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d. When documenting their understanding of a client's internal controls, auditors are required to use narratives. e. To issue an unqualified opinion on internal control over financial reporting, there must be no identified material weaknesses and no restrictions on the scope of the audit.

d. When documenting their understanding of a client's internal controls, auditors are required to use narratives. e. To issue an unqualified opinion on internal control over financial reporting, there must be no identified material weaknesses and no restrictions on the scope of the audit.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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KINDLY ANSWER THE TRUE OR FALSE PART NUMBER 4 AND 5. THANK YOU!

A Auditing (2021-2022) 3-B O Microsoft Word - Auditing_Assig x 4 Chapter 3_Auditor's Responsibilit x + O File | C:/Users/Owner/Downloads/Auditing_Assignment%201_092021.pdf Error : M Microsoft Word - Auditing_Assignment 1_To be printed 1 /1|| + | 67% Assignment 1 Auditing and Assurance Principles Instructions: Answer them in your own words. Don't rely too much on copy pasting since our google classroom has a anti-plagiarism function. Good luck! 1. In assessing the probability of fraud, the auditor considers two types. Identify and define these two types of fraud. What is the auditor's responsibility for detecting fraud? (5 pts) 2. Contrast the circumstances in which the auditor would choose not to test controls with those in which he or she would perform tests of controls. (5 pts) 1 3. The internal control framework developed by coso includes five so-called "components" of internal control. Discuss each of these five components. (5 pts) 4. Adequate separation of duties is an important control activity. Discuss the four general guidelines for separation of duties to prevent both intentional and unintentional misstatements that are of significance to auditors. (5 pts) 5. Using your knowledge of the relationships among acceptable audit risk, inherent risk, control risk, planned detection risk, tolerable misstatement, and planned evidence, state the effect on planned evidence (increase or decrease) of changing each of the following factors, while the other factors remain unchanged. (5 pts) 1. An increase in acceptable audit risk. An increase in inherent risk. A decrease in control risk. An increase in planned detection risk. 2. 3. 4. 5. An increase in tolerable misstatement. 6. Discuss how auditors use the audit risk model when planning an audit. (5 pts) 7. True or False (5 pts.) a. If, when obtaining an understanding of control activities of a relatively small client, the auditor identified no control activities, the auditor would probably set a high assessment of control risk. b. When a company designs and implements internal controls, cost of the controls is not a valid consideration. c. Auditing standards prohibit reliance on the work of internal auditors due to the lack of independence of the internal auditors. d. When documenting their understanding of a client's internal controls, auditors are required to use narratives. e. To issue an unqualified opinion on internal control over financial reporting, there must be no identified material weaknesses and no restrictions on the scope of the audit. 09:39 PM Search the web and Windows M 22/09/2021 日
Transcribed Image Text:A Auditing (2021-2022) 3-B O Microsoft Word - Auditing_Assig x 4 Chapter 3_Auditor's Responsibilit x + O File | C:/Users/Owner/Downloads/Auditing_Assignment%201_092021.pdf Error : M Microsoft Word - Auditing_Assignment 1_To be printed 1 /1|| + | 67% Assignment 1 Auditing and Assurance Principles Instructions: Answer them in your own words. Don't rely too much on copy pasting since our google classroom has a anti-plagiarism function. Good luck! 1. In assessing the probability of fraud, the auditor considers two types. Identify and define these two types of fraud. What is the auditor's responsibility for detecting fraud? (5 pts) 2. Contrast the circumstances in which the auditor would choose not to test controls with those in which he or she would perform tests of controls. (5 pts) 1 3. The internal control framework developed by coso includes five so-called "components" of internal control. Discuss each of these five components. (5 pts) 4. Adequate separation of duties is an important control activity. Discuss the four general guidelines for separation of duties to prevent both intentional and unintentional misstatements that are of significance to auditors. (5 pts) 5. Using your knowledge of the relationships among acceptable audit risk, inherent risk, control risk, planned detection risk, tolerable misstatement, and planned evidence, state the effect on planned evidence (increase or decrease) of changing each of the following factors, while the other factors remain unchanged. (5 pts) 1. An increase in acceptable audit risk. An increase in inherent risk. A decrease in control risk. An increase in planned detection risk. 2. 3. 4. 5. An increase in tolerable misstatement. 6. Discuss how auditors use the audit risk model when planning an audit. (5 pts) 7. True or False (5 pts.) a. If, when obtaining an understanding of control activities of a relatively small client, the auditor identified no control activities, the auditor would probably set a high assessment of control risk. b. When a company designs and implements internal controls, cost of the controls is not a valid consideration. c. Auditing standards prohibit reliance on the work of internal auditors due to the lack of independence of the internal auditors. d. When documenting their understanding of a client's internal controls, auditors are required to use narratives. e. To issue an unqualified opinion on internal control over financial reporting, there must be no identified material weaknesses and no restrictions on the scope of the audit. 09:39 PM Search the web and Windows M 22/09/2021 日
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