This is Auditing MCQs section with detailed explanations for preparation of screening tests, interviews for government jobs. In this section candidate will learn MCQs on variety of topics from the subject.
identify cases of unrecorded revenue
ensure proper disclosure in the balance sheet
recompute accrued income on the data of balance sheet
Any of these
See Answer
Added By: Ak Aamir
Answer
: identify cases of unrecorded revenue
Explanation
: N/A
The auditor cannot give an opinion due to lack of evidence.
The clients financial statements were found to be materially misstated.
The auditor could not conduct any tests due to lack of controls.
The auditor did not find anything to indicate that a material misstatement exists.
: The auditor did not find anything to indicate that a material misstatement exists.
one audit firm should audit the IFI and a different firm should audit the financial statements for the year as a whole.
one accountancy firm should review the IFI and a different firm should audit the financial statements for the year as a whole.
the same firm should audit the IFI and the financial statements for the year as a whole.
the same firm should review the IFI and the financial statements for the year as a whole.
: the same firm should review the IFI and the financial statements for the year as a whole.
When a company negotiates a friendly takeover, it usually appoints a firm of accountants to carry out due diligence on the takeover target.
In an attestation engagement, the accountant is required to report on the quality of work performed.
In a review engagement, evidence is gathered mainly by means of computation and inspection.
In an engagement to review financial statements, the amount of work required is the same as for an audit
: When a company negotiates a friendly takeover, it usually appoints a firm of accountants to carry out due diligence on the takeover target.
Positive assurance
Negative assurance
High level of assurance
No assurance
: Negative assurance
Conducting the inventory count
Obtaining and evaluating audit evidence on the financial statements
Calculating the year-end accruals figure for inclusion in the accounts
Providing representations to management
: Obtaining and evaluating audit evidence on the financial statements
Introductory paragraph specifying the pages to which the report relates and the accounting convention adopted
Basis of the opinion
Involvement of any specialist
Statement of responsibilities of directors and auditors
: Involvement of any specialist
The gap between how the directors of a company perform their duties and how the shareholders expect them to perform
The gap between how the directors of a company perform their duties and how the general public expects them to perform
The gap between the public perception of the role of company auditors and their statutory role and responsibilities
The gap between the auditors own perception of their duties and how they are set out in the Companies Act
: The gap between the public perception of the role of company auditors and their statutory role and responsibilities
Other audit clients
Previous years
Other companies in the same industry
Budget
: Other audit clients
They are the best source of audit evidence
They should be used only when there is a lack of other substantive audit evidence
They should be used only when there is other substantive audit evidence to complement it
Shareholders receive a copy of all material written representations
: They should be used only when there is a lack of other substantive audit evidence
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