100%
AUE1501
EXAM PACK
DISTINCTION QUALITY
UNISA EXAM
, UNIVERSITY EXAMINATIONS
AUE1501
INTRODUCTION TO AUDITING
Duration 2 Hours 100 Marks
EXAMINATION PANEL AS APPOINTED BY THE DEPARTMENT.
Use of a non-programmable pocket calculator is permissible
Closed book examination.
This examination question paper remains the property of the University of South Africa and may not be
removed from the examination venue
THIS EXAMINATION QUESTION PAPER CONSISTS OF FOUR (4) PAGES.
This paper consists of 6 questions and includes the following mam topics
PART MAIN TOPIC MARKS
1. True or false statements 10
2. Characteristics of a pnvate company 15
3. The internal and external auditor 18
4. Auditing concepts and definitions 24
5. Assertions 8
6. Purchases and payment cycle 25
NOTE:
Although the pnmary purpose of the examination is to test a candidate’s knowledge and
application of the subject matter, the examiner will consider the ability to organise and present
such knowledge in acceptable written language
,QUESTION 1 10 marks
REQUIRED
Indicate whether the following statements are true or false and provide a reason for your
answer Write down the number of the subsection and the word “True” or “False" next to it
and then provide the reason for your answer Answer the questions in numerical sequence,
for example
1.1 True. Reason
1.2 False Reason
(Each subsection counts two (2) marks )
1.1 An external auditor is appointed to assess the efficiency, cost and effectiveness of the
company’s internal control systems
1.2 Test of controls are procedures performed by the auditor to collect evidence about
assertions for classes of transactions and events for the year under review
1.3 The key aspects of the King III report are to bung about respect and honesty to society
1.4 The mam role of the internal auditor is to support the external auditor with the collection
of audit evidence.
1.5 Professional competency is not a pnnciple of professional conduct for internal auditors
but only for external auditors
QUESTION 2 15 marks
Your friend is thinking of starting a new business in the form of a private company He is
unsure of some of the advantages and disadvantages involved in forming a private company
and made the following statements
2.1 “When I pass away one day my children can carry on with the business as a private
company ”
2.2 “For a private company, if the public interest score is 150 an audit must be performed ”
2.3 “A pnvate company must prepare annual financial statements within eight months after
every year-end ”
2.4 “It is simple to set up a private company because it requires only a few legal
requirements.”
, 2.5 “A director of a company cannot be held personally liable for debts incurred by the
company ”
2.6 “Corporate governance does not apply to private companies ”
REQUIRED
State whether you either agree or disagree with the above statements, and provide a reason
in each case Set out your answer in the following format
iNumbei « A
‘"SS .S.A- : -
2.1 • • •• •
QUESTION 3 18 marks
Internal and external auditors serve different purposes In certain circumstances the external
auditor can rely on the work performed by the internal auditor.
REQUIRED Marks
3.1 List three (3) differences between internal and external auditors (Present
your solution in a tabular format ) (9)
3.2 Describe six (6) considerations that the external auditor should take into
account in order to evaluate the work done by the internal auditor (9)
QUESTION 4 24 marks
External auditors play an important assurance role in the financial world Certain concepts
and terms are relevant to the auditing profession.
REQUIRED Marks
4.1 Describe the mam role of a registered external auditor (2)
4.2 Define the term materiality (3)
4.3 Mention four (4) inherent limitations of an internal control system (6)
4.4 List three (3) types of modified opinions that the auditor can issue (3)
4.5 List seven (7) cntena which should be satisfied by a registered auditor
before an unmodified (unqualified) audit opinion can be expressed (10)
AUE1501
EXAM PACK
DISTINCTION QUALITY
UNISA EXAM
, UNIVERSITY EXAMINATIONS
AUE1501
INTRODUCTION TO AUDITING
Duration 2 Hours 100 Marks
EXAMINATION PANEL AS APPOINTED BY THE DEPARTMENT.
Use of a non-programmable pocket calculator is permissible
Closed book examination.
This examination question paper remains the property of the University of South Africa and may not be
removed from the examination venue
THIS EXAMINATION QUESTION PAPER CONSISTS OF FOUR (4) PAGES.
This paper consists of 6 questions and includes the following mam topics
PART MAIN TOPIC MARKS
1. True or false statements 10
2. Characteristics of a pnvate company 15
3. The internal and external auditor 18
4. Auditing concepts and definitions 24
5. Assertions 8
6. Purchases and payment cycle 25
NOTE:
Although the pnmary purpose of the examination is to test a candidate’s knowledge and
application of the subject matter, the examiner will consider the ability to organise and present
such knowledge in acceptable written language
,QUESTION 1 10 marks
REQUIRED
Indicate whether the following statements are true or false and provide a reason for your
answer Write down the number of the subsection and the word “True” or “False" next to it
and then provide the reason for your answer Answer the questions in numerical sequence,
for example
1.1 True. Reason
1.2 False Reason
(Each subsection counts two (2) marks )
1.1 An external auditor is appointed to assess the efficiency, cost and effectiveness of the
company’s internal control systems
1.2 Test of controls are procedures performed by the auditor to collect evidence about
assertions for classes of transactions and events for the year under review
1.3 The key aspects of the King III report are to bung about respect and honesty to society
1.4 The mam role of the internal auditor is to support the external auditor with the collection
of audit evidence.
1.5 Professional competency is not a pnnciple of professional conduct for internal auditors
but only for external auditors
QUESTION 2 15 marks
Your friend is thinking of starting a new business in the form of a private company He is
unsure of some of the advantages and disadvantages involved in forming a private company
and made the following statements
2.1 “When I pass away one day my children can carry on with the business as a private
company ”
2.2 “For a private company, if the public interest score is 150 an audit must be performed ”
2.3 “A pnvate company must prepare annual financial statements within eight months after
every year-end ”
2.4 “It is simple to set up a private company because it requires only a few legal
requirements.”
, 2.5 “A director of a company cannot be held personally liable for debts incurred by the
company ”
2.6 “Corporate governance does not apply to private companies ”
REQUIRED
State whether you either agree or disagree with the above statements, and provide a reason
in each case Set out your answer in the following format
iNumbei « A
‘"SS .S.A- : -
2.1 • • •• •
QUESTION 3 18 marks
Internal and external auditors serve different purposes In certain circumstances the external
auditor can rely on the work performed by the internal auditor.
REQUIRED Marks
3.1 List three (3) differences between internal and external auditors (Present
your solution in a tabular format ) (9)
3.2 Describe six (6) considerations that the external auditor should take into
account in order to evaluate the work done by the internal auditor (9)
QUESTION 4 24 marks
External auditors play an important assurance role in the financial world Certain concepts
and terms are relevant to the auditing profession.
REQUIRED Marks
4.1 Describe the mam role of a registered external auditor (2)
4.2 Define the term materiality (3)
4.3 Mention four (4) inherent limitations of an internal control system (6)
4.4 List three (3) types of modified opinions that the auditor can issue (3)
4.5 List seven (7) cntena which should be satisfied by a registered auditor
before an unmodified (unqualified) audit opinion can be expressed (10)
