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5.0
AUD CPA EXAM NOTES QUESTIONS
WITH DETAILED VERIFIED ANSWERS
(100% CORRECT ANSWERS)
/ALREADY GRADED A+
SU 1
✓ Ans: Engagement Responsibilities
Nature of an Attest Engagement
✓ Ans: Gives an assertion or opinion on the material of the responsible
party. They only apply to a CPA operating in public practice. Some
services require a CPA to disclaim assurance.
Attestation Standards
✓ Ans: General Standards (training, proficiency, knowledge). Should be
measurable. CPA must maintain independence.
✓ Field Work Standards (planning and supervision & sufficient appropriate
evidence)
✓ Reporting Standards (Character of Engagement, conclusion,
reservations, restrictions)
✓
✓ Acronym: TIPSC PE CCRR
Generally Accepted Auditing Standards and the International Auditing
Standards
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✓ Ans: The General Standards were codified between GAAS and the
AICPA's ASB. They basically converge with international standards but
still differ in some areas.
Who regulates issuers versus non-issuer audits?
✓ Ans: Issuers Audit = PCAOB, Non-issuer = ASB Standards
Who issues Government Audit Standards?
✓ Ans: The yellowbook is the government standards and is issued by the
Governmental Accountability Office. It is ASB unless modified. Federal
Awards may require a single audit which falls under the OMB Single
Audit Act.
Purpose of an Audit
✓ Ans: To provide financial statement users with an opinion on whether
the financial statements are presented fairly in accordance with the
applicable financial reporting framework and free from material
misstatement whether due to fraud or error.
Professional Skepticism
✓ Ans: Required by auditors when performing an audit.
Audit Risk
✓ Ans: The risk that an audit will not detect a material misstatement.
There will always be audit risk, but the goal is to get that risk as close to
zero as possible.
Managements Assertions
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✓ Ans: CAVE CROC
✓ Completeness
✓ Accuracy
✓ Valuation and Allocation
✓ Existence
✓ Cutoff
✓ Rights and Obligations
✓ Occurrence
✓ Classification and Understandability
Assertions about Transactions and Events (P&L and Cash Flows)
✓ Ans: Occurrence, Completeness, Accuracy, Cutoff, Classification
Assertions about Account Balances (B/S)
✓ Ans: Existence, Rights and Obligations, Completeness, Valuation and
Allocation
Assertions about Presentation and Disclosure (Mainly notes to financial
statements)
✓ Ans: Occurrence and Rights and Obligations, Completeness,
Classification and Understandability, Accuracy and Valuation
PCAOB Assertions
✓ Ans: Same as above but they do not explicitly address accuracy.
Professional Responsibilities of Auditors
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✓ Ans: Must comply with unconditional requirements (i.e.
independence).
Additional Professional Services
✓ Ans: Preparation (Non-attest), Compilation (Non-attest but must be
independent), Review (Limited assurance, performed by inquiry and
analytical procedure), agreed upon procedures (attest, must be
independent), Prospective Financial Statements, Examinations of
Internal Control over Financial Reporting
Assurance Services
✓ Ans: Assurance > Attest > Audit
✓ Does not include consulting services
✓ Designed to enhance decision making
Quality Control
✓ Ans: Starts with Tone of the Top, ethical requirements, and other
procedures.
✓ SOX requires a second auditor to sign off on audits. CEO and CFO must
sign off on financial statements.
SU 2
✓ Ans: Professional Responsibilities
Code of Professional Conduct - Principles
✓ Ans: Responsibilities, Protect public interest, act with integrity, be
objective and independent, act with due professional care, follow the
scope and nature of services
Examstudy - Stuvia US
In today's fast-paced educational landscape, students need reliable resources to excel in their studies.
5.0
AUD CPA EXAM NOTES QUESTIONS
WITH DETAILED VERIFIED ANSWERS
(100% CORRECT ANSWERS)
/ALREADY GRADED A+
SU 1
✓ Ans: Engagement Responsibilities
Nature of an Attest Engagement
✓ Ans: Gives an assertion or opinion on the material of the responsible
party. They only apply to a CPA operating in public practice. Some
services require a CPA to disclaim assurance.
Attestation Standards
✓ Ans: General Standards (training, proficiency, knowledge). Should be
measurable. CPA must maintain independence.
✓ Field Work Standards (planning and supervision & sufficient appropriate
evidence)
✓ Reporting Standards (Character of Engagement, conclusion,
reservations, restrictions)
✓
✓ Acronym: TIPSC PE CCRR
Generally Accepted Auditing Standards and the International Auditing
Standards
Examstudy - Stuvia US
,| OnlineExams | TestPrep | StudyResources | AcademicSuccess | ExamPreparation | QuizTime | LearningTools | Education | StudentSupport
In today's fast-paced educational landscape, students need reliable resources to excel in their studies.
5.0
✓ Ans: The General Standards were codified between GAAS and the
AICPA's ASB. They basically converge with international standards but
still differ in some areas.
Who regulates issuers versus non-issuer audits?
✓ Ans: Issuers Audit = PCAOB, Non-issuer = ASB Standards
Who issues Government Audit Standards?
✓ Ans: The yellowbook is the government standards and is issued by the
Governmental Accountability Office. It is ASB unless modified. Federal
Awards may require a single audit which falls under the OMB Single
Audit Act.
Purpose of an Audit
✓ Ans: To provide financial statement users with an opinion on whether
the financial statements are presented fairly in accordance with the
applicable financial reporting framework and free from material
misstatement whether due to fraud or error.
Professional Skepticism
✓ Ans: Required by auditors when performing an audit.
Audit Risk
✓ Ans: The risk that an audit will not detect a material misstatement.
There will always be audit risk, but the goal is to get that risk as close to
zero as possible.
Managements Assertions
Examstudy - Stuvia US
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5.0
✓ Ans: CAVE CROC
✓ Completeness
✓ Accuracy
✓ Valuation and Allocation
✓ Existence
✓ Cutoff
✓ Rights and Obligations
✓ Occurrence
✓ Classification and Understandability
Assertions about Transactions and Events (P&L and Cash Flows)
✓ Ans: Occurrence, Completeness, Accuracy, Cutoff, Classification
Assertions about Account Balances (B/S)
✓ Ans: Existence, Rights and Obligations, Completeness, Valuation and
Allocation
Assertions about Presentation and Disclosure (Mainly notes to financial
statements)
✓ Ans: Occurrence and Rights and Obligations, Completeness,
Classification and Understandability, Accuracy and Valuation
PCAOB Assertions
✓ Ans: Same as above but they do not explicitly address accuracy.
Professional Responsibilities of Auditors
Examstudy - Stuvia US
, | OnlineExams | TestPrep | StudyResources | AcademicSuccess | ExamPreparation | QuizTime | LearningTools | Education | StudentSupport
In today's fast-paced educational landscape, students need reliable resources to excel in their studies.
5.0
✓ Ans: Must comply with unconditional requirements (i.e.
independence).
Additional Professional Services
✓ Ans: Preparation (Non-attest), Compilation (Non-attest but must be
independent), Review (Limited assurance, performed by inquiry and
analytical procedure), agreed upon procedures (attest, must be
independent), Prospective Financial Statements, Examinations of
Internal Control over Financial Reporting
Assurance Services
✓ Ans: Assurance > Attest > Audit
✓ Does not include consulting services
✓ Designed to enhance decision making
Quality Control
✓ Ans: Starts with Tone of the Top, ethical requirements, and other
procedures.
✓ SOX requires a second auditor to sign off on audits. CEO and CFO must
sign off on financial statements.
SU 2
✓ Ans: Professional Responsibilities
Code of Professional Conduct - Principles
✓ Ans: Responsibilities, Protect public interest, act with integrity, be
objective and independent, act with due professional care, follow the
scope and nature of services
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