The rights and obligations assertion Essay
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1)If reported sales for 2010 erroneously include sales that occur in 2011, the assertion violated on the 2010 statements would be 2)The rights and obligations assertion applies to 3)Which of the following assertions is NOT made by management in placing an item in the financial statements 4)Section 11 of the Securities Act of 1933 uses the term material fact to limit the amount of information required. Under the Act, the standard used to determine an items materiality 5)Individuals or entities the auditor knew or should have known and would rely on the audit report in making business and investment decisions are 6)Section 18 liability is relatively narrow in scope because it relates to a false or misleading statement in documents filed with the 7)Within generally accepted auditing standards, general standards relate primarily to 8)Statements on auditing standards (SAS) are interpretations of what 9)Which of the following best describes the relationship that should exist between the external auditor and the management of the client company 10)Statement on Quality Control Standards No.
2 identifies certain quality control elements that should be considered when performing which types of services 11)Internal auditors are primarily involved with 12)The Government Accounting Office reports directly to the 13)With respect to audit objectives, the term validity relates to which of the assertions below 1
4)Which of the following procedures consists of seeking information from knowledgeable persons throughout or outside the entity 15)Specific audit objectives are normally 16)The assessment of inherent risk requires considering matters that have a pervasive effect on assertions for all or many accounts and matters that may pertain only to assertions for specific accounts.
Which of the following is an example of a pervasive effects matter 17)The assessment of inherent risk requires considering matters that have a pervasive effect on assertions for all or many accounts and matters that may pertain only to assertions for specific accounts. Which of the following is an example of a specific account matter 18)The risk that the auditor may unknowingly fail to appropriately modify his or her opinion on financial statements that are materially misstated is 19)In accepting an engagement, an auditor takes on professional responsibilities to 20)In communicating with the previous auditor, the potential successor should make specific and reasonable inquiries regarding matters that may affect the decision to accept the engagement. Which of the following items is least likely to be included in the inquiries 21)The importance of the accept/reject decision for a particular client is reflected in the inclusion of acceptance and continuation of clients as
22)In making preliminary judgments about materiality, the auditor initially determines the aggregate level of materiality for each statement. For planning purposes, the auditor should use the 23)Professional standards recognize that a misstatement that is quantitatively immaterial may be qualitatively material. In regards to these items, professional standards require the auditor to 24)When setting the level of materiality on a particular engagement, the auditor must consider 25)The Committee of Sponsoring Organizations (COSO) report identified five interrelated components of internal control. Since then, a sixth category has been identified, which is 26)Which of the following is NOT one of the interrelated components of internal controls identified by the COSO report 27)Which of the following is NOT one of the fundamental concepts in the COSO reports definition of internal control 28)Which of the following necessary controls would address a potential misstatement arising from a voucher being paid twice
29)The nature of tests of controls relates to the type of evidence obtained. Which of the following is NOT an example of a type of evidence relevant to tests of controls 30)Which of the following is one of the four basic functions of every transaction 31)To emphasize the importance of integrity and ethical values among all personnel or an organization, the chief executive officer and other top managers should do all of the following EXCEPT 32)Which of the following is NOT one of the factors that make up the control environment 33)An effective accounting system should identify and record only the valid transaction of the entity that occurred in the current period, which relates to the
34)Who is responsible for establishing the process and controls for preparing accounting estimates 35)An inaccurate form of the audit risk model would show that 36)Revising the planned level of detection risk will be necessary whenever 37)PPS sampling would most likely NOT be cost-effective in 38)Which of the following is NOT an advantage of PPS sampling 39)PPS sampling should NOT be used when 40)Which of the following is NOT a hardware and systems software control 41)Which of the following is NOT recognized as a type of general controls 42)Which of the following management responsibilities is NOT established under PCAOB standards