Matching questions
1-70 of 70
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Which statement accurately describes the nature of detective controls?
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They identify whether errors have occurred.
Which classification should be used for a deficiency in internal control that would
affect the decisions of the users of financial statements?
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Material weakness
Which combination of assessed inherent risk and control risk will require the greatest
amount of sufficient evidence?
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High inherent risk, high control risk
An auditor obtains an audit client's accounts receivables balances for the year. The
book value of accounts receivable is $5,000,000. The auditor sets a tolerable
misstatement at $250,000 (5% of the book value of the population).
The auditor stratifies the population and randomly selects 25 accounts from each
level as a sample for testing. After testing, the total estimated overstatement of the
accounts receivable is more than $250,000. The auditor would like to obtain a lower
level of sampling
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Apply alternate audit procedures
A CPA firm provides tax services for a large automotive client. Over the years, the
client has continually pushed for aggressive tax strategies that the CPA does not
always agree with.
While performing the current year tax return, the client threatens to discontinue the
relationship with the CPA firm if they continue to disagree with the strategies
, presented.
Which type of threat to ethical decision-making is demonstrated by this practice?
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Undue influence
During fieldwork, an auditor noted several significant subsequent events that arose
after the balance sheet date. The auditor has reviewed the client's footnote disclosure
for the subsequent events and believes the disclosure is appropriate. However, the
auditor is concerned that a financial statement user may reach improper conclusions
about the client's financial condition if the disclosure about subsequent events is not
noted by the user.
How should the auditor respond to this situation?
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Include an emphasis-of-matter paragraph after the opinion in the audit
report
A CPA has prepared a couple's joint tax returns for 10 years, but the couple is now
experiencing a complicated divorce where both parties wish to claim the same child
as a dependent. The CPA agrees to work with both clients on their tax returns.
Which standard of the AICPA Code of Professional Conduct is being violated by this
CPA's action?
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1-70 of 70
Click a definition to match it with a term
Which statement accurately describes the nature of detective controls?
Give this one a try later!
They identify whether errors have occurred.
Which classification should be used for a deficiency in internal control that would
affect the decisions of the users of financial statements?
,Give this one a try later!
Material weakness
Which combination of assessed inherent risk and control risk will require the greatest
amount of sufficient evidence?
Give this one a try later!
High inherent risk, high control risk
An auditor obtains an audit client's accounts receivables balances for the year. The
book value of accounts receivable is $5,000,000. The auditor sets a tolerable
misstatement at $250,000 (5% of the book value of the population).
The auditor stratifies the population and randomly selects 25 accounts from each
level as a sample for testing. After testing, the total estimated overstatement of the
accounts receivable is more than $250,000. The auditor would like to obtain a lower
level of sampling
Give this one a try later!
Apply alternate audit procedures
A CPA firm provides tax services for a large automotive client. Over the years, the
client has continually pushed for aggressive tax strategies that the CPA does not
always agree with.
While performing the current year tax return, the client threatens to discontinue the
relationship with the CPA firm if they continue to disagree with the strategies
, presented.
Which type of threat to ethical decision-making is demonstrated by this practice?
Give this one a try later!
Undue influence
During fieldwork, an auditor noted several significant subsequent events that arose
after the balance sheet date. The auditor has reviewed the client's footnote disclosure
for the subsequent events and believes the disclosure is appropriate. However, the
auditor is concerned that a financial statement user may reach improper conclusions
about the client's financial condition if the disclosure about subsequent events is not
noted by the user.
How should the auditor respond to this situation?
Give this one a try later!
Include an emphasis-of-matter paragraph after the opinion in the audit
report
A CPA has prepared a couple's joint tax returns for 10 years, but the couple is now
experiencing a complicated divorce where both parties wish to claim the same child
as a dependent. The CPA agrees to work with both clients on their tax returns.
Which standard of the AICPA Code of Professional Conduct is being violated by this
CPA's action?
Give this one a try later!
