Lecture 1 – Chapter 1 all

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Unformatted text preview: professional experience an formal education Q 20. The statement that is not correct concerning an audit engagement letter is a) It constitutes a legal contract between the auditor and the client b) A new letter must be prepared each year c) It outlines the responsibilities of management is the audit as well as the responsibilities of the auditor d) All of the statements are correct Q 21. The auditor’s permanent working paper file should not normally include: a) A description of the entity’s internal control structure b) Extracts from the client’s bank statements c) Details of mortgages d) Past year’s financial statements Q 22. ASA 520 requires that auditors apply analytical procedures at the planning stage of an audit: a) To identify material weaknesses in the internal control structure b) To assess the predictability of financial data from individual transactions c) To test the various assertions those are embodied in the financial report d) To obtain a more detailed understanding and to identify areas of potential risk Q 23. Audit memoranda and corroborating information is most likely to include: a) Comments on the performance of auditing procedures b) Lists of adjusting entries c) Analytical review schedules from previous years d) Flow charts on the internal control structure Q 24. A lead schedule is: a) A document used to manage potential clients b) The first schedule for each section of an audit file c) A summary of work that needs to be performed that is held by the audit supervisor d) None of the above Q 25. The form, content and extent of working papers are influenced by: a) The nature of the audit procedures to be performed b) The nature and extent of the exceptions identified c) The audit methodology and the tools used d) All of the above Q 26. An interim audit: a) Take places after the end of the financial period b) Occurs if the auditor is having trouble arranging resources for a full audit c) Normally occurs before the finalization of the audit program Will be undertaken before acceptance of audit engagemen Lecture 4 Chapter 2 Q 1. The conformance aspect of enterprise governance does not cover: a) The role of the chair of the board and top management b) Settling appropriate stra...
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