Why are substantive procedures required in both a purely substantive audit

Why are substantive procedures required in both a

This preview shows page 29 - 33 out of 60 pages.

Question 1Why are substantive procedures required in both a purely substantive audit approach and a combined audit approach? a) Control testing alone does not sufficiently address the risk of material misstatement.b) Tests of controls alone are too costly.c) It is more effective to audit a large number of transactions using substantive procedures.d) Substantive procedures can be performed after year end. Vie w Feedback Question 2In which of the following situations would a practitioner use a purely substantive approach instead of a combined approach when planning the audit? Vie w
Image of page 29
Feedback Question 3Which of the following options supports a practitioner using a combined approach instead of a purely substantive approach when planning the audit? Vie w Feedback Question 4Audit, inherent, and control risk are all assessed as low; detection risk is assessed as high. Therefore, which of the following statements is true? Question 1Bartle and Nibson LLP (BN) accepted the audit engagement of Austin Design Ltd. (Austin) fromone of its competitors: Austin indicated it chose BN after seeing BN’s advertisement in the yellow pages.
Image of page 30
Austin is going public and has agreed to compensate BN for its services at a rate of 1% ofthe funds raised from the public offering.Austin is BN’s largest client. Which of the following represents a breach of the rules of professional conduct regarding BN’s relationship with Austin? w Feedback Question 2Bartle and Nibson LLP (BN) accepted the audit engagement of a new client, Spiroland Ltd.:BN obtained this client after it hired a former associate, Bob Hartigan, from its competitor, Haynes and Able LLP (HA).Bob brought HA’s entire client list with him.BN sent advertising to HA’s client list.Which of the following represents a breach of the rules of professional conduct regarding BN’s relationship with Spiroland?
Image of page 31
Vie w Feedback
Image of page 32
Image of page 33

You've reached the end of your free preview.

Want to read all 60 pages?

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture