TEST BANK
Auditing: A Risk Based-Approach to Conducting a Quality Audit
Karla Johnstone-Zehms
10th Edition
PR
O
FD
O
C
,Table of Contents
1. Auditing: Integral to the Economy
2. The Risk of Fraud and Mechanisms to Address Fraud: Regulation, Corporate Governance, and Audit
Quality
3. Internal Control over Financial Reporting: Management’s Responsibilities and Importance to the
External Auditors
4. Professional Liability and the Need for Quality Auditor Judgments and Ethical Decisions
5. Professional Auditing Standards and the Audit Opinion Formulation Process
6. A Framework for Audit Evidence
7. Planning the Audit: Identifying and Responding to the Risks of Material Misstatement
8. Specialized Audit Tools: Sampling and Generalized Audit Software
PR
9. Auditing the Revenue Cycle
10. Auditing Cash and Marketable Securities
11. Auditing Inventory, Goods and Services, and Accounts Payable: The Acquisition and Payment Cycle
O
12. Auditing Long-Lived Assets: Acquisition, Use, Impairment, and Disposal
13. Auditing Debt Obligations and Stockholders’ Equity Transactions
FD
14. Activities Required in Completing a Quality Audit
15. Audit Reports on Financial Statements
16. Advanced Topics Concerning Complex Auditing Judgments
O
17. Other Services Provided by Audit Firms
C
,Chapter 1 - Auditing: Integral to the Economy
1. The need for assurance services arises because the interests of the users of information may be different from
that of the interests of those responsible for providing information.
a. True
b. False
ANSWER: True
POINTS: 1
NATIONAL STANDARDS: United States - BUSPORG: Analytic
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
TOPICS: Demand for Assurances
2. A financial statement audit is a systematic process of objectively obtaining and evaluating evidence.
a. True
b. False
PR
ANSWER: True
POINTS: 1
NATIONAL STANDARDS: United States - BUSPORG: Analytic
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
TOPICS: Auditing Defined
O
3. Auditors should conduct their work with an attitude of professional skepticism.
a. True
FD
b. False
ANSWER: True
POINTS: 1
NATIONAL STANDARDS: United States - BUSPORG: Analytic
O
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
TOPICS: Auditing Defined
C
4. A bank using Milton Company's financial statements to determine the creditworthiness of a potential loan to
Milton is a good example of the need for unbiased reporting.
a. True
b. False
ANSWER: True
POINTS: 1
NATIONAL STANDARDS: United States - BUSPORG: Analytic
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
TOPICS: Auditing Defined
5. An integrated audit requires the auditor to assess the effectiveness of internal controls.
a. True
b. False
, ANSWER: True
PR
O
FD
O
C
Auditing: A Risk Based-Approach to Conducting a Quality Audit
Karla Johnstone-Zehms
10th Edition
PR
O
FD
O
C
,Table of Contents
1. Auditing: Integral to the Economy
2. The Risk of Fraud and Mechanisms to Address Fraud: Regulation, Corporate Governance, and Audit
Quality
3. Internal Control over Financial Reporting: Management’s Responsibilities and Importance to the
External Auditors
4. Professional Liability and the Need for Quality Auditor Judgments and Ethical Decisions
5. Professional Auditing Standards and the Audit Opinion Formulation Process
6. A Framework for Audit Evidence
7. Planning the Audit: Identifying and Responding to the Risks of Material Misstatement
8. Specialized Audit Tools: Sampling and Generalized Audit Software
PR
9. Auditing the Revenue Cycle
10. Auditing Cash and Marketable Securities
11. Auditing Inventory, Goods and Services, and Accounts Payable: The Acquisition and Payment Cycle
O
12. Auditing Long-Lived Assets: Acquisition, Use, Impairment, and Disposal
13. Auditing Debt Obligations and Stockholders’ Equity Transactions
FD
14. Activities Required in Completing a Quality Audit
15. Audit Reports on Financial Statements
16. Advanced Topics Concerning Complex Auditing Judgments
O
17. Other Services Provided by Audit Firms
C
,Chapter 1 - Auditing: Integral to the Economy
1. The need for assurance services arises because the interests of the users of information may be different from
that of the interests of those responsible for providing information.
a. True
b. False
ANSWER: True
POINTS: 1
NATIONAL STANDARDS: United States - BUSPORG: Analytic
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
TOPICS: Demand for Assurances
2. A financial statement audit is a systematic process of objectively obtaining and evaluating evidence.
a. True
b. False
PR
ANSWER: True
POINTS: 1
NATIONAL STANDARDS: United States - BUSPORG: Analytic
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
TOPICS: Auditing Defined
O
3. Auditors should conduct their work with an attitude of professional skepticism.
a. True
FD
b. False
ANSWER: True
POINTS: 1
NATIONAL STANDARDS: United States - BUSPORG: Analytic
O
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
TOPICS: Auditing Defined
C
4. A bank using Milton Company's financial statements to determine the creditworthiness of a potential loan to
Milton is a good example of the need for unbiased reporting.
a. True
b. False
ANSWER: True
POINTS: 1
NATIONAL STANDARDS: United States - BUSPORG: Analytic
STATE STANDARDS: United States - AK - AICPA BB-Critical thinking
TOPICS: Auditing Defined
5. An integrated audit requires the auditor to assess the effectiveness of internal controls.
a. True
b. False
, ANSWER: True
PR
O
FD
O
C
