CPA Exam AUD -Complete Exam Study
Guide with Verified Answers |
Guaranteed A+
Each of the following is a required characteristic of a review engagement of management's
discussion and analysis (MD&A), EXCEPT:
A) It consists principally of applying tests of details through inspection, observation, and
confirmation.
B) The practitioner applies analytical procedures.
C) An objective is to report if any information came to the practitioner's attention that the
MD&A is NOT reasonably presented.
D) The practitioner makes inquiries of individuals responsible for financial matters ------- ✔
CORRECT ANSWER ✓✓A) It consists principally of applying tests of details through inspection,
observation, and confirmation.
Banister, a CPA, is approached by Wagner, a client. Wagner requests that Banister return the
records provided to Banister by Wagner during an audit. Wagner still owes Banister the fees
associated with the audit. According to the AICPA Code of Professional Conduct, what should
Banister do?
A) Banister should return the records to Wagner.
B) Banister should return the records to Wagner only after the fee has been paid.
C) Banister should NOT return the records to Wagner because the records now belong to
Banister.
, D) Banister should NOT return the records to Wagner without a court order. ------- ✔ CORRECT
ANSWER ✓✓A) Banister should return the records to Wagner.
An accountant's working papers for an engagement to review the financial statements of a
nonpublic entity would be LEAST likely to include which of the following forms of
documentation?
A) Study and evaluation of internal control.
B) Explanation of analytical procedures performed.
C) A copy of the engagement letter.
D) Copies of representation letters from client management. ------- ✔ CORRECT ANSWER ✓✓A)
Study and evaluation of internal control.
If differences of opinion arise between the engagement partner and the engagement quality
control reviewer, then the engagement partner should:
A) Follow the firm's policies and procedures for resolving differences of opinion.
B) Issue a disclaimer of opinion and report the issue to the entity's audit committee.
C) Discuss the differences of opinion with the entity's management and issue a modified
auditor's report.
D) Withdraw from the engagement when permissible under law or regulation. ------- ✔
CORRECT ANSWER ✓✓A) Follow the firm's policies and procedures for resolving differences of
opinion.
An accountant is reviewing the financial statements of a nonpublic entity in accordance with
Statements on Standards for Accounting and Review Services (SSARS). The accountant most
likely would perform which of the following procedures?
A) Obtain an understanding of the internal control structure.
Guide with Verified Answers |
Guaranteed A+
Each of the following is a required characteristic of a review engagement of management's
discussion and analysis (MD&A), EXCEPT:
A) It consists principally of applying tests of details through inspection, observation, and
confirmation.
B) The practitioner applies analytical procedures.
C) An objective is to report if any information came to the practitioner's attention that the
MD&A is NOT reasonably presented.
D) The practitioner makes inquiries of individuals responsible for financial matters ------- ✔
CORRECT ANSWER ✓✓A) It consists principally of applying tests of details through inspection,
observation, and confirmation.
Banister, a CPA, is approached by Wagner, a client. Wagner requests that Banister return the
records provided to Banister by Wagner during an audit. Wagner still owes Banister the fees
associated with the audit. According to the AICPA Code of Professional Conduct, what should
Banister do?
A) Banister should return the records to Wagner.
B) Banister should return the records to Wagner only after the fee has been paid.
C) Banister should NOT return the records to Wagner because the records now belong to
Banister.
, D) Banister should NOT return the records to Wagner without a court order. ------- ✔ CORRECT
ANSWER ✓✓A) Banister should return the records to Wagner.
An accountant's working papers for an engagement to review the financial statements of a
nonpublic entity would be LEAST likely to include which of the following forms of
documentation?
A) Study and evaluation of internal control.
B) Explanation of analytical procedures performed.
C) A copy of the engagement letter.
D) Copies of representation letters from client management. ------- ✔ CORRECT ANSWER ✓✓A)
Study and evaluation of internal control.
If differences of opinion arise between the engagement partner and the engagement quality
control reviewer, then the engagement partner should:
A) Follow the firm's policies and procedures for resolving differences of opinion.
B) Issue a disclaimer of opinion and report the issue to the entity's audit committee.
C) Discuss the differences of opinion with the entity's management and issue a modified
auditor's report.
D) Withdraw from the engagement when permissible under law or regulation. ------- ✔
CORRECT ANSWER ✓✓A) Follow the firm's policies and procedures for resolving differences of
opinion.
An accountant is reviewing the financial statements of a nonpublic entity in accordance with
Statements on Standards for Accounting and Review Services (SSARS). The accountant most
likely would perform which of the following procedures?
A) Obtain an understanding of the internal control structure.
