Performance audits differ from financial audits in that A. The GAO's "general standards" do notapply to performance audits B. In conducting performance audits, the auditors do not necessarilyattest to assertions of management C. The auditors need not issue a formal report setting forththeir findings D. The main focus should be on activities that satisfy the criteria of Circular A-133 as"major programs"

The correct answer is B. In conducting performance audits, the auditors do not necessarily attest to…

Answered: Performance audits differ from…

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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Your answer is incorrect. When and why are analytical procedures performed by an auditor? Select all that apply. risk response phase to evaluate information included in the financial statements reporting phase to evaluate the effectiveness of controls Orisk assessment phase to assess if the financial statements reflect the auditor's understanding of the client O risk assessment phase to identify unusual fluctuations O reporting phase to identify areas of potential material misstatements
A CAM should be included in the report if it a. Focuses on matters involving challenging, subjective, or complex auditor judgment. b. Is based on dollar amounts objectively determined and supported by evidence deemed appropriate by the CPA. c. Refers to standards of both the AICPA and the PCAOB. d. Refers to the predecessor CPA not re-issuing the audit opinion on the previous financial statements. e. Focuses on the combination of the audit of the financial statements and the audit of the internal control effectiveness.
Which of the following matters is an auditor not required to communicate to those charged with governance? A. Significant adjustments arising from the audit that were recorded by management. B. The basis for the auditor's conclusions about the reasonableness of management's sensitive accounting estimates. The level of responsibility assumed by the auditor under generally accepted auditing standards. The degree of reliance the auditor placed on the management representation letter.. O C. D.
The following information pertains to internal controls at company A and company B respectively. Company A Company B Controls are strong Controls are Weak If an audit of these companies is performed according to the AICPA auditing standards, the auditor will: COMPANY A COMPANY B A Test controls Not test controls B Not test controls Test controls C Test Controls Test Controls D Not test controls Not test Control Group of answer choices
Which of the following is a key change to audit reports per SAS No. 134? O a. It alters the look forward period for evaluating going concern uncertainty. O b. It explicitly assigns responsibility for evaluating going concern to the auditors. Oc. Reporting language related to substantial doubt about an entity's ability to continue as a going concern was eliminated. O d. Reporting language related to substantial doubt about an entity's ability to continue as a going concern was enhanced.
List of matters normally communicated to those charged with governance includes: a) The overall approach and scope of the audit, including any limitations on the scope of the audit. b) The accounting policies and any changes to them that could materially affect the financial statements. c) Adjustments arising as a result of audit procedures which may not materially impact the financial statements. d) Material events or uncertainties which could jeopardize the going concern status, and which does not require disclosure within the financial statements e) Disagreements with management over accounting treatments or disclosures Any expected modifications to the audit report f) Material weaknesses discovered in the internal systems and controls. All a) , b) , c) , d) , e) and f) Only a) , b) , e) and f) Only a) , b) and c) Only a) , b) , c) and e) Only a) , e) and f)
If the auditor determines that an internal control deficiency is either a significant deficiency or a control deficiency, the auditor will issue a/an _______ on internal controls over financial reporting (ICFR) A. adverse opinion B. unmodified opinion C. unqualified opinion D. modified opinion
Which of the following statements is NOT correct about materiality?Select one: a. Auditor’s consideration of materiality is influenced by the auditor’s perception of the needs of an informed decision maker who will rely on the financial statements b. Materiality is a relative concept c. Materiality judgments involve both quantitative and qualitative judgments d. At the planning state, the auditor considers materiality at the financial statement level only

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