,Auditing B& BAssurance BServices, B7e B(Louwers)
BChapter B1 B Auditing Band BAssurance BServices
1) The Baudit Bobjective Bthat Ball Btransactions Band Baccounts Bthat Bshould Bbe Bpresented Bin Bthe
Bfinancial Bstatements Bare Bin Bfact Bincluded Bis Brelated Bto Bwhich Bof Bthe BPCAOB Bassertions?
A) Existence.
B) Rights Band Bobligations.
C) Completeness.
D) Valuation.
BAnswer: B C
BDifficulty: B1
BEasy
Topic: B Management's BFinancial BStatement BAssertions
Learning BObjective: B 01-03 BDescribe Band Bdefine Bthe Bassertions Bthat Bmanagement Bmakes Babout
Bthe Brecognition, Bmeasurement, Bpresentation, Band Bdisclosure Bof Bthe Bfinancial Bstatements Band
Bexplain Bwhy Bauditors Buse Bthem Bas Bthe Bfocal Bpoint Bof Bthe Baudit.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
2) Cutoff Btests Bdesigned Bto Bdetect Bpurchases Bmade Bbefore Bthe Bend Bof Bthe Byear Bthat Bhave
Bbeen Brecorded Bin Bthe Bsubsequent Byear Bprovide Bassurance Babout Bmanagement's Bassertion
Bof:
A) presentation Band Bdisclosure.
B) completeness.
C) rights Band Bobligations.
D) existence.
BAnswer: B B
BDifficulty: B2
BMedium
Topic: B Management's BFinancial BStatement BAssertions
Learning BObjective: B 01-03 BDescribe Band Bdefine Bthe Bassertions Bthat Bmanagement Bmakes Babout
Bthe Brecognition, Bmeasurement, Bpresentation, Band Bdisclosure Bof Bthe Bfinancial Bstatements Band
Bexplain Bwhy Bauditors Buse Bthem Bas Bthe Bfocal Bpoint Bof Bthe Baudit.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
1
Copyright B© B2018 BMcGraw-
Hill
,3) During Ban Baudit Bof Ban Bentity's Bstockholders' Bequity Baccounts, Bthe Bauditor Bdetermines
Bwhether Bthere Bare Brestrictions Bon Bretained Bearnings Bresulting Bfrom Bloans, Bagreements, Bor
Bstate Blaw. BThis Baudit Bprocedure Bmost Blikely Bis Bintended Bto Bverify Bmanagement's Bassertion
Bof:
A) existence Bor Boccurrence.
B) completeness.
C) valuation Bor Ballocation.
D) presentation Band
Bdisclosure. BAnswer: B D
Difficulty: B2 BMedium
Topic: B Management's BFinancial BStatement BAssertions
Learning BObjective: B 01-03 BDescribe Band Bdefine Bthe Bassertions Bthat Bmanagement Bmakes Babout
Bthe Brecognition, Bmeasurement, Bpresentation, Band Bdisclosure Bof Bthe Bfinancial Bstatements Band
Bexplain Bwhy Bauditors Buse Bthem Bas Bthe Bfocal Bpoint Bof Bthe Baudit.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
4) The Bconfirmation Bof Ban Baccount Bpayable Bbalance Bselected Bfrom Bthe Bgeneral Bledger
Bprovides Bprimary Bevidence Bregarding Bwhich Bmanagement Bassertion?
A) Completeness.
B) Valuation.
C) Allocation.
D) Existence.
BAnswer: B D
BDifficulty: B2
BMedium
Topic: B Management's BFinancial BStatement BAssertions
Learning BObjective: B 01-03 BDescribe Band Bdefine Bthe Bassertions Bthat Bmanagement Bmakes Babout
Bthe Brecognition, Bmeasurement, Bpresentation, Band Bdisclosure Bof Bthe Bfinancial Bstatements Band
Bexplain Bwhy Bauditors Buse Bthem Bas Bthe Bfocal Bpoint Bof Bthe Baudit.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
5) What Btype Bof Bevidence Bwould Bprovide Bthe Bhighest Blevel Bof Bassurance Bin Ban
Battestation Bengagement?
A) Evidence Bsecured Bsolely Bfrom Bwithin Bthe Bentity.
B) Evidence Bobtained Bfrom Bindependent Bsources.
C) Evidence Bobtained Bindirectly.
D) Evidence Bobtained Bfrom Bmultiple Binternal
Binquiries. BAnswer: B B
Difficulty: B3 BHard
Topic: B Auditing, BAttestation, Band BAssurance BServices
Learning BObjective: B 01-02 BDefine Band Bcontrast Bfinancial Bstatement Bauditing, Battestation, Band
2
Copyright B© B2018 BMcGraw-
Hill
, Bassurance Bservices.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
3
Copyright B© B2018 BMcGraw-
Hill
BChapter B1 B Auditing Band BAssurance BServices
1) The Baudit Bobjective Bthat Ball Btransactions Band Baccounts Bthat Bshould Bbe Bpresented Bin Bthe
Bfinancial Bstatements Bare Bin Bfact Bincluded Bis Brelated Bto Bwhich Bof Bthe BPCAOB Bassertions?
A) Existence.
B) Rights Band Bobligations.
C) Completeness.
D) Valuation.
BAnswer: B C
BDifficulty: B1
BEasy
Topic: B Management's BFinancial BStatement BAssertions
Learning BObjective: B 01-03 BDescribe Band Bdefine Bthe Bassertions Bthat Bmanagement Bmakes Babout
Bthe Brecognition, Bmeasurement, Bpresentation, Band Bdisclosure Bof Bthe Bfinancial Bstatements Band
Bexplain Bwhy Bauditors Buse Bthem Bas Bthe Bfocal Bpoint Bof Bthe Baudit.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
2) Cutoff Btests Bdesigned Bto Bdetect Bpurchases Bmade Bbefore Bthe Bend Bof Bthe Byear Bthat Bhave
Bbeen Brecorded Bin Bthe Bsubsequent Byear Bprovide Bassurance Babout Bmanagement's Bassertion
Bof:
A) presentation Band Bdisclosure.
B) completeness.
C) rights Band Bobligations.
D) existence.
BAnswer: B B
BDifficulty: B2
BMedium
Topic: B Management's BFinancial BStatement BAssertions
Learning BObjective: B 01-03 BDescribe Band Bdefine Bthe Bassertions Bthat Bmanagement Bmakes Babout
Bthe Brecognition, Bmeasurement, Bpresentation, Band Bdisclosure Bof Bthe Bfinancial Bstatements Band
Bexplain Bwhy Bauditors Buse Bthem Bas Bthe Bfocal Bpoint Bof Bthe Baudit.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
1
Copyright B© B2018 BMcGraw-
Hill
,3) During Ban Baudit Bof Ban Bentity's Bstockholders' Bequity Baccounts, Bthe Bauditor Bdetermines
Bwhether Bthere Bare Brestrictions Bon Bretained Bearnings Bresulting Bfrom Bloans, Bagreements, Bor
Bstate Blaw. BThis Baudit Bprocedure Bmost Blikely Bis Bintended Bto Bverify Bmanagement's Bassertion
Bof:
A) existence Bor Boccurrence.
B) completeness.
C) valuation Bor Ballocation.
D) presentation Band
Bdisclosure. BAnswer: B D
Difficulty: B2 BMedium
Topic: B Management's BFinancial BStatement BAssertions
Learning BObjective: B 01-03 BDescribe Band Bdefine Bthe Bassertions Bthat Bmanagement Bmakes Babout
Bthe Brecognition, Bmeasurement, Bpresentation, Band Bdisclosure Bof Bthe Bfinancial Bstatements Band
Bexplain Bwhy Bauditors Buse Bthem Bas Bthe Bfocal Bpoint Bof Bthe Baudit.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
4) The Bconfirmation Bof Ban Baccount Bpayable Bbalance Bselected Bfrom Bthe Bgeneral Bledger
Bprovides Bprimary Bevidence Bregarding Bwhich Bmanagement Bassertion?
A) Completeness.
B) Valuation.
C) Allocation.
D) Existence.
BAnswer: B D
BDifficulty: B2
BMedium
Topic: B Management's BFinancial BStatement BAssertions
Learning BObjective: B 01-03 BDescribe Band Bdefine Bthe Bassertions Bthat Bmanagement Bmakes Babout
Bthe Brecognition, Bmeasurement, Bpresentation, Band Bdisclosure Bof Bthe Bfinancial Bstatements Band
Bexplain Bwhy Bauditors Buse Bthem Bas Bthe Bfocal Bpoint Bof Bthe Baudit.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
5) What Btype Bof Bevidence Bwould Bprovide Bthe Bhighest Blevel Bof Bassurance Bin Ban
Battestation Bengagement?
A) Evidence Bsecured Bsolely Bfrom Bwithin Bthe Bentity.
B) Evidence Bobtained Bfrom Bindependent Bsources.
C) Evidence Bobtained Bindirectly.
D) Evidence Bobtained Bfrom Bmultiple Binternal
Binquiries. BAnswer: B B
Difficulty: B3 BHard
Topic: B Auditing, BAttestation, Band BAssurance BServices
Learning BObjective: B 01-02 BDefine Band Bcontrast Bfinancial Bstatement Bauditing, Battestation, Band
2
Copyright B© B2018 BMcGraw-
Hill
, Bassurance Bservices.
Blooms: B Remember
AACSB: B Analytical BThinking
BAccessibility: B Keyboard
BNavigation
3
Copyright B© B2018 BMcGraw-
Hill
