34) If an auditor wishes to rely on the work of internal auditors (IA), the auditor must obtain satisfactory evidence related to the IA's competence, integrity, and objectivity. A) TrueB) FalseAnswer: ATerms: Internal auditorsDiff: ModerateObjective: LO 10-3AACSB: Reflective thinking skills21
Learning Objective 10-4 1) When the auditor attempts to understand the operation of the accounting system by tracing a few transactions through the accounting system, the auditor is said to be: 2) The purpose of phase 3 in the "process for understanding internal control and assessing control risk" is to: 3) Narratives, flowcharts, and internal control questionnaires are three common methods of: 4) When dealing with the documentation of internal control: A) in a narrative, most questions simply require a "yes" or "no" response.B) questionnaires offer useful checklists to remind the auditor of the many different types of internal controls that should exist.C) questionnaires and flowcharts should not be used together.D) flowcharts fail to show the segregation of duties in the company.Answer: BTerms: Internal controlDiff: ModerateObjective: LO 10-4AACSB: Reflective thinking skills 22
5) Audit evidence regarding the separation of duties is normally best obtained by: 6) Walkthroughs combine observation, inspection, and inquiry to assure that the controls designed by management have been implemented.A) TrueB) FalseAnswer: ATerms: Walkthroughs; understanding internal controlDiff: EasyObjective: LO 10-4AACSB: Reflective thinking skillsTopic: Public 7) A narrative should describe the disposition of every document and record in the system.
You've reached the end of your free preview.
Want to read all 40 pages?
- Winter '15