This quiz works best with JavaScript enabled. Home > Finance > Accounting > Auditing > Auditing – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Auditing Quiz 5 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. How can we remember the 6 elements of Quality Control? A) SAVE US. B) HELP ME. C) HEAL ME. D) None of the above. Show Answer Correct Answer: C) HEAL ME. 2. "Auditor is a watch dog and not a blood hound" decision was given in the case of A) London and General Bank 1895. B) Kingston Cotton Mills Ltd 1896. C) Irish woolen Company Vs. Tyson and others. D) None of these. Show Answer Correct Answer: B) Kingston Cotton Mills Ltd 1896. 3. The value at which the assets are shown in the books of accounts is known as ..... A) Replacement value. B) Cost value. C) Book value. D) Market value. Show Answer Correct Answer: C) Book value. 4. How many types of audit opinions are there? A) 4. B) 3. C) 2. D) 5. Show Answer Correct Answer: A) 4. 5. Following are the types of management audit except A) Audit of financial statements. B) Audit internal. C) Management audit. D) Compliance audit. Show Answer Correct Answer: C) Management audit. 6. WHICH OF THE FOLLOWING IS NOT THE RIGHT OF A AUDITOR A) To inspect branch accounts. B) To sign audit reports. C) To seek legal and technical advice. D) To give instructions to accounts officer. Show Answer Correct Answer: D) To give instructions to accounts officer. 7. The following are elements of internal control, except..... A) Control environment. B) Risk assessment. C) Effectiveness and efficiency of operations. D) Control activities. Show Answer Correct Answer: C) Effectiveness and efficiency of operations. 8. The following are example of advisory services offer by public accounting firmsEXCEPT A) Designing financial information system. B) Providing bookkeeping of the accounting records. C) Audit financial statements. D) Providing internal audit services. Show Answer Correct Answer: C) Audit financial statements. 9. Reducing detailed testing is the planning stage of analytical procedures with the aim of..... A) Main. B) Seconds. Show Answer Correct Answer: B) Seconds. 10. Independent audits help communicate economic data, because audits: A) Ensure readers of financial reports that any fraudulent activity has been corrected. B) Increase the reliability of financial reports. C) Ensure that financial data is presented fairly. D) Confirm the accuracy of management's financial presentation. Show Answer Correct Answer: C) Ensure that financial data is presented fairly. 11. The existence of audit risk can be identified from the statement in the auditor's standard report that: A) Obtain reasonable assurance about whether the financial statements are free from material misstatement. B) Assess the accounting principles used while evaluating the presentation of the financial statements as a whole. C) Recognize that some problems, individually or collectively, are important, while other problems are not important. D) Responsible for expressing opinions on financial reports, which are the responsibility of management. Show Answer Correct Answer: D) Responsible for expressing opinions on financial reports, which are the responsibility of management. 12. If during the audit process it is found that items in the financial statements contain material misstatements and are not in accordance with standards, then the auditor has the right to issue an opinion in the form of: A) WDP. B) Unreasonable. C) WTP. D) Not Giving Opinions. Show Answer Correct Answer: B) Unreasonable. 13. Work must be planned as well as possible and if assistants are used they must be supervised properly, is one of the statements of the standard..... A) D. Attestation. B) B. Field work. C) C. Reporting. D) The. One one. Show Answer Correct Answer: B) B. Field work. 14. The process of compiling findings (negative findings) includes the following steps, except..... A) The activity of compiling findings must be broad enough, so that examiners can be clear about the basis for their conclusions and recommendations. B) Identify the boundaries of authority and responsibility within the organization in relation to the activities involved. C) Determine the reasons for the deficiency or weakness. D) Identify deviations/weaknesses of activities/parts. Show Answer Correct Answer: A) The activity of compiling findings must be broad enough, so that examiners can be clear about the basis for their conclusions and recommendations. 15. While planning an internal audit, the internal auditor obtains knowledge about the auditee to, among other things: A) Develop an attitude of professional skepticism about management's assertions. B) Develop an understanding of the auditee's objectives and risks. C) Make constructive suggestions to management concerning internal control improvements. D) Evaluate whether misstatements in the auditee's performance reports should be communicated to senior management and the audit committee. Show Answer Correct Answer: B) Develop an understanding of the auditee's objectives and risks. 16. What is the basic difference between the accounting process and the auditing process? A) The accounting process is sequential starting from proof of transactions to financial reports and the auditing process is carried out sequentially starting from proof of transactions to financial reports. B) The accounting process is sequential starting from proof of transactions to financial reports, while the auditing process can be done in two directions. C) The accounting process can be carried out in two directions, while the auditing process is carried out sequentially. D) The accounting process can be carried out in two directions and the auditing process can be carried out in two directions. Show Answer Correct Answer: B) The accounting process is sequential starting from proof of transactions to financial reports, while the auditing process can be done in two directions. 17. Auditor qualifications A) Audit fees. B) Integrity. Show Answer Correct Answer: B) Integrity. 18. An examination and evaluation of a firm's or individual's financial records to derive evidence that can be used in a court of law or legal proceeding is referred to as ..... A) Forensic audit. B) Compliance audit. Show Answer Correct Answer: A) Forensic audit. 19. The main requirements for an audit report with an Unqualified Audit Report opinion according to Arens, are as follows except..... A) All balance sheets, profit and loss, retained earnings and cash flow reports are included in the audited financial statements. B) Three general standards have been followed in each assignment. C) There are additional explanatory paragraphs and wording modifications in the audit report. D) Financial reports are presented in accordance with generally accepted accounting standards. Show Answer Correct Answer: C) There are additional explanatory paragraphs and wording modifications in the audit report. 20. Continuous data used by auditors..... A) Client archives. B) Arsiip auditor. C) Permanent archive. D) Current year archive. Show Answer Correct Answer: C) Permanent archive. 21. What are the standards for the public accounting profession in Indonesia? A) AICPA. B) SPAP. C) THING. D) PCAOB. Show Answer Correct Answer: B) SPAP. 22. Which of the following is a limitation of the internal audit function? A) Internal audit assignments are designed to meet the needs of the business. B) Internal auditors may be employees of the company. C) The internal audit report is not circulated to the members. D) Internal auditors may report to an audit committee. Show Answer Correct Answer: B) Internal auditors may be employees of the company. 23. SA 300 deals with A) Materiality. B) Audit planning. C) Audit Program. D) Working Papers. Show Answer Correct Answer: B) Audit planning. 24. When should the Audit Committee make its report to the Court? A) July and October. B) June and November. C) May and October. D) June and December. Show Answer Correct Answer: D) June and December. 25. Providing assurance that the reports prepared by the entity are presented fairly and in accordance with established accounting standards is the function of: A) Finance Manager. B) Management Accountant. C) Independent Auditor. D) Accounting information system. Show Answer Correct Answer: C) Independent Auditor. 26. Who is ultimately responsible for a company's system of internal controls? A) Audit committee. B) Board of directors. C) External auditors. D) Internal auditors. Show Answer Correct Answer: B) Board of directors. 27. Contingent means..... A) Efficient. B) Vital. C) Dependent. D) Nonprofit. Show Answer Correct Answer: C) Dependent. 28. Control 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) Risk occurs if the auditor, without realizing it, does not modify his opinion as appropriate, on a financial report that contains a material misstatement. Show Answer Correct Answer: 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. 29. What is the need for IT security? A) To stop validation. B) To do auditing. C) The need to protect your digital assets and network devices is even greater. D) All of them. Show Answer Correct Answer: C) The need to protect your digital assets and network devices is even greater. 30. Report Making is compulsory in ..... A) Accounting. B) Auditing. Show Answer Correct Answer: B) Auditing. ← PreviousNext →Related QuizzesAccounting QuizzesFinance QuizzesAuditing Quiz 1Auditing Quiz 2Auditing Quiz 3Auditing Quiz 4Auditing Quiz 6Auditing Quiz 7Auditing Quiz 8Auditing Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books