Lecture 1 – Chapter 1 all

Rights a honest b integrity c audacity

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Unformatted text preview: 5. The appointment of the independent auditor is governed by: a) CPA Australia b) ICAA c) Corporations Act 2001 d) Australian Securities Exchange Q 6. When an auditor resigns or is removed a copy of the notice of that resignation or removal must be: a) Lodged with the ASIC b) Lodged with the ACCC c) Lodged with CPA Australia and the ICAA d) Lodged with the ASIC and the ACCC Q 7. An auditor is under a statutory duty to report to: a) The members on the company’s financial statements for an accounting period and on the accounting records relating to those financial statements b) The directors on the company’s financial statements for an accounting period and on the accounting records relating to those financial statements c) To ASIC on the company’s financial statements for an accounting period and on the accounting records relating to those financial statements d) a. and c. Q 8. One of a number of benefits which arises as the result of having an audit of corporation’s financial statements is: a) Absolute assurance to the shareholders of a corporation that the financial statements are free of material errors b) A higher likelihood that the audited corporation can obtain capital on more favorable terms c) That an audit report gives an unquestionable early warning sign to investors of company failure d) That the auditors will detect and report to shareholders any fraud or illegal acts Q 9 . the true statement is: a) An auditor may be removed from office only at the Annual General Meeting of which 30 days notice of the meeting is given b) ASIC must give consent for the auditors to resign from the audit of a company other than a proprietary company c) Statements made by the auditor in relation to his or her resignation are admissible in evidence in any legal proceedings and may be used against the auditor d) All of the statements are true Q 10. The product of an audit is usually a communication to management in the form of a letter that is often described as a ‘management letter’. The management letter usually contains recommendations for: a) Reducing the size of the audit b) Evidence that can be gathered by the company’s internal auditors so that the audit fee can be reduced c) I...
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This document was uploaded on 09/17/2013.

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