765ytrew
TEST BANK
Auditing: A Risk-Based Approach 12th Edition by Karla Johnstone-Zehms
FULL TEST BANK!!!
ytrew
, 765ytrew
Test Bank for Auditing: A Risk Based-Approach 12th Edition by Larry E. Rittenberg
Karla M. Zehms
Chapter 01
1. The need for independent assurance arises because the interests of the users of information may be different
from the interests of those responsible for providing information.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 4:48 AM
DATE MODIFIED: 5/26/2023 4:49 AM
2. A financial statement audit is a systematic process of objectively obtaining and evaluating evidence.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 4:59 AM
DATE MODIFIED: 5/26/2023 5:00 AM
3. A bank using Milton Company's financial statements to evaluate Milton’s loan application is an example of a
user’s need for unbiased reporting.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:01 AM
ytrew
, 765ytrew
DATE MODIFIED: 5/26/2023 5:02 AM
4. An integrated audit requires the auditor to assess the effectiveness of internal controls.
ytrew
,Chapter 01
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:02 AM
DATE MODIFIED: 5/26/2023 5:03 AM
5. Auditors obtain and evaluate evidence regarding assertions about economic actions and events to verify the
accuracy of those assertions.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:03 AM
DATE MODIFIED: 5/26/2023 5:04 AM
6. Auditing is the process of verifying and assuring the complete accuracy of the financial statements.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:04 AM
DATE MODIFIED: 5/26/2023 5:05 AM
7. Management may have incentives to present biased financial information, but the various users of the
statements are likely to have the same interest in the financial information.
a. True
Page 4
,Chapter 01
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:05 AM
DATE MODIFIED: 5/26/2023 5:06 AM
8. Auditing exists because users need unbiased information on which to assess management performance and
make economic decisions.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:06 AM
DATE MODIFIED: 5/26/2023 5:07 AM
9. Users rely on the auditors' independent assessment of financial statement presentation because few users
have direct knowledge of the company's operations.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:07 AM
DATE MODIFIED: 5/26/2023 5:08 AM
10. If the auditor has no reservations about management’s financial statements, then the auditor will issue a
qualified opinion.
a. True
Page 5
,Chapter 01
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:08 AM
DATE MODIFIED: 5/26/2023 5:09 AM
11. Independence is often referred to as the cornerstone of the auditing profession.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:09 AM
DATE MODIFIED: 5/26/2023 5:11 AM
12. Auditors generally need quantitative and mathematical skills more than they need communication and
leadership skills.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:11 AM
DATE MODIFIED: 5/26/2023 5:12 AM
13. The overall objective of an audit is to guarantee the financial statements are free of misstatement.
a. True
b. False
ANSWER: False
Page 6
,Chapter 01
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:13 AM
DATE MODIFIED: 5/26/2023 5:15 AM
14. The foundation for the audit opinion formulation process relies on obtaining evidence to support the
auditor’s opinion.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:15 AM
DATE MODIFIED: 5/26/2023 5:16 AM
15. Complex transactions, information, and processing systems provide an opportunity for management to
mislead users of financial statements.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:16 AM
DATE MODIFIED: 5/26/2023 5:17 AM
16. Users of audited financial statements include a company’s bondholders but not its stockholders, who are the
owners of the company.
a. True
b. False
ANSWER: False
Page 7
,Chapter 01
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:17 AM
DATE MODIFIED: 5/26/2023 5:18 AM
17. A key responsibility of the internal audit function is to provide assurance on the reliability of financial
information reported to external users of audited financial statements.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:18 AM
DATE MODIFIED: 5/26/2023 5:18 AM
18. The audit committee oversees both the internal and external auditors.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:19 AM
DATE MODIFIED: 5/26/2023 5:20 AM
19. A CPA is a certified public accountant who is licensed by a state board of accountancy.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
Page 8
,Chapter 01
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:20 AM
DATE MODIFIED: 5/26/2023 5:20 AM
20. Internal controls are the responsibility of management.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:21 AM
DATE MODIFIED: 5/26/2023 5:21 AM
21. Audit staff performing audit work must be appropriately supervised by partners and managers.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:22 AM
DATE MODIFIED: 5/26/2023 5:22 AM
22. An auditor who has reservations about the effectiveness of a client company’s internal controls would issue
an adverse opinion on internal controls.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
Page 9
, Chapter 01
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:22 AM
DATE MODIFIED: 5/26/2023 5:23 AM
23. Audit firm culture is one of the primary drivers of audit quality.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.02 - Explain audit quality and its elements in relation to the Financial
Reporting Council’s Audit Quality Framework
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:23 AM
DATE MODIFIED: 5/26/2023 5:25 AM
24. Effective audit processes, by themselves, are sufficient to achieve audit quality.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.02 - Explain audit quality and its elements in relation to the Financial
Reporting Council’s Audit Quality Framework
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:25 AM
DATE MODIFIED: 5/26/2023 5:25 AM
25. A quality audit is one performed “in accordance with generally accepted auditing standards (GAAS) to
provide reasonable assurance that the audited financial statements and related disclosures are presented in
accordance with generally accepted accounting principles (GAAP) and are not materially misstated whether due
to errors or fraud.”
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.02 - Explain audit quality and its elements in relation to the Financial
Page 10
TEST BANK
Auditing: A Risk-Based Approach 12th Edition by Karla Johnstone-Zehms
FULL TEST BANK!!!
ytrew
, 765ytrew
Test Bank for Auditing: A Risk Based-Approach 12th Edition by Larry E. Rittenberg
Karla M. Zehms
Chapter 01
1. The need for independent assurance arises because the interests of the users of information may be different
from the interests of those responsible for providing information.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 4:48 AM
DATE MODIFIED: 5/26/2023 4:49 AM
2. A financial statement audit is a systematic process of objectively obtaining and evaluating evidence.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 4:59 AM
DATE MODIFIED: 5/26/2023 5:00 AM
3. A bank using Milton Company's financial statements to evaluate Milton’s loan application is an example of a
user’s need for unbiased reporting.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:01 AM
ytrew
, 765ytrew
DATE MODIFIED: 5/26/2023 5:02 AM
4. An integrated audit requires the auditor to assess the effectiveness of internal controls.
ytrew
,Chapter 01
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:02 AM
DATE MODIFIED: 5/26/2023 5:03 AM
5. Auditors obtain and evaluate evidence regarding assertions about economic actions and events to verify the
accuracy of those assertions.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:03 AM
DATE MODIFIED: 5/26/2023 5:04 AM
6. Auditing is the process of verifying and assuring the complete accuracy of the financial statements.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:04 AM
DATE MODIFIED: 5/26/2023 5:05 AM
7. Management may have incentives to present biased financial information, but the various users of the
statements are likely to have the same interest in the financial information.
a. True
Page 4
,Chapter 01
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:05 AM
DATE MODIFIED: 5/26/2023 5:06 AM
8. Auditing exists because users need unbiased information on which to assess management performance and
make economic decisions.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:06 AM
DATE MODIFIED: 5/26/2023 5:07 AM
9. Users rely on the auditors' independent assessment of financial statement presentation because few users
have direct knowledge of the company's operations.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:07 AM
DATE MODIFIED: 5/26/2023 5:08 AM
10. If the auditor has no reservations about management’s financial statements, then the auditor will issue a
qualified opinion.
a. True
Page 5
,Chapter 01
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:08 AM
DATE MODIFIED: 5/26/2023 5:09 AM
11. Independence is often referred to as the cornerstone of the auditing profession.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:09 AM
DATE MODIFIED: 5/26/2023 5:11 AM
12. Auditors generally need quantitative and mathematical skills more than they need communication and
leadership skills.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:11 AM
DATE MODIFIED: 5/26/2023 5:12 AM
13. The overall objective of an audit is to guarantee the financial statements are free of misstatement.
a. True
b. False
ANSWER: False
Page 6
,Chapter 01
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:13 AM
DATE MODIFIED: 5/26/2023 5:15 AM
14. The foundation for the audit opinion formulation process relies on obtaining evidence to support the
auditor’s opinion.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:15 AM
DATE MODIFIED: 5/26/2023 5:16 AM
15. Complex transactions, information, and processing systems provide an opportunity for management to
mislead users of financial statements.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:16 AM
DATE MODIFIED: 5/26/2023 5:17 AM
16. Users of audited financial statements include a company’s bondholders but not its stockholders, who are the
owners of the company.
a. True
b. False
ANSWER: False
Page 7
,Chapter 01
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:17 AM
DATE MODIFIED: 5/26/2023 5:18 AM
17. A key responsibility of the internal audit function is to provide assurance on the reliability of financial
information reported to external users of audited financial statements.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:18 AM
DATE MODIFIED: 5/26/2023 5:18 AM
18. The audit committee oversees both the internal and external auditors.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:19 AM
DATE MODIFIED: 5/26/2023 5:20 AM
19. A CPA is a certified public accountant who is licensed by a state board of accountancy.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
Page 8
,Chapter 01
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:20 AM
DATE MODIFIED: 5/26/2023 5:20 AM
20. Internal controls are the responsibility of management.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:21 AM
DATE MODIFIED: 5/26/2023 5:21 AM
21. Audit staff performing audit work must be appropriately supervised by partners and managers.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:22 AM
DATE MODIFIED: 5/26/2023 5:22 AM
22. An auditor who has reservations about the effectiveness of a client company’s internal controls would issue
an adverse opinion on internal controls.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.01 - Define financial statement auditing in relation to decision makers’
Page 9
, Chapter 01
demands for reliable financial and internal control information
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:22 AM
DATE MODIFIED: 5/26/2023 5:23 AM
23. Audit firm culture is one of the primary drivers of audit quality.
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.02 - Explain audit quality and its elements in relation to the Financial
Reporting Council’s Audit Quality Framework
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:23 AM
DATE MODIFIED: 5/26/2023 5:25 AM
24. Effective audit processes, by themselves, are sufficient to achieve audit quality.
a. True
b. False
ANSWER: False
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.02 - Explain audit quality and its elements in relation to the Financial
Reporting Council’s Audit Quality Framework
NATIONAL STANDARDS: United States - BUSPROG: Comprehension
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
DATE CREATED: 5/26/2023 5:25 AM
DATE MODIFIED: 5/26/2023 5:25 AM
25. A quality audit is one performed “in accordance with generally accepted auditing standards (GAAS) to
provide reasonable assurance that the audited financial statements and related disclosures are presented in
accordance with generally accepted accounting principles (GAAP) and are not materially misstated whether due
to errors or fraud.”
a. True
b. False
ANSWER: True
POINTS: 1
QUESTION TYPE: True / False
HAS VARIABLES: False
LEARNING OBJECTIVES: AUD.ZEHMS.24.01.02 - Explain audit quality and its elements in relation to the Financial
Page 10
