Auditing & Assurance Services: A Systematic Approach (Irwin Accounting)
10th Edition
ISBN: 9780077732509
Author: William F Messier Jr, Steven M. Glover Associate Professor, Douglas F. Prawitt Associate Professor
Publisher: McGraw-Hill Education
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Chapter 6, Problem 6.24MCQ
To determine
Concept Introduction:
Documentation is important part of an audit. The auditor documents each phase of the audit, working papers, and evidences gathered during the audit. These documents help auditor to prove his work.
To choose: Thecorrect statement about the auditor’s flow chart of an entity’s accounting system.
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Which of the following types of evidence would an auditor most likely examine to determine whether internal control is operating as designed?Select one:
a.
Client records documenting the use of computer programs.
b.
Gross margin information regarding the client’s industry.
c.
Confirmations of receivables verifying account balances.
d.
Anticipated results documented in budgets or forecasts.
An internal auditor is examining the effectiveness of procedures management established to protect customer data from cyberattacks and whether those procedures are cost effective. This is an example of an operational audit.
Question options:
True
False
Which of the following audit techniques ordinarily would provide an auditor with the least assurance about the operating effectiveness of an internal control activity?
a. Inquiry of client personnel.
b. Inspection of documents and reports.
c. Observation of client personnel.
d. Preparation of system flowcharts.
Chapter 6 Solutions
Auditing & Assurance Services: A Systematic Approach (Irwin Accounting)
Ch. 6 - Prob. 6.1RQCh. 6 - Prob. 6.2RQCh. 6 - Prob. 6.3RQCh. 6 - Prob. 6.4RQCh. 6 - Prob. 6.5RQCh. 6 - Prob. 6.6RQCh. 6 - Prob. 6.7RQCh. 6 - Prob. 6.8RQCh. 6 - Prob. 6.9RQCh. 6 - Prob. 6.10RQ
Ch. 6 - Prob. 6.11RQCh. 6 - Prob. 6.12MCQCh. 6 - Prob. 6.13MCQCh. 6 - Prob. 6.14MCQCh. 6 - Prob. 6.15MCQCh. 6 - Prob. 6.16MCQCh. 6 - Prob. 6.17MCQCh. 6 - Prob. 6.18MCQCh. 6 - Prob. 6.19MCQCh. 6 - Prob. 6.20MCQCh. 6 - Prob. 6.21MCQCh. 6 - Prob. 6.22MCQCh. 6 - Prob. 6.23MCQCh. 6 - Prob. 6.24MCQCh. 6 - Prob. 6.25PCh. 6 - Prob. 6.26PCh. 6 - Prob. 6.27PCh. 6 - Prob. 6.28PCh. 6 - Prob. 6.29PCh. 6 - Prob. 6.30PCh. 6 - Prob. 6.31P
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- When planning the audit of internal controls for an issuer, the audit team shoulda. Identify significant accounts, locations, and assertions.b. Conduct a walkthrough of the internal control process.c. Make inquiries of employees regarding the existence of control activities.d. Reperform control activities performed by client employees to determine theireffectiveness.arrow_forwardWhat are the three potential tools available to auditors for documenting their understanding of a client's system of internal control?arrow_forwardWrite a comprehensive research paper on on internal controls and internal auditing. Clearly Defining what is meant by internal control, Distinguishing among the major components of a client’s internal control: the control environment, risk assessment, control activities, the accounting information system, and monitoring of controls. And lastly, Describing the auditors' consideration of internal control.arrow_forward
- Explain the primary purpose of the Management letter. Discuss the various components of internal control in the COSO internal control framework. Explain the concept ‘review of subsequent events’ and their significance in the audit of a client. Explain the concept ‘Contingent liabilities’ and their significance in the audit of a client.arrow_forwardAnalytical procedures are generally used to produce evidence froma. Confirmations mailed directly to the auditors by client customers.b. Physical observation of inventories.c. Relationships among current financial balances and prior balances, forecasts, and nonfinancial data.d. Detailed examination of external, external-internal, and internal documents.arrow_forwardTests of controls in a GAAS audit are used for O Applying analytical procedures to financial statement balances Obtaining evidence about the financial statement assertions O Accomplishing control over the occurrence of recorded transactions O Obtaining evidence about the operating effectiveness of client control activitiesarrow_forward
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