Auditing-MCQ2 - Unqualified c Full assurance d Exceptional...

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Auditing – MCQ No. 2 1. Which of the following audit phases would generally be conducted before all of the others listed below? a. Auditing business processes and related accounts b. Evaluation of audit evidence c. Gaining an understanding of the client’s industry d. Consideration of internal control systems 2. Gaining an understanding of the client and its environment includes all of the following areas except: a. Regulatory issues unique to the industry b. The entity’s application of accounting policies c. The audit fee and timeline for completion of the work d. The entity’s business risks
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3. The most favorable type of audit report opinion for the client to receive is: a. Qualified b.
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Unformatted text preview: Unqualified c. Full assurance d. Exceptional 4. The study and practice of auditing is unlike other areas in accounting because it: a. Requires the memorization of formulas and patterns b. Requires the knowledge of GAAP c. Requires common sense and some creativity d. Is required by law for all companies in the United States 5. Audit risk: a. Can be completely eliminated through appropriate sampling of transactions b. Is the risk that a ‘clean’ opinion will be issued when, in reality, the financial statements are materially misstated c. Is what creates the demand for an audit d. Is the risk that a company may hire an incompetent auditor...
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This note was uploaded on 04/07/2012 for the course BUSINESS 1023 taught by Professor Msaeed during the Spring '12 term at CSU Channel Islands.

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Auditing-MCQ2 - Unqualified c Full assurance d Exceptional...

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