7. Analytical procedures:A. are not a type of audit evidence.B. are not required during the completion phase of the audit.C. performed during the planning phase of the audit are used as a substantive test insupport of account balances.D. do not provide reliable evidence unless it is corroborated with other evidence.8. Reasonable assurance allows for:A. low likelihood that material misstatements will not be prevented or detected byinternal controls.B. no likelihood that material misstatements will not be prevented or detected by internalcontrols.C. moderate likelihood that material misstatements will not be prevented or detected byinternal controls.D. high likelihood that material misstatements will not be prevented or detccted byinternal controls.9. Management implements internal controls to ensure that all required footnote disclosuresare accurate. Auditors tests those controls to provide evidence supporting thepresentation.A. completeness and valuationB. completeness and accuracyC. rights and obligations and existenceD. occurrence and accuracy10. "Independence" in auditing means:A. maintaining an indirect financial interest.B. not being financially dependent on a client.C. taking an unbiased viewpoint.D. being an advocate for a client.11. The trait that distinguishes auditors from accountants is the:A. auditor's ability to interpret generally accepted accounting principles.B. auditor's education beyond the Bachelor's degree.C. auditor's ability to interpret HKFRS Statements.D. auditor's accumulation and interpretation of evidence related to a company's financialstatements.12. Which of the following services provides higher level of assurance on a financialstatement?A. A reviewB. An auditC. Neither service provides assurance on financial statements.D. Each service provides the same level of assurance on financial statements.

Hi student Since there are multiple questions,we will answer only first question. If you want…

7. Analytical procedures: A. are not a type of audit evidence. B. are not required during the completion phase of the audit. C. performed during the planning phase of the audit are used as a substantive test in support of account balances. D. do not provide reliable evidence unless it is corroborated with other evidence.

7. Analytical procedures: A. are not a type of audit evidence. B. are not required during the completion phase of the audit. C. performed during the planning phase of the audit are used as a substantive test in support of account balances. D. do not provide reliable evidence unless it is corroborated with other evidence.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: The auditor may add an explanatory paragraph to the unqualified audit report in the following…

A: GAAP - It is termed as Generally accepted accounting principle. It is basically an accounting…

Q: What level of assurance will be provided by an auditor in a review engagement service? a. None of…

A: Answer: Review engagement services are those services which are conducted aside of audit in…

Q: whether there is a reasonable possibility that the company's internal control system will fail to…

A: Internal control is the managements’ effective and efficient controls for achieving goals and…

Q: The risk that the auditors will conclude, based on substantive procedures, that a material…

A: The risk you are referring to is known as the risk of substantive procedures not detecting a…

Q: As auditors expect certain accounts to have more misstatements than others, both overstatements and…

A: Answer:- Auditing:- In order to confirm that a process or quality system is operating in accordance…

Q: Auditors of financial statements are designed to obtain reasonable assurance of detecting material…

A: The auditor is required to obtain reasonable assurance that financial statements aa a whole are free…

Q: (A) The requirement is to find the best statement concerning an auditor’s assessment of…

A: Control risk alludes to the probability that a large misrepresentation originating from a caused by…

Q: i need the answer quickly

A: Analyzing the optionsa) Confirm more accounts receivable than earlier planned: This option would not…

Q: 1. What is the primary reason that auditors’ assess internal control? a)To determine the risk of…

A: Internal Control:It is a process that is being effected by an entity's board of directors,…

Q: Why might an auditor issue a disclaimer of opinion after an audit? A. All of these may cause an…

A: Disclaimer of opinion: The disclaimer of opinion is the opinion given by the auditor on the…

Q: Which of the following is least likely to be a factor that might indicate to an auditor that an…

A: special considerations are used by auditors where there is a high risk of material misstatements in…

Q: S1: The subsequent events period extends to the date of management representation letter and the…

A: To make sure that financial information is presented fairly and properly in compliance with the…

Q: Which analytical procedures are most important in verifying notes payable? Which types of…

A: It refers to the evaluation of financial information via identifying and analyzing of plausible…

Q: Analytical procedures are not used at the planning of the audit, during the audit and at the…

A: Analytical procedures in audit are used at all the three stages i.e Planning of the audit, execution…

Q: The auditor is typically concerned with two major types of mistakes that materially impact the…

A: Option A) Risk of Assessing Control Risk Too Low/Risk of Incorrect Rejection is incorrect because…

Question

7. Analytical procedures:
A. are not a type of audit evidence.
B. are not required during the completion phase of the audit.
C. performed during the planning phase of the audit are used as a substantive test in
support of account balances.
D. do not provide reliable evidence unless it is corroborated with other evidence.
8. Reasonable assurance allows for:
A. low likelihood that material misstatements will not be prevented or detected by
internal controls.
B. no likelihood that material misstatements will not be prevented or detected by internal
controls.
C. moderate likelihood that material misstatements will not be prevented or detected by
internal controls.
D. high likelihood that material misstatements will not be prevented or detccted by
internal controls.
9. Management implements internal controls to ensure that all required footnote disclosures
are accurate. Auditors tests those controls to provide evidence supporting the
presentation.
A. completeness and valuation
B. completeness and accuracy
C. rights and obligations and existence
D. occurrence and accuracy
10. "Independence" in auditing means:
A. maintaining an indirect financial interest.
B. not being financially dependent on a client.
C. taking an unbiased viewpoint.
D. being an advocate for a client.
11. The trait that distinguishes auditors from accountants is the:
A. auditor's ability to interpret generally accepted accounting principles.
B. auditor's education beyond the Bachelor's degree.
C. auditor's ability to interpret HKFRS Statements.
D. auditor's accumulation and interpretation of evidence related to a company's financial
statements.
12. Which of the following services provides higher level of assurance on a financial
statement?
A. A review
B. An audit
C. Neither service provides assurance on financial statements.
D. Each service provides the same level of assurance on financial statements.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Applying substantive tests to the details of asset and liability accounts as of an interim date, rather than as the balance sheet date: Eliminates the use of certain statistical sampling methods that would otherwise be available, Presumes that the auditor will reperform the tests as of the balance sheet date, Should be especially considered when there are rapidly changing economic conditions, Potentially increases the risk that errors which exist at the balance sheet date will not be detected
Audit evidence obtained through inquiry of management about proper segregation of custodianship and recordkeeping functions is less reliable than evidence acquired through the auditor's personal observation. TRUE OR FALSE? WHY?
STATEMENT 1: Significant unexpected fluctuations identified by analytical review procedures will usually necessitate a review of internal control. STATEMENT 2: Working papers should generally contain the nature and extent of audit procedures done, the results of any testing, and the CPA's conclusion about how the findings will affect his report. A. Only Statement 1 is incorrect B. Only Statement 1 is correct C. Both statements are incorrect D. Both statements are correct
1. S1: The concept of materiality would be very important to an auditor in determining transactions that should be validated. S2: The level of assurance expected to be issued affects the amount of procedures to be performed by the practitioner. Group of answer choices Both S1 and S2 are incorrect. Only S2 is correct. Both S1 and S2 are correct. Only S1 is correct. 2. S1: Analytical procedures used as substantive test focuses on detecting material misstatements. S2: The responsible party always prepare a representation that will be subjected to the validation of the practitioner. Group of answer choices Only S1 is correct. Both S1 and S2 are incorrect. Both S1 and S2 are correct. Only S2 is correct. 3. S1: After conducting an audit and release of the audit report, the primary responsibility on the fairness of the financial statements remains with the management and those charged with governance of the entity. S2: In recurring audits, the auditor may not send a new…
The Auditor prepares a disclaimer of opinion: a. When he cannot find any misstatement in the report. b. When the financial statements are not following GAAP. c. When he finds some discrepancy in the treatment of some items. d. When he is not able to obtain sufficient appropriate audit evidences about an issue.
The requirement for an attitude of scepticism means that the auditor should A) perform additional tests of controls to increase the probability of discovering fraud or errors. B) plan and conduct the audit with an attitude of distrust in management. C) not be blind to evidence that suggests the documents, books, or records have been altered or are incorrect. D) not consider management's explanation as evidence on any subject
23. Analytical procedures used to form an overall audit conclusion generally include A. Considering unusual or unexpected account balances that were not previously identified. B. Performing tests of transactions to corroborate management's financial statement assertions. C. Gathering evidence concerning account balances that have not changed from the prior year. D. Retesting controls that appeared to be ineffective during the assessment of control risk.