TEST BANK FOR AUDITING & ASSURANCE SERVICES: A
n n n n n n n
SYSTEMATIC APPROACH 12TH EDITION BY
n n n n n
WILLIAM MESSIER, STEVEN GLOVER
n n n n
Chapter 01n Answers Included ✅
n n
12e
n
1) Why ndo nauditors noften nuse na nsampling napproach nto nevidence ngathering?
A) Auditors nare nexperts nand ndo nnot nneed nto nlook nat nmuch nto nknow
nwhether nthe nfinancial nstatements nare ncorrect nor nnot.
B) Auditors nmust nbalance nthe ncost nof nthe naudit nwith nthe nneed nfor nprecision
nand nfor nsome ntypes nof nevidence, ncomputer ndata nanalytic napproaches ncan’t nbe nused.
C) Auditors nmust nlimit ntheir nexposure nto ntheir nauditee nto nmaintain nindependence.
D) The nauditor's nrelationship nwith nthe nauditee nis ngenerally nadversarial, nso nthe
nauditor nwill nnot nhave naccess nto nall nof nthe nfinancial ninformation nof nthe ncompany.
2) Which nof nthe nfollowing nstatements nbest ndescribes na nrelationship nbetween
nsample nsize nand n other nelements nof nauditing?
A) If nmateriality nincreases, nso nwill nthe nsample nsize.
B) If nthe ndesired nlevel nof nassurance nincreases, nsample nsizes ncan nbe nsmaller.
C) If nmateriality ndecreases, nsample nsize nwill nneed nto nincrease.
D) There nis nno nrelationship nbetween nsample nsize nand nmateriality nor nthe
ndesired nlevel nof nassurance.
3) Which nof nthe nfollowing nstatements nabout nthe nstudy nof nauditing nis nNOT ntrue?
A) The nstudy nof nauditing ncan nbe nvaluable nto nfuture naccountants nand
nbusiness ndecision nmakers nwhether nor nnot nthey nplan nto nbecome nauditors.
B) The nstudy nof nauditing nfocuses non nlearning nthe nanalytical nand nlogical
nskills nnecessary nto nevaluate nthe nrelevance nand nreliability nof ninformation.
C) The nstudy nof nauditing nfocuses non nlearning nthe nrules, ntechniques, nand
ncomputations nrequired nto nanalyze nfinancial nstatements nfor nmaking ninvestment
nrecommendations.
D) The nstudy nof nauditing nbegins nwith nthe nunderstanding nof na ncoherent
nlogical nframework nand ntechniques nuseful nfor ngathering nand nanalyzing nevidence
1
,about nothers’ nassertions.
n
4) The nbasic ndefinition nof nauditing nessentially nindicates nthat, noverall, nauditing nis na nprocess
nto:
2
, A) detect nfraud.
B) examine nindividual ntransactions nso nthat nthe nauditor nmay ncertify nas nto ntheir
nvalidity.
C) objectively nobtain nand nevaluate nevidence nregarding nassertions nmade nby
nanother nparty.
D) assure nthe nconsistent napplication nof ncorrect naccounting nprocedures.
5) Assurance nservices nmay nimprove nall nof nthe nfollowing nexcept:
A) relevance.
B) credibility.
C) periodicity.
D) reliability.
6) Evidence nis nreliable nif nit:
A) signals nthe ntrue nstate nof na nmanagement nassertion.
B) applies nto nthe nperiod nbeing naudited.
C) relates nto nthe naudit nassertion nbeing ntested.
D) is nsufficient nto njustify na nconclusion.
7) Which nof nthe nfollowing nbest ndescribes nthe nconcept nof naudit nrisk?
A) The nrisk nof nthe nauditor nbeing nsued nbecause nof nassociation nwith nan nauditee.
B) The nrisk nthat nthe nauditor nwill nprovide nan ninappropriate nopinion
non nfinancial nstatements nthat nare, nin nfact, nmaterially nmisstated.
C) The noverall nrisk nthat na nmaterial nmisstatement nexists nin nthe nfinancial
nstatements.
D) The nrisk nthat nauditors nuse naudit nprocedures nthat nare ninappropriate.
3
, 8) An nauditor nwho naccepts nan naudit nengagement nand ndoes nnot npossess
nexpertise nwith nrespect nto nthe nbusiness nentity’s nindustry nat nthat npoint, nshould:
4
n n n n n n n
SYSTEMATIC APPROACH 12TH EDITION BY
n n n n n
WILLIAM MESSIER, STEVEN GLOVER
n n n n
Chapter 01n Answers Included ✅
n n
12e
n
1) Why ndo nauditors noften nuse na nsampling napproach nto nevidence ngathering?
A) Auditors nare nexperts nand ndo nnot nneed nto nlook nat nmuch nto nknow
nwhether nthe nfinancial nstatements nare ncorrect nor nnot.
B) Auditors nmust nbalance nthe ncost nof nthe naudit nwith nthe nneed nfor nprecision
nand nfor nsome ntypes nof nevidence, ncomputer ndata nanalytic napproaches ncan’t nbe nused.
C) Auditors nmust nlimit ntheir nexposure nto ntheir nauditee nto nmaintain nindependence.
D) The nauditor's nrelationship nwith nthe nauditee nis ngenerally nadversarial, nso nthe
nauditor nwill nnot nhave naccess nto nall nof nthe nfinancial ninformation nof nthe ncompany.
2) Which nof nthe nfollowing nstatements nbest ndescribes na nrelationship nbetween
nsample nsize nand n other nelements nof nauditing?
A) If nmateriality nincreases, nso nwill nthe nsample nsize.
B) If nthe ndesired nlevel nof nassurance nincreases, nsample nsizes ncan nbe nsmaller.
C) If nmateriality ndecreases, nsample nsize nwill nneed nto nincrease.
D) There nis nno nrelationship nbetween nsample nsize nand nmateriality nor nthe
ndesired nlevel nof nassurance.
3) Which nof nthe nfollowing nstatements nabout nthe nstudy nof nauditing nis nNOT ntrue?
A) The nstudy nof nauditing ncan nbe nvaluable nto nfuture naccountants nand
nbusiness ndecision nmakers nwhether nor nnot nthey nplan nto nbecome nauditors.
B) The nstudy nof nauditing nfocuses non nlearning nthe nanalytical nand nlogical
nskills nnecessary nto nevaluate nthe nrelevance nand nreliability nof ninformation.
C) The nstudy nof nauditing nfocuses non nlearning nthe nrules, ntechniques, nand
ncomputations nrequired nto nanalyze nfinancial nstatements nfor nmaking ninvestment
nrecommendations.
D) The nstudy nof nauditing nbegins nwith nthe nunderstanding nof na ncoherent
nlogical nframework nand ntechniques nuseful nfor ngathering nand nanalyzing nevidence
1
,about nothers’ nassertions.
n
4) The nbasic ndefinition nof nauditing nessentially nindicates nthat, noverall, nauditing nis na nprocess
nto:
2
, A) detect nfraud.
B) examine nindividual ntransactions nso nthat nthe nauditor nmay ncertify nas nto ntheir
nvalidity.
C) objectively nobtain nand nevaluate nevidence nregarding nassertions nmade nby
nanother nparty.
D) assure nthe nconsistent napplication nof ncorrect naccounting nprocedures.
5) Assurance nservices nmay nimprove nall nof nthe nfollowing nexcept:
A) relevance.
B) credibility.
C) periodicity.
D) reliability.
6) Evidence nis nreliable nif nit:
A) signals nthe ntrue nstate nof na nmanagement nassertion.
B) applies nto nthe nperiod nbeing naudited.
C) relates nto nthe naudit nassertion nbeing ntested.
D) is nsufficient nto njustify na nconclusion.
7) Which nof nthe nfollowing nbest ndescribes nthe nconcept nof naudit nrisk?
A) The nrisk nof nthe nauditor nbeing nsued nbecause nof nassociation nwith nan nauditee.
B) The nrisk nthat nthe nauditor nwill nprovide nan ninappropriate nopinion
non nfinancial nstatements nthat nare, nin nfact, nmaterially nmisstated.
C) The noverall nrisk nthat na nmaterial nmisstatement nexists nin nthe nfinancial
nstatements.
D) The nrisk nthat nauditors nuse naudit nprocedures nthat nare ninappropriate.
3
, 8) An nauditor nwho naccepts nan naudit nengagement nand ndoes nnot npossess
nexpertise nwith nrespect nto nthe nbusiness nentity’s nindustry nat nthat npoint, nshould:
4
