S ! S!
: Communication
S!
AICPA: BBLegal;FNDecisionMaking
S!
2) Decisionmakersdemandreliableinformationthatislprovidedbyaccountants.
ANSWER:l TRUEDifficulty: S!
1Easy
Topic: The DemandforAuditingand Assurance
S! S! S! S!
LearningObjective: 01- S
! S!
02Understandtheldemandforauditingandbeabletolexplainthedesiredcharacteristicsofauditorsa S ! S !
S ndauditserviceslthroughananalogytoahouseinspectorandahouseinspectionservice.
!
Bloom's: Understand AACS S! S! S!
B:l CommunicationS!
AICPA: FNDecision Making;BBIndustry
S ! S!
3) Informationasymmetryseldomoccurs.
ANSWER:l FALSElDifficulty: S!
2Medium
Topic: The DemandforAuditingand Assurance
S! S! S! S!
LearningObjective: 01- S
! S!
02Understandtheldemandforauditingandbeabletolexplainthedesiredcharacteristicsofauditorsa S ! S !
S ndauditserviceslthroughananalogytoahouselinspectorandahouseinspectionservice.
!
Bloom's: Apply S!
AACSB: Communication S!
AICPA: BBIndustry; FNReporting
S ! S!
, 4) Conflictslofinterestoftenoccurbetweenlabsenteeownerslandmanagers.
ANSWER:l TRUEDifficulty: S!
2Medium
Topic: The DemandforAuditingand Assurance
S! S! S! S!
LearningObjective: 01- S
! S!
02Understandtheldemandforauditingandbeabletolexplainthedesiredcharacteristicsofauditorsa S ! S !
S ndauditserviceslthroughananalogytoahouselinspectorandahouseinspectionservice.
!
Bloom's: Apply S!
AACSB: Communication S!
AICPA: BBIndustry; FNReportingS ! S!
5) Auditingserviceslandattestationserviceslarethelsame.
ANSWER:l FALSElDifficulty: S!
1Easy
Topic: Auditing, Attest,andAssurance ServicesDefined LearningO
S! S! S! S!
bjective: 01- S!
03Understandtherelationshipsamongauditing,lattestation,andassuranceservices. S ! S ! S !
Bloom's: Understand AACS S! S!
B: Communication
S!
AICPA: BBIndustry; FNReportingS ! S!
6) Auditingisatypeofattestservice. S!
ANSWER:l TRUEDifficulty: S!
1Easy
Topic: Auditing, Attest,landAssurance ServicesDefined LearningO
S! S! S! S!
bjective: 01- S!
03Understandtherelationshipsamongauditing,lattestation,landassuranceservices.;l01-
S ! 04Knowthebasicdefinitionofafinancialstatementaudit.
S ! S !
Bloom's: Understand AACS S! S! S!
B:l Communication
S!
AICPA: BBIndustry; FNReportingS ! S!
7) Testingalltransactionsthatloccurredduringtheperiodislcostlprohibitive.
ANSWER:l TRUEDifficulty: S!
2 Medium Topic: TheAuditP
S! S! S! S!
rocess
LearningObjective: 01- S
! S!
06Beableltoexplainwhyonmostauditengagementsanauditortestslonlyasampleoftransactionsthat
S! S ! S ! S !
S occurred.
! S !
Bloom's: Apply S!
AACSB: Communication S!
AICPA: FNDecisionMaking;BBCritical Thinking
S ! S!
