Audit Services in General
1)
The word auditing comes from
the Latin audire, which means:
a.
To see
b.
To detect
c.
To hear
d.
To test
2)
Which of the following is an
incorrect phrase?
a.
Auditing is a systematic
process
b.
Auditing objectively obtains
and evaluates evidence
c.
Auditing evaluates evidence
regarding assurance
d.
Auditing communicates results
to interested users
3)
Broadly defined, the subject
matter of any audit consists of:
a.
Financial statements
b.
Economic data
c.
Assertions
d.
Operating data
4)
Representations by management,
explicit or otherwise, that are embodied in the financial statements, as used
by the auditor to consider the different types of potential misstatements that
may occur.
a.
Financial statement assertions
b.
Audit evidence
c.
Notes to the financial
statements
d.
Disclosure requirements
5)
Financial statements need to be
prepared in accordance with one, or a combination of:
a.
PFRS
b.
IFRS
c.
Other authoritative basis
d.
All of the answers
D,D,C,A,D
6)
This term is used to refer to
the person or persons conducting the audit, usually the engagement partner or
other members of the engagement team, or, as applicable, the firm.
a.
Users of financial statements
b.
Those charged with governance
c.
Auditor
d.
Management
7)
The auditor communicates the
results of his or her work through the medium of the:
a.
Audit engagement letter
b.
Audit report
c.
Management letter
d.
Notes to the financial
statements
8)
An audit of financial
statements is conducted to determine if the:
a.
Organization is operating
efficiently and effectively
b.
Auditee is following specific
procedures or rules set down by some higher authority
c.
Overall financial statements
are stated in accordance with an applicable financial reporting framework
d.
Client’s internal control is
functioning as intended
9)
This type of audit is performed
to determine whether an entity’s financial statements are fairly stated in
conformity with generally accepted accounting principles
a.
Financial statement audit
b.
Operational audit
c.
Compliance audit
d.
Internal audit
10)
The overall objectives of the
independent auditor in conducting financial statement audits is:
a.
To prove accuracy and
reliability of financial statements
b.
To prepare and present
financial statements in accordance with PFRS
c.
To obtain reasonable assurance
about whether the financial statements are free from material misstatements,
due to fraud and error
d.
To report on the financial
statements and communicate as required by PAS
C,B,C,A,C
11)
The purpose of an audit of
financial statements is to:
a.
Enhance understanding of the
stakeholders of the company
b.
Provide government agencies,
such as BIR with basis for assessments
c.
Enhance the degree of
confidence of intended users of the financial statements
d.
Enhance the knowledge and
skills of external auditors
12)
Most of the independent
auditor’s work in formulating an opinion on financial statements consists of:
a.
Studying and evaluating
internal control
b.
Obtaining and examining
evidential matter
c.
Examining cash transactions
d.
Comparing recorded
accountability with physical existence of property
13)
A difference between the
amount, classification, presentation, or disclosure of a reported financial
statement item and the amount, classification, presentation, or disclosure that
is required for the item to be in accordance with the applicable financial
reporting framework
a.
Non-compliance
b.
Fraud
c.
Misstatement
d.
Error
14)
An unintentional misstatement
in financial statements, including the omission of an amount or disclosure
a.
Non-compliance
b.
Fraud
c.
Misstatement
d.
Error
15)
An intentional act by one or
more individuals among management, those charged with governance, employees, or
third parties, involving the use of deception to obtain an unjust or illegal
advantage.
a.
Non-compliance
b.
Fraud
c.
Misstatement
d.
Error
C,B,C,D,B
16)
The primary responsibility for
the prevention and detection of fraud and error rests with
a.
The external auditor, the
company’s management, and those charged with governance
b.
The company’s management
c.
Those charged with governance
d.
The company’s management and
those charged with governance
17)
This type of audit involves a
review of an organization’s procedures and methods for the purpose of
evaluating efficiency and effectiveness of operations, and identifying areas
for improvement.
a.
Financial statement audit
b.
Operational audit
c.
Compliance audit
d.
Internal audit
18)
Which of the following best
describes the operational audit?
a.
It requires the constant review
by internal auditors of the administrative controls as they relate to
operations of the company
b.
It concentrates on implementing
financial and accounting control in a newly organized company
c.
It attempts and is designed to
verify the fair presentation of a company’s results of operations
d.
It concentrates on seeking out
aspects of operations in which waste would be reduced by the introduction of
controls
19)
This type of audit is performed
in order to determine the degree of adherence to specific procedures and rules
set down by some higher authority
a.
Financial statement audit
b.
Operational audit
c.
Compliance audit
d.
Internal audit
20)
Which of the following types of
audits are most similar?
a.
Operational audits and
compliance audits
b.
Independent financial statement
audits and operational audits
c.
Compliance audits and
independent financial statement audits
d.
Internal audits and independent
financial statement audits
D,B,D,C,C
21)
Which of the following types of
auditing is performed most commonly by CPAs for more than one client and on a
contractual basis?
a.
Internal auditing
b.
Income tax auditing
c.
External auditing
d.
Government auditing
22)
This is an independent
appraisal activity establish within an entity as a service to the entity:
a.
External or independent
auditing
b.
Internal audit function
c.
Government auditing
d.
Compliance auditing
23)
The overall objective of
internal auditing is to
a.
Attest to the efficiency with
which resources are employed
b.
Ascertain that controls are
costs-justified
c.
Provide assurance that
financial data have been accurately recorded
d.
Assist the members of the
organization in the effective discharge of their responsibilities
24)
Which of the following
statements is not a distinction between independent auditing and internal
auditing?
a.
Independent auditors represent
third party users external to the auditee entity, whereas internal auditors
report directly to management
b.
Although independent auditors
strive for both validity and relevance of evidence, internal auditors are
concerned almost exclusively with validity
c.
Internal auditors are employees
of the auditee, whereas external auditors are independent contractors
d.
The internal auditor’s span of
coverage goes beyond financial auditing to encompass operational and
performance auditing
25)
This type of audit goes beyond
the usual financial statement audit, to include audits of compliance with laws
and regulations, operations of governmental entities, and the proper
disbursement and management of public funds.
a.
External or independent
auditing
b.
Internal audit function
c.
Government auditing
d.
Compliance auditing
26)
In government auditing, the
three elements of expanded scope auditing are:
a.
Goal analysis, audit of
operations, audit of systems
b.
Financial and compliance,
economy and efficiency, program results
c.
Pre-audit, post-audit, internal
audit
d.
National government audit,
local government audit, corporation audit
27)
An audit designed to determine
the extent to which the desired results of an activity established by the
legislative or other authorizing body are being achieved.
a.
Economy audit
b.
Efficiency audit
c.
Program results audit
d.
Financial-related audit
C,B,D,B,C,B,C
No comments:
Post a Comment