ACA Assurance Test Questions with Correct Answers Latest 2025
how is assurance expressed? - Answers in an assurance report with a negative or positive conclusion
given
what is an assurance engagement? - Answers one in which a practitioner expresses a conclusion
designed to enhance the degree of confidence of the intended users other than the responsible party
about the outcome of the evaluation or measurement of a subject matter against criteria.
What are the key elements of an assurance engagement? - Answers 1. three party relationship
2. a subject matter
3. suitable criteria
4. sufficient appropriate evidence to support the assurance opinion
5. a written report providing an opinion on the subject matter
what 3 things are included in the three party relationship? - Answers 1. practitioner
2. intended user
3. responsible party
What does the practitioner do in a three party relationship? - Answers provide assurance
what does the intended user do in a three party relationship? - Answers require assurance
what does the responsible party do in a three party relationship? - Answers prepared the subject matter
that needs revised
What are the two types of assurance engagement conducted by practitioners? - Answers 1. reasonable
assurance engagement
2. limited assurance engagement
What are the features of reasonable assurance? - Answers sufficient and appropriate evidence, positive
opinion, outward expression
What are the features of limited assurance? - Answers sufficient and appropriate, negative conclusion
Is reasonable assurance a statutory audit? - Answers yes
examples of assurance engagements required by regulators - Answers 1. bank audits
2. pension scheme audits
3. charity audits
,4. solicitors audits
who are bank audits required by? - Answers financial conduct authority
examples of voluntary engagements - Answers 1. environmental audits
2. due diligence
3. internal audit
4. fraud investigations
What is the act that requires all companies of a certain size to have an audit by law? - Answers
Companies act 2006
What is the objective of an audit of financial statements? - Answers to enable the auditor to express an
opinion whether the financial statements are prepared, in all material respects, in accordance with an
applicable financial reporting framework
what is an expression of reasonable assurance? - Answers true and fair view
what does true mean? - Answers 1. information is factual and conforms with reality
2. information conforms with required standards and law
3. correctly extracted from books and records
what does fair mean? - Answers 1. free from discrimination and bias
2. accounts should reflect the commercial substance of underlying transactions
What does the companies act 2006 require? - Answers auditors of members of a RSB
what is RSB? - Answers recognised supervisory board
what is an example of the RSB? - Answers ICAEW
What is the RSB responsible for ensuring? - Answers 1. only individuals holding an appropriate
qualification can conduct audits
2. those individuals or firms are monitored on a regular basis
What is the financial reporting council (FRC) responsible for? - Answers 1. monitoring the accounting
profession and issuing auditing standards through its codes and standards committee
2. issuing ethical standards
What has the codes and standards committee adopted? - Answers international standards on auditing
, who reviews audits of listed companies? - Answers FRC
who review audits of unlisted companies ? - Answers ICAEW
What does USA 200 Overall Objectives of the independent auditor state auditors should do? - Answers
1. obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error
2. report on the financial statements and communicate as required by the ISAs
What 4 things must an auditor do? - Answers 1. comply with relevant ethical requirements
2. plan and perform audit with professional scepticism
3. exercise professional judgement
4. obtain audit evidence that is both sufficient and appropriate
what are features of professional scepticism? - Answers 1. questioning mind
2. being alert to conditions which may indicate possible misstatement
3. maintain critical assessment
What are the stages of an audit? - Answers 1. obtaining an engagement
2. engagement planning
3. performing procedures
4. review and completion
5. reporting
two users of an audit - Answers 1. shareholders of a company
2. board of directors
what are the benefits of assurance to the shareholders? - Answers independent, professional
verification
what are the benefits of assurance to the board of directors? - Answers 1. prevent errors or frauds
2. reduce risk of management bias
3. act as a deterrent
what 2 of 3 requirements must a company meet to not require an audit? - Answers 1. turnover of less
than 10.2 million
how is assurance expressed? - Answers in an assurance report with a negative or positive conclusion
given
what is an assurance engagement? - Answers one in which a practitioner expresses a conclusion
designed to enhance the degree of confidence of the intended users other than the responsible party
about the outcome of the evaluation or measurement of a subject matter against criteria.
What are the key elements of an assurance engagement? - Answers 1. three party relationship
2. a subject matter
3. suitable criteria
4. sufficient appropriate evidence to support the assurance opinion
5. a written report providing an opinion on the subject matter
what 3 things are included in the three party relationship? - Answers 1. practitioner
2. intended user
3. responsible party
What does the practitioner do in a three party relationship? - Answers provide assurance
what does the intended user do in a three party relationship? - Answers require assurance
what does the responsible party do in a three party relationship? - Answers prepared the subject matter
that needs revised
What are the two types of assurance engagement conducted by practitioners? - Answers 1. reasonable
assurance engagement
2. limited assurance engagement
What are the features of reasonable assurance? - Answers sufficient and appropriate evidence, positive
opinion, outward expression
What are the features of limited assurance? - Answers sufficient and appropriate, negative conclusion
Is reasonable assurance a statutory audit? - Answers yes
examples of assurance engagements required by regulators - Answers 1. bank audits
2. pension scheme audits
3. charity audits
,4. solicitors audits
who are bank audits required by? - Answers financial conduct authority
examples of voluntary engagements - Answers 1. environmental audits
2. due diligence
3. internal audit
4. fraud investigations
What is the act that requires all companies of a certain size to have an audit by law? - Answers
Companies act 2006
What is the objective of an audit of financial statements? - Answers to enable the auditor to express an
opinion whether the financial statements are prepared, in all material respects, in accordance with an
applicable financial reporting framework
what is an expression of reasonable assurance? - Answers true and fair view
what does true mean? - Answers 1. information is factual and conforms with reality
2. information conforms with required standards and law
3. correctly extracted from books and records
what does fair mean? - Answers 1. free from discrimination and bias
2. accounts should reflect the commercial substance of underlying transactions
What does the companies act 2006 require? - Answers auditors of members of a RSB
what is RSB? - Answers recognised supervisory board
what is an example of the RSB? - Answers ICAEW
What is the RSB responsible for ensuring? - Answers 1. only individuals holding an appropriate
qualification can conduct audits
2. those individuals or firms are monitored on a regular basis
What is the financial reporting council (FRC) responsible for? - Answers 1. monitoring the accounting
profession and issuing auditing standards through its codes and standards committee
2. issuing ethical standards
What has the codes and standards committee adopted? - Answers international standards on auditing
, who reviews audits of listed companies? - Answers FRC
who review audits of unlisted companies ? - Answers ICAEW
What does USA 200 Overall Objectives of the independent auditor state auditors should do? - Answers
1. obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error
2. report on the financial statements and communicate as required by the ISAs
What 4 things must an auditor do? - Answers 1. comply with relevant ethical requirements
2. plan and perform audit with professional scepticism
3. exercise professional judgement
4. obtain audit evidence that is both sufficient and appropriate
what are features of professional scepticism? - Answers 1. questioning mind
2. being alert to conditions which may indicate possible misstatement
3. maintain critical assessment
What are the stages of an audit? - Answers 1. obtaining an engagement
2. engagement planning
3. performing procedures
4. review and completion
5. reporting
two users of an audit - Answers 1. shareholders of a company
2. board of directors
what are the benefits of assurance to the shareholders? - Answers independent, professional
verification
what are the benefits of assurance to the board of directors? - Answers 1. prevent errors or frauds
2. reduce risk of management bias
3. act as a deterrent
what 2 of 3 requirements must a company meet to not require an audit? - Answers 1. turnover of less
than 10.2 million
