AUD - CPA Exam - Professional Responsibilities || errorless
solutions 100%.
Under the ethical standards of the profession, which of the following positions would be
considered a position of significant influence in an audit client?
A) A marketing position related to the client's primary products.
B) A policy-making position in the client's finance division.
C) A staff position in the client's research and development division.
D) A senior position in the client's human resources division. correct answers B) A policy-
making position in the client's finance division.
An integrated audit performed under the Sarbanes-Oxley Act includes auditor opinion on
A) Financial Statements
B) Internal Control
C) Both
D) Neither correct answers C) Both
ABC Company is audited by the Albuquerque office of Whitt CPAs. Which of the following
individuals would be least likely to be considered a "covered member" by the AICPA Code of
Professional Conduct independence standard?
A) Staff assistant on the audit.
B) An audit partner in the Silver Springs office who performs no attest services for ABC
Company.
C) A tax partner in Albuquerque who performs no attest services for ABC Company or for any
other firm clients.
,D) The partner in charge of Whitt CPAs (she does not work on the ABC Company audit). correct
answers B) An audit partner in the Silver Springs office who performs no attest services for ABC
Company.
Which of the following is not a broad category of safeguards that mitigate or eliminate threats to
independence?
A) Safeguards created by the profession, legislation, or regulation.
B) Safeguards created by peers who performed the audit in the preceding year.
C) Safeguards implemented by the firm, including policies and procedures to implement
professional and regulatory requirements.
D) Safeguards implemented by the attest client. correct answers B) Safeguards created by peers
who performed the audit in the preceding year.
Which of the following is required by International Standards on Auditing?
A) Require management to sign the report in addition to the auditor.
B) Require the identification of location of the auditor's office that audited the client.
C) Require an opinion on internal control.
D) Require the report to be signed in the name of the audit partner. correct answers B) Require
the identification of location of the auditor's office that audited the client.
Which of the following is least likely to be directly examined in an inspection performed by the
PCAOB?
A) Audit engagements.
B) Review engagements.
C) Compilation engagements.
D) CPA firm quality control system. correct answers C) Compilation engagements.
,Which of the following can cause a CPA to receive an automatic suspension from the AICPA?
I. The CPA's CPA certificate is revoked by the relevant state board of accountancy.
II. The CPA is convicted of a crime punishable by more than one year in jail.
III. The CPA intentionally did not file his personal tax return as required by federal law.
A) I only.
B) II only.
C) I and II only.
D) I, II, and III. correct answers D) I, II, and III.
Under the ethical standards of the profession, which of the following investments by a CPA in a
corporate client is an indirect financial interest?
A) An investment held in a retirement plan.
B) An investment held in a blind trust.
C) An investment held through a regulated mutual fund.
D) An investment held through participation in an investment club. correct answers C) An
investment held through a regulated mutual fund.
Each of the following is a required attribute of an issuer's audit committee financial expert,
except
A) The ability to assess the application of accounting principles in connection with estimates,
accruals, and reserves.
B) Significant audit experience as a certified public accountant.
, C) An understanding of internal controls related to financial reporting.
D) An understanding of generally accepted accounting principles. correct answers B) Significant
audit experience as a certified public accountant.
Each of the following broker-dealer relationships impairs auditor independence with respect to a
broker-dealer issuer audit client, except:
A) The auditor has a brokerage account that holds both U.S. securities and assets other than cash
or securities.
B) The auditor has a brokerage account that holds U.S. securities in excess of Securities Investor
Protection Corporation coverage limits.
C) The auditor has a brokerage account that includes assets other than cash or securities.
D) The auditor has a cash balance in a brokerage account that is fully covered by the Securities
Investor Protection Corporation. correct answers D) The auditor has a cash balance in a
brokerage account that is fully covered by the Securities Investor Protection Corporation.
When a threat to independence arises that is not specifically considered in the Code of
Professional Conduct an auditor should consider
A) Alternative threats to a lack of independence.
B) Available safeguards to independence.
C) Global independence rules.
D) Required lack of independence approaches. correct answers B) Available safeguards to
independence.
Which of the following is not a section title ordinarily included in an international audit report?
A) Auditor's responsibility.
B) Board of directors overall responsibility.
C) Management's responsibility for the financial statements.
solutions 100%.
Under the ethical standards of the profession, which of the following positions would be
considered a position of significant influence in an audit client?
A) A marketing position related to the client's primary products.
B) A policy-making position in the client's finance division.
C) A staff position in the client's research and development division.
D) A senior position in the client's human resources division. correct answers B) A policy-
making position in the client's finance division.
An integrated audit performed under the Sarbanes-Oxley Act includes auditor opinion on
A) Financial Statements
B) Internal Control
C) Both
D) Neither correct answers C) Both
ABC Company is audited by the Albuquerque office of Whitt CPAs. Which of the following
individuals would be least likely to be considered a "covered member" by the AICPA Code of
Professional Conduct independence standard?
A) Staff assistant on the audit.
B) An audit partner in the Silver Springs office who performs no attest services for ABC
Company.
C) A tax partner in Albuquerque who performs no attest services for ABC Company or for any
other firm clients.
,D) The partner in charge of Whitt CPAs (she does not work on the ABC Company audit). correct
answers B) An audit partner in the Silver Springs office who performs no attest services for ABC
Company.
Which of the following is not a broad category of safeguards that mitigate or eliminate threats to
independence?
A) Safeguards created by the profession, legislation, or regulation.
B) Safeguards created by peers who performed the audit in the preceding year.
C) Safeguards implemented by the firm, including policies and procedures to implement
professional and regulatory requirements.
D) Safeguards implemented by the attest client. correct answers B) Safeguards created by peers
who performed the audit in the preceding year.
Which of the following is required by International Standards on Auditing?
A) Require management to sign the report in addition to the auditor.
B) Require the identification of location of the auditor's office that audited the client.
C) Require an opinion on internal control.
D) Require the report to be signed in the name of the audit partner. correct answers B) Require
the identification of location of the auditor's office that audited the client.
Which of the following is least likely to be directly examined in an inspection performed by the
PCAOB?
A) Audit engagements.
B) Review engagements.
C) Compilation engagements.
D) CPA firm quality control system. correct answers C) Compilation engagements.
,Which of the following can cause a CPA to receive an automatic suspension from the AICPA?
I. The CPA's CPA certificate is revoked by the relevant state board of accountancy.
II. The CPA is convicted of a crime punishable by more than one year in jail.
III. The CPA intentionally did not file his personal tax return as required by federal law.
A) I only.
B) II only.
C) I and II only.
D) I, II, and III. correct answers D) I, II, and III.
Under the ethical standards of the profession, which of the following investments by a CPA in a
corporate client is an indirect financial interest?
A) An investment held in a retirement plan.
B) An investment held in a blind trust.
C) An investment held through a regulated mutual fund.
D) An investment held through participation in an investment club. correct answers C) An
investment held through a regulated mutual fund.
Each of the following is a required attribute of an issuer's audit committee financial expert,
except
A) The ability to assess the application of accounting principles in connection with estimates,
accruals, and reserves.
B) Significant audit experience as a certified public accountant.
, C) An understanding of internal controls related to financial reporting.
D) An understanding of generally accepted accounting principles. correct answers B) Significant
audit experience as a certified public accountant.
Each of the following broker-dealer relationships impairs auditor independence with respect to a
broker-dealer issuer audit client, except:
A) The auditor has a brokerage account that holds both U.S. securities and assets other than cash
or securities.
B) The auditor has a brokerage account that holds U.S. securities in excess of Securities Investor
Protection Corporation coverage limits.
C) The auditor has a brokerage account that includes assets other than cash or securities.
D) The auditor has a cash balance in a brokerage account that is fully covered by the Securities
Investor Protection Corporation. correct answers D) The auditor has a cash balance in a
brokerage account that is fully covered by the Securities Investor Protection Corporation.
When a threat to independence arises that is not specifically considered in the Code of
Professional Conduct an auditor should consider
A) Alternative threats to a lack of independence.
B) Available safeguards to independence.
C) Global independence rules.
D) Required lack of independence approaches. correct answers B) Available safeguards to
independence.
Which of the following is not a section title ordinarily included in an international audit report?
A) Auditor's responsibility.
B) Board of directors overall responsibility.
C) Management's responsibility for the financial statements.
