Exam 1 CPA Exam with 100% correct answers

The Sarbanes-Oxley Act of 2002 imposes a mandatory rotation applicable to both the audit engagement partner and the quality control (also called review) partner. How long in total is the partner allowed to serve as the engagement partner or review partner before someone else must serve in that capacity? 5 years. An entity engaged a CPA to determine whether the client's web sites meet defined criteria for standard business practices and controls over transaction integrity and information protection. In performing this engagement, the CPA should comply with the provisions of Statements on Standards for Attestation Engagements. At least how often should the PCAOB inspect a registered public accounting firm that regularly issues audit reports to 50 issuers? Every three years. An attestation engagement is one in which a CPA is engaged to Issue a written communication expressing a conclusion about the reliability of a written assertion that is the responsibility of another party. The Public Company Accounting Oversight Board (PCAOB) is charged with all of the following responsibilities except: Establishing accounting standards for public companies. Under the Sarbanes-Oxley Act of 2002, which of the following is not a stated responsibility of the Public Company Accounting Oversight Board? Issuing accounting standards that must be followed by issuers in financial reporting. Which of the following events most likely indicates the existence of related parties? Selling real estate at a price that differs significantly from its market value. When auditing related party transactions, an auditor places primary emphasis on Evaluating the disclosure of the related party transactions. Which of the following activities is an analytical procedure an auditor would perform in the final overall review stage of an audit to ensure that the financial statements are free from material misstatement? Comparing the current year's financial statements with those of the prior year A primary objective of analytical procedures used in the final review stage of an audit is to Assist the auditor in evaluating the overall financial statement presentation. Which of the following statements is correct concerning analytical procedures used in planning an audit engagement? They usually use financial and nonfinancial data aggregated at a high level.