TEST BANK For Auditing & Assurance Services: A
Systematic Approach, 12th Edition
Chapters 1 - 21 Complete
,Chapter 1: An Introduction to Assurance and Financial Statement Auditing
Chapter 2: The Financial Statement Auditing Environment
Chapter 3: Audit Planning, Types of AudittTests, and Materiality
Chapter 4: Risk Assessment
Chapter 5: Evidencetand Documentation
Chapter 6: Internal Control in atFinancial StatementtAudit
Chapter 7: Auditing Internal Control over Financial Reporting
Chapter 8: Audit Sampling: An Overview and Application to Tests of Controls
Chapter 9: Audit Sampling: An Application to Substantive Tests of AccounttBalances
Chapter 10: Auditing the Revenue Process
Chapter 11: Auditing the Purchasing Process
Chapter 12: Auditing the Human Resource Management Process
Chapter 13: Auditing the Inventory Management Process
Chapter 14: Auditing the Financing/Investing Process: Prepaid Expenses, Intangible Assets, and
Property, Plant, and Equipment
Chapter 15: Auditing the Financing/Investing Process: Long-
Term Liabilities, Stockholders’ Equity, and Income StatementtAccounts
Chapter 16: Auditing the Financing/Investing Process: Cash and Investments
Chapter 17: Completingtthe AudittEngagement
Chapter 18: Reports on Audited Financial Statements
Chapter 19: Professional Conduct, Independence, and Quality Management
Chapter 20: Legal Liability
Chapter 21: Assurance, Attestation, and Internal Auditing Services
,Auditing& AssurancetServices: ASystematic Approach, 12et(Messier) Chapter 1
An Introduction to Assuranceand Financial StatementtAuditing
1) Auditingtfocusesonrules, techniques, andcomputationsrequiredtoprepareandanalyzefin
ancial information.
ANSWER: FALSE Diffic
ulty:1Easy
Topic: The Importancefor Studying Auditing
Learning Objective: 01-
01 Understandwhystudyingauditing cantbevaluablettoyoutwhetherornottyouplantotbecome anaud
itor,tandtwhy ittis differenttfrom studyingaccounting.
Bloom's: Remember AAC
SB: Communication
AICPA: BBLegal; FNDecision Making
2) Decisiontmakersdemandtreliableinformationthatisprovidedbyaccountants.
ANSWER: TRUEDifficu
lty:1Easy
Topic: The Demandfor Auditingand Assurance
Learning Objective: 01-
02 Understand thetdemandforauditing andbeabletoexplaintthetdesiredtcharacteristicsofauditorsta
ndauditservicesthroughtananalogytoahousetinspectorandahousetinspection service.
Bloom's: Understand AA
CSB: Communication
AICPA: FNDecisiontMaking; BBIndustry
3) Informationasymmetryseldomtoccurs.
ANSWER: FALSE Diffic
ulty:2tMedium
Topic: The Demandfor Auditingtand Assurance
Learning Objective: 01-
02 Understand thetdemandforauditing andbeabletoexplain thetdesiredcharacteristicsofauditorsta
ndauditservicesthroughtananalogytoathousetinspectorandtahousetinspection service.
Bloom's: Apply
AACSB: Communication
AICPA: BBIndustry; FNReporting
, 4) Conflictsofinterestoftenoccurbetweenabsenteeownersandmanagers.
ANSWER: TRUEDifficu
lty:2Medium
Topic: The Demandfor Auditingtand Assurance
Learning Objective: 01-
02 Understandtthetdemandforauditing andbeabletoexplaintthetdesiredtcharacteristicsofauditorsta
ndauditservicesthroughtananalogytoathousetinspectorandtahousetinspection service.
Bloom's: Apply
AACSB: Communication
AICPA: BBIndustry; FNReporting
5) Auditingtservicesandattestationtservicesarethesame.
ANSWER: FALSE Diffic
ulty:1Easy
Topic: Auditing, Attest, andtAssurancetServices Defined
Learning Objective: 01-
03 Understandtherelationshipsamongtauditing, attestation, andassuranceservices.
Bloom's: Understand AA
CSB: Communication
AICPA: BBIndustry; FNReporting
6) Auditingtisattypetofattesttservice.
ANSWER: TRUEDifficu
lty:1Easy
Topic: Auditing, Attest, andtAssurancetServices Defined
Learning Objective: 01-
03 Understandtherelationshipsamongtauditing, attestation, andassuranceservices.; 01-
04 Knowthebasicdefinitionofafinancial statement audit.
Bloom's: UnderstandtAA
CSB: Communication
AICPA: BBIndustry; FNReporting
7) Testingalltransactionstthatoccurredduringtthetperiodiscostprohibitive.
ANSWER: TRUEDifficu
lty: 2 MediumtTopic: The
AuditProcess
Learning Objective: 01-
06 Betablettoexplainwhyonmostaudittengagementsanauditortests onlyasampletoftransactionstha
t occurred.
Bloom's: Apply
AACSB: Communication
AICPA: FNDecision Making; BBCritical Thinking
Systematic Approach, 12th Edition
Chapters 1 - 21 Complete
,Chapter 1: An Introduction to Assurance and Financial Statement Auditing
Chapter 2: The Financial Statement Auditing Environment
Chapter 3: Audit Planning, Types of AudittTests, and Materiality
Chapter 4: Risk Assessment
Chapter 5: Evidencetand Documentation
Chapter 6: Internal Control in atFinancial StatementtAudit
Chapter 7: Auditing Internal Control over Financial Reporting
Chapter 8: Audit Sampling: An Overview and Application to Tests of Controls
Chapter 9: Audit Sampling: An Application to Substantive Tests of AccounttBalances
Chapter 10: Auditing the Revenue Process
Chapter 11: Auditing the Purchasing Process
Chapter 12: Auditing the Human Resource Management Process
Chapter 13: Auditing the Inventory Management Process
Chapter 14: Auditing the Financing/Investing Process: Prepaid Expenses, Intangible Assets, and
Property, Plant, and Equipment
Chapter 15: Auditing the Financing/Investing Process: Long-
Term Liabilities, Stockholders’ Equity, and Income StatementtAccounts
Chapter 16: Auditing the Financing/Investing Process: Cash and Investments
Chapter 17: Completingtthe AudittEngagement
Chapter 18: Reports on Audited Financial Statements
Chapter 19: Professional Conduct, Independence, and Quality Management
Chapter 20: Legal Liability
Chapter 21: Assurance, Attestation, and Internal Auditing Services
,Auditing& AssurancetServices: ASystematic Approach, 12et(Messier) Chapter 1
An Introduction to Assuranceand Financial StatementtAuditing
1) Auditingtfocusesonrules, techniques, andcomputationsrequiredtoprepareandanalyzefin
ancial information.
ANSWER: FALSE Diffic
ulty:1Easy
Topic: The Importancefor Studying Auditing
Learning Objective: 01-
01 Understandwhystudyingauditing cantbevaluablettoyoutwhetherornottyouplantotbecome anaud
itor,tandtwhy ittis differenttfrom studyingaccounting.
Bloom's: Remember AAC
SB: Communication
AICPA: BBLegal; FNDecision Making
2) Decisiontmakersdemandtreliableinformationthatisprovidedbyaccountants.
ANSWER: TRUEDifficu
lty:1Easy
Topic: The Demandfor Auditingand Assurance
Learning Objective: 01-
02 Understand thetdemandforauditing andbeabletoexplaintthetdesiredtcharacteristicsofauditorsta
ndauditservicesthroughtananalogytoahousetinspectorandahousetinspection service.
Bloom's: Understand AA
CSB: Communication
AICPA: FNDecisiontMaking; BBIndustry
3) Informationasymmetryseldomtoccurs.
ANSWER: FALSE Diffic
ulty:2tMedium
Topic: The Demandfor Auditingtand Assurance
Learning Objective: 01-
02 Understand thetdemandforauditing andbeabletoexplain thetdesiredcharacteristicsofauditorsta
ndauditservicesthroughtananalogytoathousetinspectorandtahousetinspection service.
Bloom's: Apply
AACSB: Communication
AICPA: BBIndustry; FNReporting
, 4) Conflictsofinterestoftenoccurbetweenabsenteeownersandmanagers.
ANSWER: TRUEDifficu
lty:2Medium
Topic: The Demandfor Auditingtand Assurance
Learning Objective: 01-
02 Understandtthetdemandforauditing andbeabletoexplaintthetdesiredtcharacteristicsofauditorsta
ndauditservicesthroughtananalogytoathousetinspectorandtahousetinspection service.
Bloom's: Apply
AACSB: Communication
AICPA: BBIndustry; FNReporting
5) Auditingtservicesandattestationtservicesarethesame.
ANSWER: FALSE Diffic
ulty:1Easy
Topic: Auditing, Attest, andtAssurancetServices Defined
Learning Objective: 01-
03 Understandtherelationshipsamongtauditing, attestation, andassuranceservices.
Bloom's: Understand AA
CSB: Communication
AICPA: BBIndustry; FNReporting
6) Auditingtisattypetofattesttservice.
ANSWER: TRUEDifficu
lty:1Easy
Topic: Auditing, Attest, andtAssurancetServices Defined
Learning Objective: 01-
03 Understandtherelationshipsamongtauditing, attestation, andassuranceservices.; 01-
04 Knowthebasicdefinitionofafinancial statement audit.
Bloom's: UnderstandtAA
CSB: Communication
AICPA: BBIndustry; FNReporting
7) Testingalltransactionstthatoccurredduringtthetperiodiscostprohibitive.
ANSWER: TRUEDifficu
lty: 2 MediumtTopic: The
AuditProcess
Learning Objective: 01-
06 Betablettoexplainwhyonmostaudittengagementsanauditortests onlyasampletoftransactionstha
t occurred.
Bloom's: Apply
AACSB: Communication
AICPA: FNDecision Making; BBCritical Thinking
