This quiz works best with JavaScript enabled. Home > Finance > Accounting > Auditing > Auditing – Quiz 3 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Auditing Quiz 3 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Audit risk is..... A) The susceptibility of an account balance or class of transactions to a material misstatement, assuming that there are no related internal control policies and procedures. B) The risk of material misstatement in an assertion that cannot be prevented or detected in a timely manner by the entity's internal control. C) Risk resulting from the auditor not being able to detect material misstatements contained in an assertion. D) The risk that occurs if the auditor, without realizing it, does not communicate his opinion as appropriate, on a financial report that contains material misstatement. Show Answer Correct Answer: D) The risk that occurs if the auditor, without realizing it, does not communicate his opinion as appropriate, on a financial report that contains material misstatement. 2. External auditor considered reliance on internal auditor based on the evaluation of effectiveness of audit conduct by internal auditor if A) Independence of the audit team have been evaluated. B) Competency and skills needed are achieved. C) Recommendation from client point of view accepted. D) Relevant audit tests of the internal controls and financial statement have been performed. Show Answer Correct Answer: C) Recommendation from client point of view accepted. 3. ..... Audit is done by a third party and provides an independent view A) Internal. B) External. C) Environmental. D) None. Show Answer Correct Answer: B) External. 4. Before the work of audit commenced, the auditor should plans out the whole of audit work is called A) Audit programme. B) Audit note. C) Audit risk. D) Audit plan. Show Answer Correct Answer: A) Audit programme. 5. In an examination, is the examiner's recommendation not a necessity? A) Compliance Check. B) Audit. C) Performance Check. D) Investigative Examination. Show Answer Correct Answer: D) Investigative Examination. 6. Which one of the following is not a principle of Internal Control? A) Competent and Trustworthy Personnel. B) Segregation of duties. C) Sound practices. D) Unsound Mind. Show Answer Correct Answer: D) Unsound Mind. 7. Auditor can be held liable for any misstatements in A) Audit certificate. B) Audit report. C) Nonr. D) None of above. Show Answer Correct Answer: A) Audit certificate. 8. The first auditor of the company other than govt company is appointed by BOD within ..... of its incorporation A) 10 days. B) 30 days. C) 40 days. D) 20 days. Show Answer Correct Answer: B) 30 days. 9. A ..... is a systematic capturing of how a client behaves in a given set of contexts and situations A) Behavioural Audit. B) Procedural Audit. C) Operational Audit. D) All. Show Answer Correct Answer: A) Behavioural Audit. 10. Internal auditor is appointed by ..... A) Management. B) Shareholders. C) Government. D) None of above. Show Answer Correct Answer: A) Management. 11. The source of information that can be used for Auditing are Internal and external A) True. B) False. Show Answer Correct Answer: A) True. 12. The sequence of steps in gathering audit evidence as the basis for the auditor's opinion is ..... A) Tests of controls, determination of control risk and substantive tests. B) Control risk assessment, tests of controls and substantive tests. C) Substantive tests, control risk assessments and tests of controls. D) Control risk assessment, Substantive tests, and Tests of controls. Show Answer Correct Answer: B) Control risk assessment, tests of controls and substantive tests. 13. When the directors of company should appoint an auditor? A) During Emergency General Meeting. B) Every Annual General Meeting. C) Before First Annual General Meeting. D) After Board of Directors Meeting. Show Answer Correct Answer: C) Before First Annual General Meeting. 14. Audit report along with annual accounts is given by A) Statutory Auditor. B) Government Auditor. C) Internal Auditor. D) Secretarial Auditor. Show Answer Correct Answer: A) Statutory Auditor. 15. Erroneous data has been detected by computer program controls. It has been excluded from processing and printed separately "Error Report" . Who should most probability by review and follow up on this report? A) System, analyst. B) Programmer. C) Computer operator. D) Data control group. Show Answer Correct Answer: A) System, analyst. 16. What is a Bin card? A) A register containing all cash transactions. B) A software used in Auditing. C) Printed cards used for accounting for the stock of material, in stores. D) All of the above. Show Answer Correct Answer: C) Printed cards used for accounting for the stock of material, in stores. 17. ..... is the evidence to check whether it adequately covers the hazards in the organization A) Interviews. B) Documentation. C) Observation. D) None. Show Answer Correct Answer: B) Documentation. 18. Casual vacancy can be filled by A) Board of directors. B) Managing directors. C) Central government. D) Company secretary. Show Answer Correct Answer: A) Board of directors. 19. The internal auditor's independence is most likely to be compromised when the internal audit department is responsible directly to audit committee of the board of directors. A) TRUE. B) FALSE. Show Answer Correct Answer: A) TRUE. 20. An audit report is any information that supports the figures or other information presented in a financial report, which can be used by the auditor as a reasonable basis for expressing an opinion. A) CORRECT. B) SALAH. Show Answer Correct Answer: B) SALAH. 21. Investigation is an examination of ..... A) Books of accounts. B) Trial balance. C) Final account. D) All of these. Show Answer Correct Answer: D) All of these. 22. Subsidiary object of auditing is A) Detection of errors. B) Prevention of errors. C) Detection and prevention of errors and fraud. D) All of the Above. Show Answer Correct Answer: D) All of the Above. 23. The auditor's main notes regarding the audit work that has been carried out which can contain audit procedures, tests carried out, various evidence and information obtained during the audit, and the conclusions reached by the auditor in carrying out the audit constitute a..... A) Physical evidence. B) Working papers. C) Audit evidence. D) External documents. Show Answer Correct Answer: B) Working papers. 24. The following are the objectives and contents of the audit working papers, except: A) Assists in planning and executing tasks. B) Indicates whether the goal of the task has been achieved. C) Contribute to the professional development of internal audit staff. D) Obtain privileged access rights to relevant data. Show Answer Correct Answer: D) Obtain privileged access rights to relevant data. 25. 'Audit in Depth' means A) Audit of each and every item. B) Intensive audit of each and every item. C) Intensive audit of a few items. D) Audit of a few selected items. Show Answer Correct Answer: C) Intensive audit of a few items. 26. Routine checking and vouching are the same A) True. B) False. Show Answer Correct Answer: B) False. 27. Fixed asset sales transactions have been recorded in the 2022 accounting period, and not in the 2021 period. This is one application of the assertion..... A) Pisah batas (cut-off). B) Keakurasian (accuracy). C) Classification. D) Presentation. Show Answer Correct Answer: A) Pisah batas (cut-off). 28. Which auditing standard requires auditors to gather information to understand their clients' internal controls? A) Second field work standard. B) First general standard. C) Third field work standard. D) First reporting standard. Show Answer Correct Answer: A) Second field work standard. 29. Audit planning..... A) Preliminary survey, client acceptance, signing engagement letter, audit risk analysis, preparation of audit program. B) Preliminary survey, client acceptance, signing of engagement letter, Audit Phase for current year, preparation of audit program. C) Preliminary survey, client acceptance, signing engagement letter, reporting audit results. D) Preliminary survey, client acceptance, signing of engagement letter, year-end audit stage. Show Answer Correct Answer: A) Preliminary survey, client acceptance, signing engagement letter, audit risk analysis, preparation of audit program. 30. During an audit of a company's cash balance on a company with operations in only one country, the auditor is most concerned with which management assertion A) Existence. B) Rights and obligations. C) Valuation or allocation. D) Occurrence. Show Answer Correct Answer: A) Existence. ← PreviousNext →Related QuizzesAccounting QuizzesFinance QuizzesAuditing Quiz 1Auditing Quiz 2Auditing Quiz 4Auditing Quiz 5Auditing Quiz 6Auditing Quiz 7Auditing Quiz 8Auditing Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books