ch03 - ch03 Student 1 An important element of a public accounting firm's system of quality control is the decision about client acceptance and retention

ch03 - ch03 Student 1 An important element of a public...

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ch03Student: ___________________________________________________________________________1.An important element of a public accounting firm's system of quality control is the decision about client acceptance and retention. True False2.The Code of Professional Conduct permits predecessor auditors to give information to the auditors without client consent. True False3.Engagement letters are not necessary for continuing clients. True False4.A second audit partner is required for audits of financial statements filed with the SEC. True False5.CAATs software requires auditors to do the original programming. True False6.A first-time audit requires more work than a repeat engagement. True False7.A major reason for thinking about overall materiality at the planning stage is to try to fine-tune the audit for effectiveness and efficiency. True False8.The use of computer-assisted auditing techniques has significantly changed auditing objectives. True False9.The computer has simplified auditing by providing a better audit trail. True False10.The use of computer systems has increased the potential for management supervision of the internal control system. True False11.The degree of computer complexity and use may influence the nature, timing, and extent of audit procedures. True False12.Control activities in computerized accounting systems may have characteristics that differ from manual control activities designed to accomplish the same control objectives. True False13.CAATs software may be utilized to read, compute, and operate on machine-readable records. True False14.The most important facet of the current audit evidence files is the requirement that they show the auditor's decision-making process and conclusions reached. True False15.The concept of materiality emphasizes the accountants' and managers' point of view, not the users' point of view. True False
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16.Auditors are generally left without definitive, quantitative guidelines for determining materiality. True False17.When management can exercise discretion over an accounting treatment, auditors tend to exercise more care and use a more stringent materiality criterion. True False18.Auditors usually choose separate measures of materiality for each of the financial statements. True False19.Auditors usually prepare an audit plan summarizing the preliminary analytical review and the materiality assessment. True False20.Auditors use two kinds of audit plans, one for obtaining evidence about control risk, and the other for obtaining evidence about dollar amounts and disclosures. True False21.Audit procedures are intended to enable auditors to conduct work in accordance with the three performance principle. True False22.Scanning is an "eyes-open" approach of looking for anything unusual in the accounts. True False23.Audit plans are used as audit planning tools.
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