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Auditing & Assurance Services 7th Edition by Louwers, Bagley, Strawser, Thibodeau, Sinason Practice Questions

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Auditing & Assurance Services 7th Edition by Louwers, Bagley, Strawser, Thibodeau, Sinason Practice Questions In an attestation engagement, a CPA practitioner is engaged to - CORRECT ANSWER-Prepare a written report containing a conclusion about the reliability of a management assertion.

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Auditing & Assurance Services 7th Edition by
Louwers, Bagley, Strawser, Thibodeau, Sinason
Practice Questions

Inzanzattestationzengagement,zazCPAzpractitionerziszengagedztoz-zCORRECTzANSWER-
Preparezazwrittenzreportzcontainingzazconclusionzaboutzthezreliabilityzofzazmanagementzassertion.



Bankerszwhozarezprocessingzloanzapplicationszfromzcompanieszseekingzlargezloanszwillzprobablyzaskzforzfi
nancialzstatementszauditedzbyzanzindependentzCPAzbecausez-zCORRECTzANSWER-
Theyzgenerallyzseezazpotentialzconflictzofzinterestzbetweenzcompanyzmanagerszwhozwantztozgetzloanszand
zthezbank'szneedszfor


reliablezfinancialzstatements.



Thezobjectivezinzanzauditor'szreviewzofzcreditzratingszofzazclient'szcustomerszisztozobtainzevidencezrelatedzt
ozmanagement'szassertionzaboutz-zCORRECTzANSWER-Valuationzandzallocation



Jones,zCPA,ziszplanningzthezauditzofzRhonda'szCompany.zRhondazverballyzassertsztozJoneszthatzallzexpense
szforzthezyearzhavezbeenzrecordedzinzthezaccounts.zRhonda'szrepresentationzinzthiszregardz-
zCORRECTzANSWER-

IsznotzconsideredzazsufficientzbasiszforzJonesztozconcludezthatzallzexpenseszhavezbeenzrecorded.



ThezSarbanes-OxleyzActzofz2002zgenerallyzprohibitszpubliczaccountingzfirmszfromz-zCORRECTzANSWER-
Actingzinzazmanagerialzdecision-
makingzrolezforzanzauditzclient,zauditingzthezfirm'szownzworkzonzanzauditzclient,zandzprovidingztaxzconsulti
ngztozanzauditzclientzwithoutzauditzcommitteezapproval.



Substantialzequivalencyzrefersztoz-zCORRECTzANSWER-
PermittingzazCPAztozpracticezinzanotherzstatezwithoutzhavingztozobtainzazlicensezinzthatzstate.



Whenzauditingzanzinvestmentzinzanotherzcompany,zanzauditorzmostzlikelyzwouldzseekztozconductzwhichza
uditzprocedureztozhelpzsatisfyzthezvaluationzassertion?z-zCORRECTzANSWER-
ObtainzmarketzquotationszfromzThezWallzStreetzJournalzorzanotherzindependentzsource.

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