perform in auditing
Q: COMPANY A COMPANY B Controls are strong Controls are weak If an audit of any of these companies is…
A: What is meant by test controls? It is an audit procedure conducted to ensure the effectiveness of…
Q: With whom should the auditor communicate whenever he or she determines that fraud may be present,…
A: Auditor is the person examining the financial statements and reports of an entity to check if the…
Q: If an IT auditor discover irregular & illegal acts during the course of his audit, what should the…
A: Answer: It is the responsibility of the auditor to report independence opinion on any audit…
Q: When the client’s internal control are good, internal documents are more reliable than external True…
A: The question is related to true or false on Auditing.
Q: high for all financial statements assertions, an auditor should document the auditor’s A B…
A: An Auditor understanding of its environment, it's entity and then assessing the risk of material in…
Q: Suppose during a financial statement or ICFR audit that the auditors identify cybersecurity risks…
A: Cybersecurity risks have been a big worry for businesses in recent years since they can result in…
Q: n auditor does not need to test the effectiveness of automated controls in a computerized system.…
A: Auditors are responsible are maintaining the account and checking accounts and checking accuracy of…
Q: financial statement fraud with asset misappropriation
A: Financial statement fraud is a deliberate attempt to conceal actual financial information so as to…
Q: f the auditor believes that a misstatement is or might be intentional and the effect on the…
A: Auditor: The auditor is the professional person who is appointed to conduct the official scrutiny of…
Q: audit engagement
A: Statement 1 is correct because an audit engagement is opinion based. The auditor conducts the…
Q: Which of the factors below is NOT one of the purposes of the audit report? A. Indicate any scope…
A: The management of the company is the main responsible for preparing the financial statements which…
Q: 1: The documentation of internal controls pertain only to those controls that are relevant to the…
A: Answer: 1: The documentation of internal controls pertain only to those controls that are relevant…
Q: Why is it important for auditors to consider the possibility of fraud by employees or management on…
A: There is a possibility of the occurrence of fraud by the employees or management of the company.…
Q: The auditor only obtains understanding of internal control related to significant risks identified…
A: Internal control process is related with effective and efficient use of available resources and it…
Q: Auditors must consider the possibility of fraud by employees or management on every audit…
A: Fraud: When someone intentionally uses false or misleading information in an effort to fraudulently…
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: Question: Which of the following statements accurately describes a fraud detection technique in…
A: Fraud detection techniques are styles, procedures, and instruments used by individualities,…
Q: If an auditor believes that a misstatement might be intentional and the effect on the financial…
A: c) If the auditors prepare the procedure and if check whether the fraud have taken place or going to…
Q: Auditors are important because they are able to provide assurance of an organization's financial…
A: Intimidation Threat :- An intimidation threat occur if the professional accountant is intimidated by…
Q: An independent auditor’s report is a guarantee that the financial statements are free from fraud or…
A: Auditor primary objectives is to give opinion on the financial statements and to give true and fair…
Q: As an auditor, you run across some abnormalities in a company’s books. What you find, makes you a…
A: An Auditor’s report is a letter by auditor in which information containing that company’s financial…
Q: . Identify from the following the situation/s where auditors are removed by the client. a. All the…
A: Solution: Following are the situations where auditors are removed by the client: 1. Involve in fraud…
Q: Which of these statements is/are correct? | If an auditor had the required knowledge and…
A: Audit means checking of financial statements of a company.
Q: ISA 240 the Auditor’s responsibilities relating to Fraud in an audit of financial statements,…
A: Part (i): The purpose is what distinguishes fraud from error. In s imple terms, fraud is a…
Q: An auditor's engagement letter most likely would include a statement regardıng: 1. Conditions under…
A: Auditing involves an independent examination of financial records of an entity with a view to…
Q: Accounting Which of the following statements is true regarding the identification and assessment of…
A: While undertaking audit for a client, auditor shall try to identify the potential areas of risk to…
Q: An independent auditor has the responsibility to design the audit to providereasonable assurance of…
A: The independent auditor’s plays a vital role regarding the internal controls of a public company.…
Q: whom should the auditors contact when they suspect a fraud? a. senior management b. audit…
A: Auditors are the persons who examine the financial statements of an entity to check the accuracy and…
Q: a) Explain why auditors’ reports are important to users of financial statements and why it is…
A: Auditing means an examination of the financial statements of the company and ensuring that…
Q: Which of the following is NOT a purpose of an audit of financial statements? a.To express an opinion…
A: Introduction:- The main purpose of audit on entity financial statements to express an opinion as to…
Q: ng dre You are appointed as an auditor for Sohar Electric Trading Company and finds that ontrols…
A: The auditors need to identify the risk of material statements in the financial report and respond…
Q: 1. Auditors use substantive
A: Planned detection risk is the risk that audit evidence will fail to detect misstatements…
Q: 3. Which of the following is NOT part of the control activities applicable to Financial Statement…
A: Solution Concept Financial statement audit During the audit of the financial…
Q: Question 1 i) In an audit of a non-public company, the more control risk there is, the smaller the…
A: Auditing is done on the financial statements of the company by an auditor in order to check out the…
Q: Auditing The external auditor may seek to place reliance/TRUSTON internal controls in order to…
A: Internal auditors are employees of the entity, which might result in risks to independence (real or…
Q: When planning the audit, the auditor must make enquiries of management. Which one of the following…
A: When planning an audit, the auditor must make enquiries of management about fraud to assess the risk…
Q: Auditing standards do not require auditors of financial statements toa. Understand the nature of…
A:
Q: Question 30 If the auditor plans to assess control risk at less than the maximum and rely on…
A: Introduction:- The auditor intends to evaluate audit risks at a reduced level than highest and…
Q: an audit firm is giving advice on accounting or control systems and helping the client with…
A: In the given case option C is correct.. Since it is neither a intimidation Threat nor a self review…
Determine whether statement 1 and 2 are true or false
4. S1 - Generally, the more reliable internal controls are, the lesser the substantive test procedures the auditor would need to perform in auditing year-end account balances
S2 - The industry in which the client operates may give rise to specific risks of material misstatements arising from the nature of the business or the degree of regulation
a. False, False
b. True, False
c. False, True
d. True, True
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Solved in 2 steps
- 1. The use of computer systems in financial reporting increases the risk of material misstatements. true or false 2. Automated controls in a computerized system are always more reliable than manual controls. true or false 3. Which of the following is NOT a requirement for an auditor to maintain independence? a. The auditor must not be related to any employees of the company being audited b. The auditor must not have any financial interest in the company being audited c. The auditor must not have any business relationships with the company being audited d. The auditor must have a significant financial stake in the company being audited 4. Which of the following is NOT a type of computer system control? a.Input controls b.Processing controls c.Output controls d.Feedback controlsestion 17 For audit evidence to be compelling to the auditor it must be sufficient and appropriate. Which statement below is not correct regarding the appropriateness of audit evidence? O A The more effective the internal control system, the more assurance it provides the auditor about the reliability of financial reporting by the client O B. The independent auditor's direct personal knowledge, obtained through inquiry, observation and inspection, is generally more persuasive than information obtained indirectly OC The timeliness of evidence is important as evidence is available only within certain time. OD None of the above.{Auditing} 8. One of the duties of an auditor is to prepare an audit plan for the smooth conduct of audit with due care and to detect fraud and errors. What other duty an auditor is expected to perform from options given below: a. Suggests changes in financial statements, if necessary b. Responsible to form opinion c. All the options d. To certify about the accuracy of financial statement
- A5Some auditors claim that increased exposure under creates a litigation environment that is unfairly risky for auditors. Do you think that the inability of auditors to detect a financial statement misstatement due to gross deficiencies in internal controls over financial reporting should expose auditors to litigation? Why or why not? Include reference to appropriate ethical standards in your response.7
- Which of the following characteristics is most likely to heighten an auditor’s concernabout the risk of material misstatements due to fraud in an entity’s financial statements?(1) The entity’s industry is experiencing declining customer demand.(2) Employees who handle cash receipts are not bonded.(3) Internal auditors have direct access to the board of directors and the entity’smanagement.(4) The board of directors is active in overseeing the entity’s financial reporting policies.Question 4 The auditor of a large public company has determined that a material weakness exists in the client's internal controls over financial reporting. Which of the following statements is true? Weakness require an adverse opinion on the financial statements taken as a whole. The auditor should express an adverse opinion on internal controls only if a material misstatement was found in the financial statements. The auditor should express and adverse opinion on internal controls even though no material misstatements were found in the financial statements. The auditor is not required to express an opinion on internal controls.a) Auditors (Internal & External) are required to deal with fraud and error which represents risks to an entity. Their responsibilities however differ in relation to fraud and risks Required: (i) Explain what role the internal audit function plays in relation to risks of fraud and error in an entity. (ii) Whataretheresponsibilitiesofanexternalauditorinrelationtotheriskoffraud and error during the audit of financial statements?
- 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 subject12. The audit of revenue and receivables is of significant audit risk because Select one:a. The understatement of revenue results in a corresponding overstatement of net incomeb. Understatement of revenue has been a factor in many instances of fraudulent financial reportingc. Overstatement of revenue has been a factor in many instances of fraudulent financial reporting,d. The overstatement of revenue results in a corresponding understatement of net incomeWhich of the following is/are the least persuasive type of audit evidences? 1. Photocopies of sales invoices inspected by the auditor 2. Documents obtained by auditor from third parties directly 3. Bank statements obtained from the client 4. Computations made by the auditor. 1, 3 and 4 only 1 and 3 only 2 only 1 only Which one of the following indicates high degree of detection risk in respect to fl
