AUDITING-TEXT (LOOSELEAF)
11th Edition
ISBN: 9781337619462
Author: JOHNSTONE
Publisher: CENGAGE L
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Question
Chapter 1, Problem 4CYBK
To determine
Introduction:Auditor’s independence ensures that auditor conducts audit in a fair manner and as per the established standards and rules without any bias or managerial influence that may affect the work performed.
To identify:Thefactor that does not give rise to need of independent external audit services.
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Students have asked these similar questions
Which of the following activities should the internal audit function NOT be involved in?a. Monitoring of management's performanceb. Reviewing adequacy of management information for decision-making purposesc. Taking responsibility for the implementation of a new sales ledger systemd. Assessing compliance with regulation
Internal auditors may not perform:a. Audits of financial statements resulting in reports intended for management’s use only.b. Integrated audits leading to an audit opinion issued in accordance with PCAOB standards.c. Forensic audits.d. All of the above.
An “integrated audit”, as required by Sarbanes-Oxley Act for U.S. public companies,includes an audit ofa. The company’s internal controlsb. The company’s financial statementsc. The company’s compliance with its rules and policiesd. Both A and B
The auditor’s opinions on the effectiveness of internal control over financial reporting (ICFR) in anintegrated audit in accordance with PCAOB AS include the following types…
When processing controls within the accounting information system may not leave visible evidence that could be inspected by audit teams, the teams shoulda. Make corroborative inquiries.b. Observe the separation of duties of personnel.c. Review transactions submitted for processing and compare them to related output.d. Review the run manual.
Why is there a need on the part of the client entity to monitor internal controls over time?
a. Because the auditor needs to obtain understanding of internal control
b. Because unmonitored controls tend to deteriorate over time
c. Because it will affect the timing of substantive audit procedures
d. Because it is a requirement of the applicable financial reporting framework
Chapter 1 Solutions
AUDITING-TEXT (LOOSELEAF)
Ch. 1 - Prob. 1CYBKCh. 1 - Prob. 2CYBKCh. 1 - Prob. 3CYBKCh. 1 - Prob. 4CYBKCh. 1 - Prob. 5CYBKCh. 1 - Prob. 6CYBKCh. 1 - Prob. 7CYBKCh. 1 - Prob. 8CYBKCh. 1 - Prob. 9CYBKCh. 1 - Prob. 10CYBK
Ch. 1 - Prob. 11CYBKCh. 1 - Prob. 12CYBKCh. 1 - Utilitarian theory holds that what is ethical is...Ch. 1 - Prob. 14CYBKCh. 1 - Which of the following statements related to...Ch. 1 - Utilitarianism does not require which of the...Ch. 1 - Prob. 17CYBKCh. 1 - Prob. 18CYBKCh. 1 - Prob. 19CYBKCh. 1 - Which of the following factors is not an example...Ch. 1 - Prob. 1RQSCCh. 1 - Prob. 2RQSCCh. 1 - Prob. 3RQSCCh. 1 - Prob. 4RQSCCh. 1 - Prob. 5RQSCCh. 1 - Prob. 6RQSCCh. 1 - Prob. 7RQSCCh. 1 - Prob. 8RQSCCh. 1 - Prob. 9RQSCCh. 1 - Prob. 10RQSCCh. 1 - Prob. 11RQSCCh. 1 - Prob. 12RQSCCh. 1 - Prob. 13RQSCCh. 1 - Prob. 14RQSCCh. 1 - Prob. 15RQSCCh. 1 - Prob. 16RQSCCh. 1 - Prob. 17RQSCCh. 1 - Prob. 18RQSCCh. 1 - Prob. 19RQSCCh. 1 - Prob. 20RQSCCh. 1 - Prob. 21RQSCCh. 1 - Prob. 22RQSCCh. 1 - Prob. 23RQSCCh. 1 - Prob. 24RQSCCh. 1 - Prob. 25RQSCCh. 1 - Prob. 26RQSCCh. 1 - Prob. 27RQSCCh. 1 - Prob. 28RQSCCh. 1 - Prob. 29RQSCCh. 1 - Prob. 30RQSCCh. 1 - Prob. 31RQSCCh. 1 - Refer to the Why It Matters feature “What Is...Ch. 1 - Prob. 33RQSCCh. 1 - Prob. 34RQSCCh. 1 - Prob. 35RQSCCh. 1 - Prob. 36RQSCCh. 1 - Prob. 37RQSCCh. 1 - As the auditor for XYZ Company, you discover that...Ch. 1 - Prob. 39RQSCCh. 1 - Prob. 40RQSCCh. 1 - Prob. 41RQSCCh. 1 - Prob. 42RQSCCh. 1 - Prob. 43FFCh. 1 - Prob. 44FFCh. 1 - Prob. 45FFCh. 1 - Prob. 46FF
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Similar questions
- Which of the following is not an element of internal control? A) Only promoting from within. B) Implement segregation of duties. C) Maintain adequate accounting records. D) Conduct internal audits.arrow_forwardWhich of the following is not a function or benefit of a checklist? Providing evidence of audit planning Reducing workload for the auditee Reducing risk of auditor bias Maintaining the audit pace and continuityarrow_forwardWhich one of the following is not an objective of a system of internal controls? Select one: 1. Overstate liabilities in order to be conservative 2. Enhance the accuracy and reliability of accounting records 3. Safeguard company assets 4. Reduce the risks of errorsarrow_forward
- Which of the following items is an example of an inherent limitation in an intrnal control system? A. Segregation of employee duties B. Human error in decision making C. Ineffective board of directors D. Understaffed internal audit functions.arrow_forwardWhich of the following does not accurately summarize auditors’ requirements regarding internal control?arrow_forwardWhen obtaining an understanding of an entity’s internal control, an auditor should concentrate on the substance ofcontrols rather than their form because:Select one: a. Management may establish appropriate controls but not enforce compliance with them. b. The controls may be operating effectively but may not be documented. c. The controls may be so inappropriate that no reliance is contemplated by the auditor. d. Management may implement controls whose costs exceed their benefits.arrow_forward
- Which is not a Risk Assessment Procedure? a. Ratio Analysis b. Observation of Activities c. Account Receivable confirmations d. Inspection of Documents e. Inquiry of Internal Auditorsarrow_forwardHow might financial incentives in the form of client services unconsciously introduce auditor bias into the independent audit function? Are there any solutions to the conflict?arrow_forwardThe primary difference between operational auditing and financial auditing is that in operational auditinga. The operational auditor is not concerned with whether the audited activity is generating information in compliance with financial accounting standards.b. The operational auditor is seeking to help management use resources in the most effective manner possible.c. The operational auditor starts with the financial statements of an activity being audited and works backward to the basic processes involved in producing them.d. The operational auditor can use analytical skills and tools that are not necessary in financial auditing.arrow_forward
- The primary difference between operation auditing and financial auditing is that in operational auditing....a.) The operational auditor is not concerned with whether the audited activity is generating information in compliance with financial accounting standardsb.) The operational auditor is seeking to help management use resources in the most effective manner possible.c.) The operational auditor starts with the financial statements of an activity being audited and works backward to the basic processes involved in producing them.d.) The operation auditor can use analytical skills and tools that are not necessary in financial auditing.arrow_forwardThe following questions deal with assessing controlrisk in a financial statement audit. Choose the best response.a. When obtaining an understanding of an entity’s internal control procedures, anauditor should concentrate on the substance of procedures rather than their formbecause:(1) the procedures may be operating effectively but may not be documented.(2) management may establish appropriate procedures but not enforce compliancewith them.(3) the procedures may be so inappropriate that no reliance is contemplated by theauditor.(4) management may implement procedures whose costs exceeds their benefitsarrow_forwardAn auditor is likely to use procedures to support the operating effectiveness of internal controls. Which of the following would generally not be used ? Select one : O a. Re -perform client procedures O b. Examine documents , records, and reports O c. Make inquiries of appropriate client personnel O d. Analytical proceduresarrow_forward
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