auditing mcqs

Verification

Vouching

Testing

Auditing

the timing of the audit

last year’s audit

the potential use of internal audit

whether corrections from the inventory count have been implemented

Duty to report to the members

Duty to sign the audit report

Duty to report to the company’s bankers

Duty to report on any violation of law

Considering whether the financial statements show a true and fair view

Previous year’s audit i.e. any qualifications in the report

Background i.e. industry

Considering the work to be done by the client staff e.g. internal audit

Disproportionately

Inversely

Randomly

Directly

For a period auditor opines them to be useful in servicing the client

For the time period the entity remains a client of the audit firm.

For the period the audit firm is in existence.

For a period of ten years

Expression of opinion

Detection and Prevention of fraud and error

Both (A) and (B)

Depends on the type of audit.

Until the financial statements are complete

Until the directors remove them

Until the audit is complete

Until the next AGM (Annual General Meeting)

Teeming and lading

Hacking

Looping

Embezzlement

Estimates of the total likely misstatement cannot be made

Estimates of the total likely misstatement is less than materiality level

Amount of known misstatement is documented in working papers

Estimate of the total likely misstatement is more than materially level

International Accounting Standards Board

International Standards Board

International Federation of Accountants

Auditing Practices Board

Supervisor of the staff

Staff specially appointed for the purpose

Internal auditor

Members of the staff

Statutorily appointed auditor

By independent auditor

By a government auditor

By a person appointed by the management

1949

1961

1972

1956

the company’s creditors (payables)

the shareholders

the company’s bank

the directors

Statutory audit

Detailed audit

Continuous audit

Annual audit

annual general meeting

General meeting

Board meeting

extraordinary general meeting

34

32

36

38

None of the above

Be included in the stock

Not be included in the stock

Not be checked by auditor

Error of duplication

Error of commission

Error of principle

Error of omission

Attest to the credibility of the company’s accounts

Protect the interests of the minority shareholders

Assess the effectiveness of the company’s performance

Detect and prevent errors and fraud

one accountancy firm should review the IFI and a different firm should audit the financial statements for the year as a whole.

one audit firm should audit the IFI and a different firm should audit the financial statements for the year as a whole.

the same firm should audit the IFI and the financial statements for the year as a whole.

the same firm should review the IFI and the financial statements for the year as a whole.

Summary of unadjusted errors

Audit planning memorandum

Details of the work done on the inventory count

Memorandum & articles of association

Evidence obtained from outside sources routed through the client

Effective internal control system provides reliable audit evidence

To be reliable, evidence should conclusive rather than persuasive

All are correct.

They should not contain details regarding weaknesses in the internal control system

They help the auditor to monitor the effectiveness of the audit firm’s quality control

They should be considered as the principle support for the auditor’s report

They document the level of independence maintained by the auditor