TEST BANK COMPLETE_ AUDITING & ASSURANCE SERVICES: A SYSTEMATIC APPROACH 12TH EDITION, (2022) BY WILLIAM MESSIER JR, STEVEN GLOVER AND DOUGLAS PRAWITT ALL CHAPTERS 1-21| LATEST VERSION WITH VERIFIED ANSWERS| RATED A+

TEST BANK COMPLETE_
AUDITING & ASSURANCE SERVICES: A SYSTEMATIC APPROACH 12TH EDITION,
(2022)
BY WILLIAM MESSIER JR, STEVEN GLOVER AND DOUGLAS PRAWITT

ALL CHAPTERS 1-21| LATEST VERSION WITH VERIFIED ANSWERS| RATED A+

,PART 1: INTRODUCTION TO ASSURANCE AND FINANCIAL STATEMENT AUDITING ________________ 3
CHAPTER 1: AN INTRODUCTION TO ASSURANCE AND FINANCIAL STATEMENT AUDITING _________________ 3
CHAPTER 2: THE FINANCIAL STATEMENT AUDITING ENVIRONMENT _________________________________ 49
PART 2: AUDIT PLANNING AND BASIC AUDITING CONCEPTS ________________________________ 107
CHAPTER 3: AUDIT PLANNING, TYPES OF AUDIT TESTS, AND MATERIALITY ___________________________ 107
CHAPTER 4: RISK ASSESSMENT _______________________________________________________________ 168
CHAPTER 5: EVIDENCE AND DOCUMENTATION _________________________________________________ 218
PART 3: UNDERSTANDING AND AUDITING INTERNAL CONTROL _____________________________ 292
CHAPTER 6: INTERNAL CONTROL IN A FINANCIAL STATEMENT AUDIT _______________________________ 292
CHAPTER 7: AUDITING INTERNAL CONTROL OVER FINANCIAL REPORTING ___________________________ 371

PART 4: STATISTICAL AND NONSTATISTICAL SAMPLING TOOLS FOR AUDITING _______________ 423
CHAPTER 8: AUDIT SAMPLING: AN OVERVIEW AND APPLICATION TO TESTS OF CONTROLS _____________ 423
CHAPTER 9: AUDIT SAMPLING: AN APPLICATION TO SUBSTANTIVE TESTS OF ACCOUNT BALANCES _______ 478

PART 5: AUDITING BUSINESS PROCESSES _____________________________________________ 519
CHAPTER 10: AUDITING THE REVENUE PROCESS ________________________________________________ 519
CHAPTER 11: AUDITING THE PURCHASING PROCESS _____________________________________________ 595
CHAPTER 12: AUDITING THE HUMAN RESOURCE MANAGEMENT PROCESS ___________________________ 665
CHAPTER 13: AUDITING THE INVENTORY MANAGEMENT PROCESS _________________________________ 690
CHAPTER 14: AUDITING THE FINANCING/INVESTING PROCESS:PREPAID EXPENSES, INTANGIBLE ASSETS, AND
PROPERTY, PLANT, AND EQUIPMENT__________________________________________________________ 748
CHAPTER 15: AUDITING THE FINANCING/INVESTING PROCESS: LONG-TERM LIABILITIES, STOCKHOLDERS’
EQUITY, AND INCOME STATEMENT ACCOUNTS _________________________________________________ 799
CHAPTER 16: AUDITING THE FINANCING/INVESTING PROCESS: CASH AND INVESTMENTS ______________ 844

PART 6: COMPLETING THE AUDIT AND REPORTING RESPONSIBILITIES ______________________ 896
CHAPTER 17: COMPLETING THE AUDIT ENGAGEMENT ____________________________________________ 896
CHAPTER 18: REPORTS ON AUDITED FINANCIAL STATEMENTS _____________________________________ 968

PART 7: PROFESSIONAL RESPONSIBILITIES _____________________________________________ 1028
CHAPTER 19: PROFESSIONAL CONDUCT, INDEPENDENCE, AND QUALITY MANAGEMENT ______________ 1028
CHAPTER 20: LEGAL LIABILITY _______________________________________________________________ 1087

PART 8: ASSURANCE, ATTESTATION, AND INTERNAL AUDITING SERVICES ____________________ 1147
CHAPTER 21: ASSURANCE, ATTESTATION, AND INTERNAL AUDITING SERVICES ______________________ 1147

,PART 1: INTRODUCTION TO ASSURANCE AND FINANCIAL STATEMENT AUDITING
CHAPTER 1: AN INTRODUCTION TO ASSURANCE AND FINANCIAL STATEMENT AUDITING
WILLIAM MESSIER: AUDITING & ASSURANCE SERVICES: A SYSTEMATIC APPROACH 12TH
EDITION, (2022) TEST BANK


STUDENT NAME: __________________________________


MULTIPLE CHOICE

1) WHY DO AUDITORS OFTEN USE A SAMPLING APPROACH TO EVIDENCE
GATHERING?

A) AUDITORS ARE EXPERTS AND DO NOT NEED TO LOOK AT MUCH TO
KNOW WHETHER THE FINANCIAL STATEMENTS ARE CORRECT OR NOT.
B) AUDITORS MUST BALANCE THE COST OF THE AUDIT WITH THE NEED
FOR PRECISION AND FOR SOME TYPES OF EVIDENCE, COMPUTER DATA
ANALYTIC APPROACHES CAN’T BE USED.
C) AUDITORS MUST LIMIT THEIR EXPOSURE TO THEIR AUDITEE TO
MAINTAIN INDEPENDENCE.
D) THE AUDITOR'S RELATIONSHIP WITH THE AUDITEE IS GENERALLY
ADVERSARIAL, SO THE AUDITOR WILL NOT HAVE ACCESS TO ALL OF THE
FINANCIAL INFORMATION OF THE COMPANY.

ANSWER:> B
AUDITORS OFTEN USE SAMPLING BECAUSE THEY MUST BALANCE AUDIT
COST WITH THE NEED FOR PRECISION. A FULL REVIEW OF ALL EVIDENCE
MAY NOT BE FEASIBLE DUE TO TIME AND BUDGET CONSTRAINTS, AND
SOMETIMES, IT’S NOT POSSIBLE TO USE COMPUTER DATA ANALYTIC
APPROACHES. SAMPLING HELPS AUDITORS EFFICIENTLY ASSESS
EVIDENCE WITHOUT REVIEWING EVERY SINGLE TRANSACTION OR
DOCUMENT.

QUESTION DETAILS
AACSB: COMMUNICATION
AICPA: FN DECISION MAKING
ACCESSIBILITY: KEYBOARD NAVIGATION
DIFFICULTY: 1 EASY
AICPA: BB INDUSTRY
BLOOM’S: UNDERSTAND

, LEARNING OBJECTIVE: 01-05 UNDERSTAND WHY SAMPLING IS IMPORTANT IN
AN AUDIT. GRADABLE: AUTOMATIC
ACCESSIBILITY: SCREEN READER COMPATIBLE
TOPIC: THE AUDIT PROCESS




2) WHICH OF THE FOLLOWING STATEMENTS BEST DESCRIBES A
RELATIONSHIP BETWEEN SAMPLE SIZE AND OTHER ELEMENTS OF
AUDITING?

A) IF MATERIALITY INCREASES, SO WILL THE SAMPLE SIZE.
B) IF THE DESIRED LEVEL OF ASSURANCE INCREASES, SAMPLE SIZES CAN
BE SMALLER.
C) IF MATERIALITY DECREASES, SAMPLE SIZE WILL NEED TO INCREASE.
D) THERE IS NO RELATIONSHIP BETWEEN SAMPLE SIZE AND MATERIALITY
OR THE DESIRED LEVEL OF ASSURANCE.

ANSWER:> C
THE SAMPLE SIZE IS CLOSELY RELATED TO MATERIALITY AND THE
DESIRED LEVEL OF ASSURANCE. IF MATERIALITY DECREASES, AUDITORS
NEED TO SAMPLE A LARGER PORTION OF TRANSACTIONS TO ENSURE
THEY DON’T MISS SMALL BUT SIGNIFICANT ERRORS. A SMALLER
MATERIALITY THRESHOLD INCREASES THE LIKELIHOOD OF DETECTING
SMALLER MISSTATEMENTS, WHICH REQUIRES A LARGER SAMPLE SIZE.

QUESTION DETAILS
ACCESSIBILITY: KEYBOARD NAVIGATION
BLOOM’S: APPLY
DIFFICULTY: 2 MEDIUM
AICPA: BB CRITICAL THINKING AACSB: ANALYTICAL THINKING
AICPA: FN RISK ANALYSIS
LEARNING OBJECTIVE: 01-05 UNDERSTAND WHY SAMPLING IS IMPORTANT IN
AN AUDIT. GRADABLE: AUTOMATIC
ACCESSIBILITY: SCREEN READER COMPATIBLE
TOPIC: THE AUDIT PROCESS