This quiz works best with JavaScript enabled. Home > Accounting > Auditing > Auditing – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Auditing Quiz 1 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Any of the following is not a reasonable condition that would support the need for an independent audit of the financial statements: A) Conflict of interest between management and the CPA. B) Complexity of financial reports. C) Remoteness of users of financial statements from accounting records. D) Consequences of financial statements in the user decision process. Show Answer Correct Answer: A) Conflict of interest between management and the CPA. 2. What is SQCS? A) A practice that performs audit, attestation, compilation, review, and other services. B) A way to put your butter on your bread. C) Tips for Human Resources. D) Acceptance and continuance of client relationships and specific engagements. Show Answer Correct Answer: A) A practice that performs audit, attestation, compilation, review, and other services. 3. Which of the following is the correct flow of audit process? A) Understand the entity, planning, tests of control, preliminary engagement, establish materiality, evaluate results, complete the audit. B) Preliminary engagement, understanding the entity, establish materiality, planning, test of control, complete the audit, evaluate results. C) Understand the entity, preliminary engagement, planning, establish materiality, tests of control, evaluate results, complete the audit. D) Preliminary engagement, planning, establish materialitiy, tests of control, evaluate results, complete the audit. Show Answer Correct Answer: B) Preliminary engagement, understanding the entity, establish materiality, planning, test of control, complete the audit, evaluate results. 4. An audit programme is a set of ..... which are to be followed for proper execution of audit. A) Rules. B) Policies. C) Instructions. D) None of above. Show Answer Correct Answer: C) Instructions. 5. Transactions related to/related to fixed assets (which ones have normal balances in credit) A) Acquisition, Withdrawal of capital. B) Revaluation, Exchange. C) Termination of use, Sales. D) Accumulated Depreciation of fixed assets, sales. Show Answer Correct Answer: D) Accumulated Depreciation of fixed assets, sales. 6. Chartered Accountants Act was passed in the year A) 1939. B) 1956. C) 1949. D) 1959. Show Answer Correct Answer: C) 1949. 7. Independence in carrying out audits includes: A) Independence in creating audit programs. B) Independence in investigations. C) Independence in reporting. D) All True. Show Answer Correct Answer: D) All True. 8. External audit will be responsible for: A) Shareholders. B) Manajer accounting. C) Tax Manager. D) Board of Directors. Show Answer Correct Answer: A) Shareholders. 9. Examination of client documents and records to support information that should be recorded in financial statements is the definition of..... A) Inspection. B) Confirmation. C) Observation. D) Investigation. Show Answer Correct Answer: A) Inspection. 10. Fraud in financial statements can involve actions such as those presented below. TRUE is..... A) Manipulation, falsification, or alteration of accounting records or supporting documents that become data sources for other companies. B) Manipulation, falsification, or changes in accounting records or supporting documents which are data sources for the presentation of financial reports. C) Correct representation or omission in financial statements of significant events, transactions or information. D) The correctness of the deliberate application of accounting principles relating to amounts, classification, method of presentation or disclosure. Show Answer Correct Answer: B) Manipulation, falsification, or changes in accounting records or supporting documents which are data sources for the presentation of financial reports. 11. The following are the objectives of an audit except..... A) Accounting data can be trusted. B) Maintaining Security of Company Assets. C) Securing Operational Costs. D) Running operational activities effectively and efficiently. Show Answer Correct Answer: C) Securing Operational Costs. 12. Audiutibb A) A. B) D. C) V. D) E. Show Answer Correct Answer: B) D. 13. Auditing is luxury for A) Joint stock company. B) Partnership. C) Small shop keepers. D) Government company. Show Answer Correct Answer: C) Small shop keepers. 14. The following is a person disqualified from becoming an auditor of a company except A) He owes the company a sum of RM28, 000. B) He is an undischarged bankrupt. C) He was an officer of the company in the past 2 years prior the appointment. D) Has been convicted of any offense involving fraud or dishonesty. Show Answer Correct Answer: C) He was an officer of the company in the past 2 years prior the appointment. 15. Which of the following factors is most important in determining the appropriations of auditevidence? A) The reliability of audit evidence and its relevance in meeting the audit objective. B) The objectivity and integrity of the auditor. C) The quantity of audit evidence. D) The independence of the source of evidence. Show Answer Correct Answer: A) The reliability of audit evidence and its relevance in meeting the audit objective. 16. Which are not included in the classification of management assertions are: A) Existence and occurrence. B) Equipment. C) Rights and obligations. D) Effectiveness of performance measurement systems. Show Answer Correct Answer: D) Effectiveness of performance measurement systems. 17. In carrying out the audit and preparing the report, the auditor is obliged to use his professional skills carefully and thoroughly, which is one of the statements in the standard..... A) The. One one. B) B. Field work. C) C. Reporting. D) D. Attestation. Show Answer Correct Answer: A) The. One one. 18. What are the causes of information risk? A) The big gap between the users and supplier of information andadjustment of information which may benefit the supplier. B) The great volume of information. C) The increased complexity of information and economic activities. D) Incorrect treatment of information. E) All of above answers. Show Answer Correct Answer: E) All of above answers. 19. By observing, testing and assessing, an auditor examines the system of A) Internal Audit. B) Internal Control. C) Continuous Audit. D) Statutory Audit. Show Answer Correct Answer: B) Internal Control. 20. What are the types of audits? A) Operational audits, private company audits, public company audits, financial report audits. B) Compliance audit, operational audit, financial report audit, management audit. C) Information audit, financial report audit, management audit, internal control system audit. D) Operational audit, compliance audit, financial report audit, internal control system audit. Show Answer Correct Answer: D) Operational audit, compliance audit, financial report audit, internal control system audit. Next →Related QuizzesAccounting QuizzesAuditing Quiz 2Auditing Quiz 3Auditing Quiz 4Auditing Quiz 5Auditing Quiz 6Auditing Quiz 7Auditing Quiz 8Auditing Quiz 9Auditing Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books