AUDITING THEORY REVIEW
QUESTION 2 WITH COMPLETE
OPTION
Aside from engagement standards, the AASC issues documents which aim to provide interpretive
guidance and practical assistance to professional accountants in implementing Philippine Standards
on Auditing and to promote good practice. These are known as
A. PAPSs
B. PREPSs
C. PAEPSs
D. PRSPSs ANSW✅✅A
The generally accepted auditing standards established by the Auditing and Assurance Standards
Council apply
A. Only to the PICPA membership
B. To all CPAs
C. Only to those who choose to follow them
D. Only when conducting audits ANSW✅✅B
A professional accountant who does not consider and apply the guidance included in a relevant
Practice Statement should be prepared to
A. Explain to the Board of Accountancy tribunal why the practice statement was not complied with
B. Bear the consequences of such non-compliance, such as suspension or revocation of license, plus
imprisonment of not more than two years
C. Face the shareholders of the entity, and explain in the meeting why such practice statement was
not complied with, provided that the explanation is also put in writing, and signed in the presence of
the Chairperson of the Auditing and Assurance Standards Council
D. Explain how the basic principles and essential procedures in the Engagement Standards addressed
by the Practice Statements have been complied with ANSW✅✅D
QUESTION 2 WITH COMPLETE
OPTION
Aside from engagement standards, the AASC issues documents which aim to provide interpretive
guidance and practical assistance to professional accountants in implementing Philippine Standards
on Auditing and to promote good practice. These are known as
A. PAPSs
B. PREPSs
C. PAEPSs
D. PRSPSs ANSW✅✅A
The generally accepted auditing standards established by the Auditing and Assurance Standards
Council apply
A. Only to the PICPA membership
B. To all CPAs
C. Only to those who choose to follow them
D. Only when conducting audits ANSW✅✅B
A professional accountant who does not consider and apply the guidance included in a relevant
Practice Statement should be prepared to
A. Explain to the Board of Accountancy tribunal why the practice statement was not complied with
B. Bear the consequences of such non-compliance, such as suspension or revocation of license, plus
imprisonment of not more than two years
C. Face the shareholders of the entity, and explain in the meeting why such practice statement was
not complied with, provided that the explanation is also put in writing, and signed in the presence of
the Chairperson of the Auditing and Assurance Standards Council
D. Explain how the basic principles and essential procedures in the Engagement Standards addressed
by the Practice Statements have been complied with ANSW✅✅D
