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Unformatted text preview: 13-1CHAPTER 13 Exercise: Overall Audit Plan and Audit Program1. easy A listing of all the things which the auditor will do to gather sufficient, competent evidence is the a. audit plan. b. audit program. c. audit procedure. d. audit risk model. 2. easy Shown below (1 through 5) are the five types of tests which auditors use to determine whether financial statements are fairly stated. Which three are substantive tests? 1. procedures to obtain an understanding of internal control 2. tests of controls 3. tests of transactions 4. analytical procedures 5. tests of balances a. 1, 2, and 3. b. 3, 4, and 5. c. 2, 3, and 5. d. 2, 3, and 4. 3. For efficiency, tests of controls are frequently done at the same time as easy a. analytical procedures. b. compliance tests. c. substantive tests of transactions. d. substantive tests of balances. 4. In which stage(s) of an audit can analytical procedures be performed? easy a. In the planning stage. b. In conjunction with tests of transactions and tests of details of balances. c. In the completion stage. d. During all three stages. 5. The purpose of tests of controls is to provide reasonable assurance that the easy a. accounting treatment of transactions and balances is valid and proper. b. accounting control procedures are functioning as intended. c. entity has complied with disclosure requirements of generally accepted accounting principles. d. entity has complied with requirements of quality control. 6. In the context of an audit of financial statements, substantive tests are audit procedures that easy a. may be eliminated under certain conditions. b. are designed to discover significant subsequent events. c. may be either tests of transactions, direct tests of financial balances, or analytical procedures. d. will increase proportionately with the auditor’s reliance on internal control. 7. medium Which of the following techniques is not useful for obtaining an understanding of internal controls? a. Make inquiries of the client’s personnel. b. Examine documents and records. c. Read industry trade magazines. 13-2d. Observe client activities and operations. 8. The most important consideration in developing the audit plan and audit program is the medium a. client’s size....
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- Fall '09
- substantive tests