BYU ACC 406 AUDITING MIDTERM 1
QUESTIONS (2025/26) WITH COMPLETE
SOLUTIONS.
1 of 97
Definition
A systematic process of objectively obtaining and evaluating
evidence regarding assertions about economic actions and events
to ascertain the degree of correspondence between those
assertions and established criteria and communicating the results
to interested users
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Audit Plan and Strategy Assurance definition
, Auditing definition Attest definition
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2 of 97
Term
Judgmental misstatements
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dr: is the risk that the procedures performed by the auditor will not detect a
misstatement that exists and that could be material, either individually or in
combination with other misstatements.
misstatements that arise from differences between the auditor's judgments
concerning accounting estimates and management's estimates that the
auditor considers unreasonable or inappropriate
misstatements about which there is no doubt. in other words, the auditors can
know the exact amount of misstatement by testing
auditor's best estimate of misstatements in populations, involving the projection
of misstatements identified in an audit sample to the entire population from
which the sample was drawn.
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, Definition
- Identifying specific controls that will be relied upon
- performing tests of controls
- concluding the achieved level of control risk
- documenting the achieved level of control risk
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2.Preliminary engagement Other nonaudit services
Judgmental misstatements Assessing control risk
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4 of 97
Term
T or F: auditors can know the actual or achieved level of audit risk at
the end of the audit
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- nature of the entity
- industry, regulatory, and other external factors
- objectives, strategies, and related business risks
- entity performance measures
- internal control
, represent the auditor's risk assessment and the assertion being tested. Some
assertions are more important than others, thus bigger in size.
F: auditors can only ASSESS the achieved audit risk; if the assessed
achieved audit risk is less than or equal to the PLANNED level of audit risk -
-> issue an unqualified report
PCAOB: Public Company Accounting Oversight Board. issues auditing standards for
audits of public companies
ASB: Auditing Standards Board. Under AICPA, issues auditing standards for audits
of nonpublic companies; also issues attestation and assurance standards
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5 of 97
Term
CH 3: Audit Planning, Types of Audit Tests, and Materiality
Procedures for Evaluating a Prospective Client
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Study table 4-2 on p. 85 Study figure 3-3 on p. 65
Study table 2-1 on p. 55 Study table 3-1 on p. 71
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6 of 97
QUESTIONS (2025/26) WITH COMPLETE
SOLUTIONS.
1 of 97
Definition
A systematic process of objectively obtaining and evaluating
evidence regarding assertions about economic actions and events
to ascertain the degree of correspondence between those
assertions and established criteria and communicating the results
to interested users
Give this one a try later!
Audit Plan and Strategy Assurance definition
, Auditing definition Attest definition
Don't know?
2 of 97
Term
Judgmental misstatements
Give this one a try later!
dr: is the risk that the procedures performed by the auditor will not detect a
misstatement that exists and that could be material, either individually or in
combination with other misstatements.
misstatements that arise from differences between the auditor's judgments
concerning accounting estimates and management's estimates that the
auditor considers unreasonable or inappropriate
misstatements about which there is no doubt. in other words, the auditors can
know the exact amount of misstatement by testing
auditor's best estimate of misstatements in populations, involving the projection
of misstatements identified in an audit sample to the entire population from
which the sample was drawn.
Don't know?
3 of 97
, Definition
- Identifying specific controls that will be relied upon
- performing tests of controls
- concluding the achieved level of control risk
- documenting the achieved level of control risk
Give this one a try later!
2.Preliminary engagement Other nonaudit services
Judgmental misstatements Assessing control risk
Don't know?
4 of 97
Term
T or F: auditors can know the actual or achieved level of audit risk at
the end of the audit
Give this one a try later!
- nature of the entity
- industry, regulatory, and other external factors
- objectives, strategies, and related business risks
- entity performance measures
- internal control
, represent the auditor's risk assessment and the assertion being tested. Some
assertions are more important than others, thus bigger in size.
F: auditors can only ASSESS the achieved audit risk; if the assessed
achieved audit risk is less than or equal to the PLANNED level of audit risk -
-> issue an unqualified report
PCAOB: Public Company Accounting Oversight Board. issues auditing standards for
audits of public companies
ASB: Auditing Standards Board. Under AICPA, issues auditing standards for audits
of nonpublic companies; also issues attestation and assurance standards
Don't know?
5 of 97
Term
CH 3: Audit Planning, Types of Audit Tests, and Materiality
Procedures for Evaluating a Prospective Client
Give this one a try later!
Study table 4-2 on p. 85 Study figure 3-3 on p. 65
Study table 2-1 on p. 55 Study table 3-1 on p. 71
Don't know?
6 of 97
