WGU D251 - Advanced Auditing
QUESTIONS AND CORRECT VERIFIED
ANSWERS ALREADY GRADED A+ 100%
GUARANTEED PASS!
misstatement - AnswerAn error, either intentional or unintentional, that exists in a
transaction or financial statement account balance.
alternative procedures - AnswerProcedures used to obtain evidence about the
existence and valuation of accounts receivable when a positive confirmation is not
returned, including examining cash collected after the confirmation date and vouching
unpaid invoices to customers' orders, sales orders, shipping documents, and sales
invoices.
Altman Z-scores - AnswerA series of ratios that have predictive power in indicating
the likelihood of bankruptcy. This score is named for the person who first introduced the
concept and associated measurement.
attribute - AnswerA characteristic of the population of interest to the auditor.
Attributes sampling - AnswerA statistical sampling method used to estimate the rate
of control procedure failures based on selecting one sample and performing the
appropriate audit procedure.
Audit Risk - AnswerThe risk that the auditor expresses an inappropriate audit
opinion when the financial statements are materially misstated.
Audit Risk Model - AnswerAudit Risk = Inherent Risk X Control Risk X Detention
Risk
audit risk model - AnswerA conceptual depiction of the relationship between inherent
risk, control risk, detection risk, and audit risk.
Audit sampling - AnswerThe application of an audit procedure to less than 100% of
the items within an account balance or class of transactions for the purpose of
evaluating some characteristic of the balance or class.
,audit scope - AnswerThe range of accounts and transactions that the auditor
evaluates, along with the amount of evidence that they gather, assessments of which
accounts and transactions are material, as well as the critical areas where the auditor
employed significant assumptions and made associated professional judgments.
auditor business risk - AnswerThis risk reflects the potential for loss to the auditor
that the client poses, including being a publicly traded client, not being a profitable
engagement, damaging the auditor's reputation, and/or potential litigation relating to the
engagement.
auditor-detected misstatements - AnswerSuch a misstatement occurs when, during
the audit, the auditor comes to find that there exists an error in the recording of a
particular transaction, regardless of whether it was intentional or unintentional.
automated purchasing system - AnswerA networked software system that links a
company's website to other vendors whose offerings and prices have been preapproved
by appropriate management.
Basic precision - AnswerThe amount of uncertainty associated with testing only a
part of the population (sampling risk). Basic precision is calculated as the sampling
interval multiplied by a confidence factor.
big data - AnswerHigh volume, high velocity, and/or high variety information assets
that require new forms of processing to enable enhanced decision making, insight
discovery, and process optimization.
Block sampling - AnswerA sampling technique that involves selecting a sample that
consists of contiguous population items, such as selecting transactions by day or week.
brainstorming - AnswerA group discussion designed to encourage auditors to
creatively assess client risks, particularly those relevant to the possible existence of
fraud in the organization.
business intelligence - AnswerThe process of transforming all of the raw data that
companies (providers) collect from their various operations into actionable information.
busy season - AnswerAn error, either intentional or unintentional, that exists An
intensive time of the year during which the auditor faces the greatest deadline pressure
and work volume based upon the need to provide assurance over the client's financial
reports.
Client business risks - AnswerRisks affecting the business operations and potential
outcomes of an organization's activities.
, Collectibility - AnswerThe risk that the seller will be unable to collect the entitled
contractual consideration from the customer.
component - AnswerAn entity or business activity for which group or component
management prepares financial information that is required by the applicable financial
reporting framework to be included in the group financial statements.
component auditor - AnswerAn auditor who performs work on the financial
information of a component that will be used as audit evidence for the group audit. A
component auditor may be part of the group engagement partner's firm, a network firm
of the group engagement partner's firm, or another firm.
concurring partner review - AnswerA review at the end of each audit conducted by
an experienced auditor, usually a partner, who was not a part of the audit team, but who
has appropriate competence, independence, integrity, and objectivity. The purpose of
this review is to help make sure that the audit and audit documentation are complete
and support the audit opinion on the financial statements and, for public companies, on
the client's internal controls.
Control Risk - AnswerThe risk that a misstatement that could occur in an assertion
about a class of transaction, account balance, or disclosure and that could be material,
either individually or when aggregated with other misstatements, will not be prevented,
or detected and corrected, on a timely basis by the entity's internal control.
corruption perception index - AnswerA ranking put forth by Transparency
International that ranks countries according to the extent to which people believe
corruption exists; the ranking includes about 200 countries and ranks them on a scale
from 0 to 10 (0 5 high corruption; 10 5 low corruption).
critical audit matter - AnswerAny matter that was communicated or required to be
communicated to the audit committee, relating to accounts or disclosures material to the
financial statements, and involving especially challenging, subjective, or complex
auditor judgment.
Cycle counts - AnswerPeriodic testing of the accuracy of the perpetual inventory
record by counting all inventories on a cyclical basis.
Data analytics tools - AnswerQualitative and quantitative techniques and processes
that auditors use to enhance their productivity and effectiveness; auditors extract,
categorize, identify and analyze patterns or trends in the data; data analytics tools vary
according to organizational requirements.
QUESTIONS AND CORRECT VERIFIED
ANSWERS ALREADY GRADED A+ 100%
GUARANTEED PASS!
misstatement - AnswerAn error, either intentional or unintentional, that exists in a
transaction or financial statement account balance.
alternative procedures - AnswerProcedures used to obtain evidence about the
existence and valuation of accounts receivable when a positive confirmation is not
returned, including examining cash collected after the confirmation date and vouching
unpaid invoices to customers' orders, sales orders, shipping documents, and sales
invoices.
Altman Z-scores - AnswerA series of ratios that have predictive power in indicating
the likelihood of bankruptcy. This score is named for the person who first introduced the
concept and associated measurement.
attribute - AnswerA characteristic of the population of interest to the auditor.
Attributes sampling - AnswerA statistical sampling method used to estimate the rate
of control procedure failures based on selecting one sample and performing the
appropriate audit procedure.
Audit Risk - AnswerThe risk that the auditor expresses an inappropriate audit
opinion when the financial statements are materially misstated.
Audit Risk Model - AnswerAudit Risk = Inherent Risk X Control Risk X Detention
Risk
audit risk model - AnswerA conceptual depiction of the relationship between inherent
risk, control risk, detection risk, and audit risk.
Audit sampling - AnswerThe application of an audit procedure to less than 100% of
the items within an account balance or class of transactions for the purpose of
evaluating some characteristic of the balance or class.
,audit scope - AnswerThe range of accounts and transactions that the auditor
evaluates, along with the amount of evidence that they gather, assessments of which
accounts and transactions are material, as well as the critical areas where the auditor
employed significant assumptions and made associated professional judgments.
auditor business risk - AnswerThis risk reflects the potential for loss to the auditor
that the client poses, including being a publicly traded client, not being a profitable
engagement, damaging the auditor's reputation, and/or potential litigation relating to the
engagement.
auditor-detected misstatements - AnswerSuch a misstatement occurs when, during
the audit, the auditor comes to find that there exists an error in the recording of a
particular transaction, regardless of whether it was intentional or unintentional.
automated purchasing system - AnswerA networked software system that links a
company's website to other vendors whose offerings and prices have been preapproved
by appropriate management.
Basic precision - AnswerThe amount of uncertainty associated with testing only a
part of the population (sampling risk). Basic precision is calculated as the sampling
interval multiplied by a confidence factor.
big data - AnswerHigh volume, high velocity, and/or high variety information assets
that require new forms of processing to enable enhanced decision making, insight
discovery, and process optimization.
Block sampling - AnswerA sampling technique that involves selecting a sample that
consists of contiguous population items, such as selecting transactions by day or week.
brainstorming - AnswerA group discussion designed to encourage auditors to
creatively assess client risks, particularly those relevant to the possible existence of
fraud in the organization.
business intelligence - AnswerThe process of transforming all of the raw data that
companies (providers) collect from their various operations into actionable information.
busy season - AnswerAn error, either intentional or unintentional, that exists An
intensive time of the year during which the auditor faces the greatest deadline pressure
and work volume based upon the need to provide assurance over the client's financial
reports.
Client business risks - AnswerRisks affecting the business operations and potential
outcomes of an organization's activities.
, Collectibility - AnswerThe risk that the seller will be unable to collect the entitled
contractual consideration from the customer.
component - AnswerAn entity or business activity for which group or component
management prepares financial information that is required by the applicable financial
reporting framework to be included in the group financial statements.
component auditor - AnswerAn auditor who performs work on the financial
information of a component that will be used as audit evidence for the group audit. A
component auditor may be part of the group engagement partner's firm, a network firm
of the group engagement partner's firm, or another firm.
concurring partner review - AnswerA review at the end of each audit conducted by
an experienced auditor, usually a partner, who was not a part of the audit team, but who
has appropriate competence, independence, integrity, and objectivity. The purpose of
this review is to help make sure that the audit and audit documentation are complete
and support the audit opinion on the financial statements and, for public companies, on
the client's internal controls.
Control Risk - AnswerThe risk that a misstatement that could occur in an assertion
about a class of transaction, account balance, or disclosure and that could be material,
either individually or when aggregated with other misstatements, will not be prevented,
or detected and corrected, on a timely basis by the entity's internal control.
corruption perception index - AnswerA ranking put forth by Transparency
International that ranks countries according to the extent to which people believe
corruption exists; the ranking includes about 200 countries and ranks them on a scale
from 0 to 10 (0 5 high corruption; 10 5 low corruption).
critical audit matter - AnswerAny matter that was communicated or required to be
communicated to the audit committee, relating to accounts or disclosures material to the
financial statements, and involving especially challenging, subjective, or complex
auditor judgment.
Cycle counts - AnswerPeriodic testing of the accuracy of the perpetual inventory
record by counting all inventories on a cyclical basis.
Data analytics tools - AnswerQualitative and quantitative techniques and processes
that auditors use to enhance their productivity and effectiveness; auditors extract,
categorize, identify and analyze patterns or trends in the data; data analytics tools vary
according to organizational requirements.
