AUD REAL EXAM QUESTIONS AND CORRECT
DETAILED ANSWERS 2025 LATEST VERSION//
ALREADY GRADED A+
What are some examples of scope limitations? - (answer)- Time constraints
- Inability to obtain sufficient appropriate evidence (if cannot perform alternative
procedures, auditor would then express qualified or disclaimer)
- Refusal of mgmt. to provide written representation and/or to acknowledge its
responsibility for the fair presentation of the financial statements in conformity
with GAAP
- Refusal of client's attorney to respond to inquiry
If management imposes a limitation and will not remove it, what should the
auditor do? - (answer)The auditor should communicate with those charged with
governance and determine whether its possible to perform alternative
procedures.
** if the auditor is unable to obtain sufficient appropriate evidence due to mgmt
imposed limitation and auditor concludes the possible effects of misstatements
can be material and pervasive, then the auditor should disclaim an opinion or
withdraw.
In unqualified opinion for issuer, where do you refer to the standards? -
(answer)PCAOB - basis for opinion
GAAP - opinion on FS section
, What is a CAM (critical audit matter)? - (answer)A matter that was communicated
or required to be communicated to the audit committee and that:
01. relates to accounts or disclosures that are material to FS; and
02. involved especially challenging, subjective, or complex auditor judgement
How do you document a CAM? - (answer)Make sure to IDENTIFY it on a PAD of
paper.
- identification of CAM
- description of the principal considerations that led the auditor to determine the
matter was a CAM
- description of how the CAM was addressed in the audit; and
- reference to the relevant FS accounts or disclosures
For an unmodified report for nonissuers, when do you refer to appropriate
standards? - (answer)GAAS - basis for opinion and auditor's responsibilities
paragraphs
GAAP - management's responsibility and opinion paragraphs
Format of Unmodified Opinion (OBRA) - NONISSUER - (answer)- Opinion
- Basis for Opinion
- Responsibilities of Management for the FS
- Auditor's Responsibilities for the Audit of the FS
DETAILED ANSWERS 2025 LATEST VERSION//
ALREADY GRADED A+
What are some examples of scope limitations? - (answer)- Time constraints
- Inability to obtain sufficient appropriate evidence (if cannot perform alternative
procedures, auditor would then express qualified or disclaimer)
- Refusal of mgmt. to provide written representation and/or to acknowledge its
responsibility for the fair presentation of the financial statements in conformity
with GAAP
- Refusal of client's attorney to respond to inquiry
If management imposes a limitation and will not remove it, what should the
auditor do? - (answer)The auditor should communicate with those charged with
governance and determine whether its possible to perform alternative
procedures.
** if the auditor is unable to obtain sufficient appropriate evidence due to mgmt
imposed limitation and auditor concludes the possible effects of misstatements
can be material and pervasive, then the auditor should disclaim an opinion or
withdraw.
In unqualified opinion for issuer, where do you refer to the standards? -
(answer)PCAOB - basis for opinion
GAAP - opinion on FS section
, What is a CAM (critical audit matter)? - (answer)A matter that was communicated
or required to be communicated to the audit committee and that:
01. relates to accounts or disclosures that are material to FS; and
02. involved especially challenging, subjective, or complex auditor judgement
How do you document a CAM? - (answer)Make sure to IDENTIFY it on a PAD of
paper.
- identification of CAM
- description of the principal considerations that led the auditor to determine the
matter was a CAM
- description of how the CAM was addressed in the audit; and
- reference to the relevant FS accounts or disclosures
For an unmodified report for nonissuers, when do you refer to appropriate
standards? - (answer)GAAS - basis for opinion and auditor's responsibilities
paragraphs
GAAP - management's responsibility and opinion paragraphs
Format of Unmodified Opinion (OBRA) - NONISSUER - (answer)- Opinion
- Basis for Opinion
- Responsibilities of Management for the FS
- Auditor's Responsibilities for the Audit of the FS
