B A test of control. C A substantive test of transactions. D Both a test of control and a substantive test of transactions. 2 An auditor’s decision either to apply analytical procedures as substantive tests or to per - form substantive tests of transactions and account balances usually is determined by the A Availability of data aggregated at a high level. B Relative effectiveness and efficiency of the tests. C Timing of tests performed after the balance sheet date. D Auditor’s familiarity with industry trends. 3 The auditor faces a risk that the audit will not detect material misstatements that occur in the accounting process. To minimize this risk, the auditor relies primarily on A Substantive tests. B Test of controls. C Internal control. D Statistical analysis. 4 A conceptually logical approach t o the auditor’s evaluation of internal control consists of the following four steps:- I. Determining the internal controls that should prevent or detect errors and fraud. II. Identifying control deficiencies to determine their effect on the nature, timing, or extent of auditing procedures to be applied and suggestions to be made to the client. III. Determining whether the necessary internal control procedures are prescribed and are being followed satisfactorily. IV. Considering the types of errors and fraud that can occur. What should be the order in which these four steps are performed? A I, II, III, and IV. B I, III, IV, and II. C III, IV, I, and II. D IV, I, III, and II. 1) B 2) B 3) A 4) D
( ) Mr.Ahmed Atef Khafaga 5 Which of the following statements about tests of controls is most accurate? A Auditing procedures cannot concurrently provide both evidence of the effectiveness of internal control procedures and evidence required for substantive tests. B Tests of controls include observations of the proper segregation of duties. C Tests of controls provide direct evidence about monetary misstatements in transactions. D Tests of controls ordinarily should be performed as of the balance sheet date or during the period subsequent to that date. 6 To support the auditor’s initial assess ment of control risk below maximum, the auditor performs procedures to determine that internal controls are operating effectively. Which of the following audit procedures is the auditor performing? A Tests of details of balances. B Substantive tests of transactions. C Tests of controls. D Tests of trends and ratios. 7 The primary objective of performing tests of controls is to obtain A A reasonable degree of assurance that the client’s internal c ontrols are operating effectively on a consistent basis throughout the year. B Sufficient, appropriate audit evidence to afford a reasonable basis for the auditor’s opinion, without the need for additional evidence.
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- Fall '16
- taher refaat
- Accounting, Auditor's report, Atef Khafaga