EBK AUDITING+ASSURANCE SERVICES
17th Edition
ISBN: 9780135171219
Author: ARENS
Publisher: PEARSON CO
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Chapter 7, Problem 25.2MCQ
To determine
Identify which is considered as audit files.
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During an audit engagement, pertinent data are compiled and included in the auditfiles. The audit files primarily are considered to be(1) a client-owned record of conclusions reached by the auditors who performedthe engagement.(2) evidence supporting financial statements.(3) support for the auditor’s representations as to compliance with auditing standards.(4) a record to be used as a basis for the following year’s engagement
The preparation of audit documentation is an integral part of an auditor’s examination of financial statements. On a recurring engagement, auditors review the audit plans and audit documentation from the prior audit while planning the current audit to determine their usefulness for the current-year work.Required:a. (1) What are the purposes or functions of audit documentation? (2) What records may be included in audit documentation?b. What factors affect the auditors’ judgment of the type and content of the audit documentation for a particular engagement?c. What should be included in audit documentation to support auditors’ compliance with generally accepted auditing standards?d. How can auditors make the most effective use of the prior-year audit plans in a recurring audit?
The date of the CPA’s opinion on the financial statements of the client should be the date of the:
Select one:
a. submission of the report to the client.
b. closing of the client’s books.
c. finalization of the terms of the audit engagement
d. completion of all important audit procedures
Chapter 7 Solutions
EBK AUDITING+ASSURANCE SERVICES
Ch. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Prob. 3RQCh. 7 - Prob. 4RQCh. 7 - Prob. 5RQCh. 7 - Prob. 6RQCh. 7 - Prob. 7RQCh. 7 - Prob. 8RQCh. 7 - Prob. 9RQCh. 7 - Prob. 10RQ
Ch. 7 - Prob. 11RQCh. 7 - Prob. 12RQCh. 7 - Prob. 13RQCh. 7 - Prob. 14RQCh. 7 - Prob. 15RQCh. 7 - Prob. 16RQCh. 7 - Prob. 17RQCh. 7 - Prob. 18RQCh. 7 - Prob. 19RQCh. 7 - Prob. 20RQCh. 7 - Define what is meant by a tick mark. What is its...Ch. 7 - Prob. 22RQCh. 7 - Prob. 23.1MCQCh. 7 - Prob. 23.2MCQCh. 7 - Prob. 23.3MCQCh. 7 - Prob. 24.1MCQCh. 7 - Prob. 24.2MCQCh. 7 - Prob. 24.3MCQCh. 7 - Prob. 25.1MCQCh. 7 - Prob. 25.2MCQCh. 7 - Prob. 25.3MCQCh. 7 - Prob. 26.1MCQCh. 7 - Prob. 26.2MCQCh. 7 - Prob. 26.3MCQCh. 7 - Prob. 27DQPCh. 7 - Prob. 28DQPCh. 7 - Prob. 29DQPCh. 7 - Prob. 30DQPCh. 7 - Prob. 31DQPCh. 7 - Prob. 32DQPCh. 7 - Prob. 33DQPCh. 7 - Prob. 34DQPCh. 7 - Prob. 36DQPCh. 7 - Prob. 37DQPCh. 7 - Prob. 40DQP
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Similar questions
- An audit strategy memorandum containsa. Specifications of auditing standards relevant to the financial statements being audited.b. Specifications of procedures the auditors believe appropriate for the financial statements under audit.c. Documentation of the assertions under audit, the evidence obtained, and the conclusions reached.d. Reconciliation of the account balances in the financial statements with the account balances in the client’s general ledger.arrow_forwardAfter the financial statements are issued, auditors finish the substantive procedures. Identify the most frequently performed auditing tasks.arrow_forwardThe particular and specialized actions that auditors take to obtain evidence during a specific engagement are known asa. Audit procedures.b. Audit standards.c. Interpretive publications.d. Statements on Auditing Standardsarrow_forward
- Auditors perform analytical procedures in the planning stage of an audit for the purpose ofa. Deciding the matters to cover in an engagement letter.b. Identifying unusual conditions that deserve more auditing effort.c. Determining which of the financial statement assertions are the most important for theclient’s financial statements.d. Determining the nature, timing, and extent of further audit procedures for auditing theinventory.arrow_forwardAudit standards require auditors to _______. conduct specific audit procedures to identify subsequent events that may occur up through the date of the auditor’s report conduct specific audit procedures to identify subsequent events that may occur after the date of the auditor’s report. apply optional use of analytical procedures to increase assurance levels related to subsequent events delegate auditing of subsequent events to the internal audit function A compilation engagement is _______. an audit of the financial statements, whereby an auditor expresses an opinion on the financial statements an audit of the system of internal control, whereby an auditor expresses an opinion on the system of internal control when an accounting firm assists management in the presentation of financial statements but does not audit, review, nor provide assurance as to whether the financial statements are presented fairly. when an audit firm assists management in the presentation of financial…arrow_forwardWhich of the following engagements is most likely to be considered an operational audit? The auditor determines whether the organization is following provisions of laws and regulations. The auditor examines information presented in an entity’s financial statements to determine whether the financial statements are presented fairly in accordance with the applicable financial reporting framework. The auditor evaluates the organization’s efficiency in processing payments. The auditor assists the client in preparation of financial statements.arrow_forward
- An audit plan containsa. Specifications of audit standards relevant to the financial statements being audited.b. Specifications of procedures the auditors believe appropriate for the financial statementsunder audit.c. Documentation of the assertions under audit, the evidence obtained, and the conclusionsreached.d. Reconciliation of the account balances in the financial statements with the account balances in the client’s general ledger.arrow_forwardWhich of the following types of audit evidence generally is the most reliable? A. Inquiries made of management B. confirmation of account information C. analytical procedures D. review the prior-year audit processarrow_forwardAnalytical procedures are an important part of the audit process and consist of the evaluation of financial information by the study of plausible relationships among financial and nonfinancial data. Analytical procedures may be done during planning, as a substantive test, or as a part of the overall review of an audit. The following are various statements regarding the use of analytical procedures: Should focus on enhancing the auditor’s understanding of the client’s business and the transactions and events that have occurred since the last audit date Should focus on identifying areas that may represent specific risks relevant to the audit Require documentation in the working papers of the auditor’s expectation of the ratio or account balance Generally use data aggregated at a lower level than the other stages Should include reading the financial statements and notes to consider the adequacy of evidence gathered Not required during this stage Involve reconciliation of…arrow_forward
- After completing and documenting the ADA procedures, the auditor evaluates the audit evidence obtained and develops a conclusion based on the audit evidence. Indicate what the conclusion relates to. a. ADA procedures utilized. b. Relevance and reliability of audit evidence. c. Specific phase of audit where ADA utilized. d. Completeness of audit evidence.arrow_forwardThe external auditor should fulfill several performance responsibilities in order to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement . Among these responsibilities is Select one : a. providing an opinion on the financial statements . b. exercising professional judgment. verifying that all audit work is performed by the auditor with a minimum of three years ' experience . d. Accumulating sufficient , appropriate audit evidence.arrow_forwardThe audit process is the sequence of different activities involved in an audit. Identify the phase in the audit that is captured by this primary objective: 1. To assess and evaluate the quality of services delivered by the engagement team. * 2. To assess the different risks associated with the audit to determine the nature, timing and extent of further audit procedures necessary to be performed. * 3. To assist the auditor in assessing conclusion reached whether it is consistent with evidence gathered. * Pre-engagement Audit planning Consideration of internal controls Evidence-gathering (substantive testing) Completing the audit Issuance of the audit report Post-audit responsibilitiesarrow_forward
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