ACCT 4240 Audit Exam 1 Questions and Answers Already Passed

ACCT 4240 Audit Exam 1 Questions and Answers Already Passed Responsibility for setting all audit standards to be followed on audits of public companies rests with the: - Answers PCAOB Services that public accounting firms are prohibited from providing to audit clients under SOX include: - Answers -legal and expert services -internal audit outsourcing -investment services -actuarial services Having an attitude that "includes a questioning mind and a critical assessment of evidence" is the definition of: - Answers professional skepticism For assurance services, improving the quality or _______________ of information refers not to the information itself, but to how the information is used in decision making. - Answers context For independent auditors, established criteria essential for effective communication may be found in: - Answers -GAAP -IFRS Obtaining evidence about estimated liabilities relates to the ___________ assertion. - Answers rights and obligations Designations for accountants within public accounting other than a CPA include: - Answers -certified fraud examiner -certified forensic accountant -certified internal auditor T/F: Providing assurance is a form of attestation. - Answers False- attestation is a form of providing assurance The probability that data circulated by a company will be false or misleading is_____________________. - Answers information risk Operational audits are: - Answers -a type of assurance service provided by public accounting firms -performed by both internal and external auditors -integral to internal auditing When audit quality is compromised: - Answers investor and creditor confidence is shaken. Internal auditors: (choose all that apply) -examine evidence and issue an option on fairness of fs -review the effectiveness of achieving results compared to established objectives -review internal control systems to ensure compliance with company policies -perform audits of financial reports for limited external distribution - Answers -review the effectiveness of achieving results compared to established objectives -review internal control systems to ensure compliance with company policies -perform audits of financial reports for limited external distribution When a CPA performs a ___________, limited-evidence gathering work is done, but the scope is narrower than in an audit. - Answers review The assertions about the actuality of each balance sheet and income statement balance is ________________, while _____________ asserts that each event and transaction actually happened. - Answers existence; occurrence Helping an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk mgmt, control and governance processes is the objective of______________ auditing. - Answers internal The US Government Accountability Office (GAO) ____________________. (choose all that apply) -provides a compliance audit function with respect to laws and regulations -provides a wide range of performance audits -performs attestation engagements but not financial audits -emphasizes the accountability of public officials in regards to public funds and other resources - Answers -provides a compliance audit function with respect to laws and regulations -provides a wide range of performance audits -emphasizes the accountability of public officials in regards to public funds and other resources T/F: When considering established criteria for effective communication, external auditors rely on financial and managerial models of efficiency and effectiveness. - Answers False The study of business activities for the purpose of making recommendations about the efficiency and effective use of resources, effective achievement of business objectives and compliance with company policies is __________ auditing. - Answers operational Services that public accounting firms are prohibited from providing to audit clients under SOX include: (choose all that apply) -tax return preparation advice