CPA Audit- Exam Questions And Answers

CPA Audit- Exam Questions And Answers the primary objective of an auditor when considering the acceptance of an initial audit engagement of a nonissuer is to: a) establish whether the preconditions for an audit are present b) agree w mgt on timing the tests at interim c) limit the auditor's responsibility if mgt fails to provide written representations d) specify the degree to which mgt intends to rely on the auditor's testing of internal ctrls - ANS- establish whether the preconditions for an audit are present an auditor is testing a client's pension benefit obligation. which of the following types of evidence would be most appropriate for determining that the financial statement balance is fairly stated? a) client prepared schedule showing accounting entries made to the GL balance b) an actuarial valuation obtained by an outside firm c) confirmation of pmts received by the retirees d) analytical procedures that compare last year's balance to this year's balance - ANS-an actuarial valuation obtained by an outside firm because it calculates fair value of the obligation which of the following would provide an auditor of a nonissuer with the best evidence of fair value pertaining to a client's investments in derivative instruments that are listed on a national exchange and disclosed at fair value? a) client's personnel who trade the derivative b) quoted market prices c) docs related to the original purchase of the derivative d) estimates of fair value provided by broker dealers - ANS-quoted market prices since it is on a national exchange which of the following qualitative factors would an auditor consider most relevant to the consideration of whether a discovered misstatement is material? CONTINUES...