Auditing & Assurance Services Test Bank | 2026 Edition | 1000+ Practice Questions, Answers & Explanations

,Auditingp&pAssurancepServices,p7ep(Louwers)p
Chapterp1p AuditingpandpAssurancepServices

1) Thepauditpobjectivepthatpallptransactionspandpaccountspthatpshouldpbeppresentedpinpthepfinancialps
tatementsparepinpfactpincludedpisprelatedptopwhichpofpthepPCAOBpassertions?
A) Existence.
B) Rightspandpobligations.
C) Completeness.
D) Valuation.pAn
swer:pCpDifficult
y:p1pEasy
Topic:p Management'spFinancialpStatementpAssertions
LearningpObjective:p01-
03pDescribepandpdefinepthepassertionspthatpmanagementpmakespaboutptheprecognition,pmeasuremen
t,ppresentation,pandpdisclosurepofpthepfinancialpstatementspandpexplainpwhypauditorspusepthempaspth
epfocalppointpofpthepaudit.
Blooms:p Remember
AACSB:pAnalyticalpThinkingpAcces
sibility:p KeyboardpNavigation

2) Cutoffptestspdesignedptopdetectppurchasespmadepbeforepthependpofpthepyearpthatphavepbeenpr
ecordedpinpthepsubsequentpyearpprovidepassurancepaboutpmanagement'spassertionpof:
A) presentationpandpdisclosure.
B) completeness.
C) rightspandpobligations.
D) existence.pAnswer
:p BpDifficulty:p2pMed
ium
Topic:p Management'spFinancialpStatementpAssertions
LearningpObjective:p01-
03pDescribepandpdefinepthepassertionspthatpmanagementpmakespaboutptheprecognition,pmeasuremen
t,ppresentation,pandpdisclosurepofpthepfinancialpstatementspandpexplainpwhypauditorspusepthempaspth
epfocalppointpofpthepaudit.
Blooms:p Remember
AACSB:pAnalyticalpThinkingpAcces
sibility:p KeyboardpNavigation




1
Copyrightp©p2018pMcGraw-Hill

,3) Duringpanpauditpofpanpentity'spstockholders'pequitypaccounts,pthepauditorpdeterminespwhetherpt
herepareprestrictionsponpretainedpearningspresultingpfromploans,pagreements,porpstateplaw.pThispau
ditpprocedurepmostplikelypispintendedptopverifypmanagement'spassertionpof:
A) existenceporpoccurrence.
B) completeness.
C) valuationporpallocation.
D) presentationpandpdisclosure.p
Answer:pD
Difficulty:p2pMedium
Topic:p Management'spFinancialpStatementpAssertions
LearningpObjective:p01-
03pDescribepandpdefinepthepassertionspthatpmanagementpmakespaboutptheprecognition,pmeasuremen
t,ppresentation,pandpdisclosurepofpthepfinancialpstatementspandpexplainpwhypauditorspusepthempaspth
epfocalppointpofpthepaudit.
Blooms:p Remember
AACSB:pAnalyticalpThinkingpAcces
sibility:p KeyboardpNavigation

4) Thepconfirmationpofpanpaccountppayablepbalancepselectedpfrompthepgeneralpledgerpprovidespp
rimarypevidencepregardingpwhichpmanagementpassertion?
A) Completeness.
B) Valuation.
C) Allocation.
D) Existence.pAnswe
r:p DpDifficulty:p2pMe
dium
Topic:p Management'spFinancialpStatementpAssertions
LearningpObjective:p01-
03pDescribepandpdefinepthepassertionspthatpmanagementpmakespaboutptheprecognition,pmeasuremen
t,ppresentation,pandpdisclosurepofpthepfinancialpstatementspandpexplainpwhypauditorspusepthempaspth
epfocalppointpofpthepaudit.
Blooms:p Remember
AACSB:pAnalyticalpThinkingpAcces
sibility:p KeyboardpNavigation

5) Whatptypepofpevidencepwouldpprovidepthephighestplevelpofpassurancepinpanpattestationpe
ngagement?
A) Evidencepsecuredpsolelypfrompwithinpthepentity.
B) Evidencepobtainedpfrompindependentpsources.
C) Evidencepobtainedpindirectly.
D) Evidencepobtainedpfrompmultiplepinternalpinquiries.p
Answer:pB
Difficulty:p3pHard
Topic:p Auditing,pAttestation,pandpAssurancepServices
LearningpObjective:p01-
02pDefinepandpcontrastpfinancialpstatementpauditing,pattestation,pandpassurancepservices.
Blooms:p Remember
2
Copyrightp©p2018pMcGraw-Hill

, AACSB:pAnalyticalpThinkingpAcces
sibility:p KeyboardpNavigation




3
Copyrightp©p2018pMcGraw-Hill