Auditing MCQs with Answers

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.

1. 61 Which of the following factors is most important in determining the appropriations of audit evidence
   

   1. The reliability of audit evidence and its relevance in meeting the audit objective

   2. The objectivity and integrity of the auditor

   3. The quantity of audit evidence

   4. The independence of the source of evidence

   See Answer

   Added By: Ak Aamir

   Answer

   : The reliability of audit evidence and its relevance in meeting the audit objective

   Explanation

   :
   N/A

2. 62 When is evidential matter, generally, considered sufficient
   

   1. When it constitutes entire population

   2. When it is enough to provide a basis for giving reasonable assurance regarding truthfulness

   3. When it is objective and relevant

   4. When auditor collects and evaluates it independently

   See Answer

   Added By: Ak Aamir

   Answer

   : When it is enough to provide a basis for giving reasonable assurance regarding truthfulness

   Explanation

   :
   N/A

3. 63 Which of the following is not corroborative evidence
   

   1. Minutes of meetings

   2. Confirmations from debtors

   3. Information gathered by auditor through observation

   4. Worksheet supporting consolidated financial statements

   See Answer

   Added By: Ak Aamir

   Answer

   : Worksheet supporting consolidated financial statements

   Explanation

   :
   N/A

4. 64 What would most appropriately describe the risk of incorrect rejection in terms of substantive testing
   

   1. The auditor concludes balance is materially correct when in actual fact it is not

   2. The auditor concludes that the balance is materially misstated when in actual fact it not

   3. The auditor has rejected an item for sample which was material

   4. None of the above

   See Answer

   Added By: Ak Aamir

   Answer

   : The auditor concludes that the balance is materially misstated when in actual fact it not

   Explanation

   :
   N/A

5. 65 Which of the following affects audit effectiveness
   

   1. Risk of over reliance

   2. Risk of incorrect rejection

   3. Risk of incorrect acceptance

   4. Both A and C

   See Answer

   Added By: Ak Aamir

   Answer

   : Both A and C

   Explanation

   :
   N/A

6. 66 What would most effectively describe the risk of incorrect acceptance in terms of substantive audit testing
   

   1. The auditor has ascertained that the balance is materially correct when in actual fact it is not

   2. The auditor concludes the balance is materially misstated when in actual fact is not

   3. The auditor has rejected an item from sample which was not supported by documentary evidence

   4. He applies random sampling on data which is inaccurate and inconsistent

   See Answer

   Added By: Ak Aamir

   Answer

   : The auditor has ascertained that the balance is materially correct when in actual fact it is not

   Explanation

   :
   N/A

7. 67 Audit programme is prepared by____________
   

   1. The auditor

   2. The client

   3. The audit assistants

   4. The auditor and his audit assistants

   See Answer

   Added By: Ak Aamir

   Answer

   : The auditor and his audit assistants

   Explanation

   :
   N/A

8. 68 The working papers which auditor prepares for financial statements audit are___________
   

   1. Evidence for audit conclusions

   2. Owned by the client

   3. Owned by the auditor

   4. Retained in auditors office until a change in auditors

   See Answer

   Added By: Ak Aamir

   Answer

   : Owned by the auditor

   Explanation

   :
   N/A

9. 69 The quantity of audit working papers complied on engagement would most be affected by__________
   

   1. Managements integrity

   2. Auditors experience and professional judgment

   3. Auditors qualification

   4. Control risk

   See Answer

   Added By: Ak Aamir

   Answer

   : Auditors experience and professional judgment

   Explanation

   :
   N/A

10. 70 Which of the following best describes the primary purpose of audit programme preparation
    

    1. To detect errors or fraud

    2. To comply with GAAP appropriate evidence

    3. To gather sufficient

    4. To assess audit risk

    See Answer

    Added By: Ak Aamir

    Answer

    : To gather sufficient

    Explanation

    :
    N/A