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All answers have been recorded in red.CHAPTER ONE PROBLEMS1-15 (Objectives 1-5, 1-6)The following questions deal with assurance services and types of audits. Choose the best response.a.Which of the following is considered an assurance engagement?a.Bookkeepingb.Preparationc.Compilationd.AUDITb.Which of the following engagements is most likely to be considered an operational audit?c.In a financial statement audit, the auditor obtains a reasonable level of assurance about whetherthe financial statements are free of material misstatement in order to express an opinion. In order to obtain reasonable assurance, the auditor must1-21 (Objectives 1-6, 1-7)In the normal course of performing their responsibilities, auditors often conduct audits or reviews of the following:3.A bond indenture agreement to make sure a company is following all requirements of the contract.4.Internal controls at a casino to ensure the casino is in compliance with federal and state regulations.
All answers have been recorded in red.5.Computer operations of a corporation to evaluate whether the computer center is being operated as efficiently as possible.6.Annual statements for the use of management.7.Operations of the IRS to determine whether the internal revenue agents are using their time efficiently in conducting audits.8.Statements for bankers and other creditors when the client is too small to have an audit staff.9.Financial statements of a branch of the federal government to make sure that the statements present fairly the actual disbursements made during a period of time.