1|Page
WGU D251 - Advanced Auditing Final Exam | {LATEST
2026/ 2027 UPDATE} COMPLETE ACTUAL AND
AUTHENTIC EXAM | BRAND NEW!
Which phrase or term regarding materiality is used by the Supreme
Court of the United States and is not found in FASB Concepts
Statements No. 2
in light of surrounding circumstances
significantly altered the total mix of information available
magnitude of an omission or misstatement
probable that the judgment of a reasonable person
......ANSWER......significantly altered the total mix of information
available
Which materiality does an auditor use when determining whether the
financial statements overall are materially correct?
performance materiality
Specific materiality
planning materiality
Posting materiality ......ANSWER......performance materiality
What describes the misstatements identified throughout the audit
that will be considered at the end of the audit in determining whether
the financial
pg. 1
,2|Page
statements overall are materially correct?
Posting materiality
Tolerable error
Overall materiality
Performance materiality ......ANSWER......Posting materiality
When materiality judgments change during the audit opinion
formulation process, what happens to previous audit decisions that
were based on
evidence obtained using the initial materiality setting?
The auditor repeats all audit procedures performed prior to the
change in the materiality judgments.
The auditor reassesses those previous audit decisions.
The auditor takes no action.
The auditor modifies the audit opinion to note the change in the
materiality judgments. ......ANSWER......The auditor reassesses those
previous audit decisions.
Which factor would result in control risk being assessed at a higher
level?
Controls are well designed.
Accounting staff are well trained and educated.
pg. 2
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There is a lack of supervision of accounting personnel.
The control environment is operating effectively.
......ANSWER......There is a lack of supervision of accounting personnel.
Which technique is used to analyze year-to-year comparisons of
account balances?
Trend analysis
Ratio analysis
Variance analysis
Reasonableness test ......ANSWER......Trend analysis
Which term describes the numerical depiction of the relationship
between control risk, inherent risk, and detection risk?
Risk assessment process
Risk of material misstatement
Data modeling
Audit risk model ......ANSWER......Audit risk model
Which risk factor suggests a heightened level of risk of material
misstatement?
Having key personnel of a company depart
Having a stable product
Declining a merger with another company
pg. 3
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Having few immaterial related-party transactions
......ANSWER......Having key personnel of a company depart
What is the relationship between the risk of material misstatement
and audit risk?
Correlational
Direct
None
Inverse ......ANSWER......Inverse
What is the typical range for the setting of audit risk?
0% to 5%
0% to 10%
1% to 10%
1% to 5% ......ANSWER......1% to 5%
Which risk result would likely be achieved from using a 1% level of
detection risk?
A high detection risk and a low audit risk
A low detection risk and a low audit risk
A low detection risk and a high audit risk
A high detection risk and a high audit risk ......ANSWER......A low
detection risk and a low audit risk
pg. 4
WGU D251 - Advanced Auditing Final Exam | {LATEST
2026/ 2027 UPDATE} COMPLETE ACTUAL AND
AUTHENTIC EXAM | BRAND NEW!
Which phrase or term regarding materiality is used by the Supreme
Court of the United States and is not found in FASB Concepts
Statements No. 2
in light of surrounding circumstances
significantly altered the total mix of information available
magnitude of an omission or misstatement
probable that the judgment of a reasonable person
......ANSWER......significantly altered the total mix of information
available
Which materiality does an auditor use when determining whether the
financial statements overall are materially correct?
performance materiality
Specific materiality
planning materiality
Posting materiality ......ANSWER......performance materiality
What describes the misstatements identified throughout the audit
that will be considered at the end of the audit in determining whether
the financial
pg. 1
,2|Page
statements overall are materially correct?
Posting materiality
Tolerable error
Overall materiality
Performance materiality ......ANSWER......Posting materiality
When materiality judgments change during the audit opinion
formulation process, what happens to previous audit decisions that
were based on
evidence obtained using the initial materiality setting?
The auditor repeats all audit procedures performed prior to the
change in the materiality judgments.
The auditor reassesses those previous audit decisions.
The auditor takes no action.
The auditor modifies the audit opinion to note the change in the
materiality judgments. ......ANSWER......The auditor reassesses those
previous audit decisions.
Which factor would result in control risk being assessed at a higher
level?
Controls are well designed.
Accounting staff are well trained and educated.
pg. 2
,3|Page
There is a lack of supervision of accounting personnel.
The control environment is operating effectively.
......ANSWER......There is a lack of supervision of accounting personnel.
Which technique is used to analyze year-to-year comparisons of
account balances?
Trend analysis
Ratio analysis
Variance analysis
Reasonableness test ......ANSWER......Trend analysis
Which term describes the numerical depiction of the relationship
between control risk, inherent risk, and detection risk?
Risk assessment process
Risk of material misstatement
Data modeling
Audit risk model ......ANSWER......Audit risk model
Which risk factor suggests a heightened level of risk of material
misstatement?
Having key personnel of a company depart
Having a stable product
Declining a merger with another company
pg. 3
, 4|Page
Having few immaterial related-party transactions
......ANSWER......Having key personnel of a company depart
What is the relationship between the risk of material misstatement
and audit risk?
Correlational
Direct
None
Inverse ......ANSWER......Inverse
What is the typical range for the setting of audit risk?
0% to 5%
0% to 10%
1% to 10%
1% to 5% ......ANSWER......1% to 5%
Which risk result would likely be achieved from using a 1% level of
detection risk?
A high detection risk and a low audit risk
A low detection risk and a low audit risk
A low detection risk and a high audit risk
A high detection risk and a high audit risk ......ANSWER......A low
detection risk and a low audit risk
pg. 4
