Auditing: A Risk Based-Approach (MindTap Course List)
11th Edition
ISBN: 9781337619455
Author: Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher: Cengage Learning
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Question
Chapter 7, Problem 2RQSC
To determine
Introduction: Two different approaches of Materiality and the advantages or disadvantages of both approaches.
To explain: Usage of different approaches of materiality, one is methodical and other one is based on personal judgment and the advantages and disadvantages of both approaches.
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What is a post-audit, why do firms use them, and what problems can arise when they are used?
Which of the following is the best description of reliability in relation to information in financial statements?
Comprehensibility to users
Influence on the economic decisions
Freedom from material error and bias
Inclusion of degree of caution of users
What is the term used to describe a systematic process of objectively obtaining evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between those assertions and established criteria and communicating the results to interested users?
a.
Financial statement audit.
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Internal audit.
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Program audit
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External audit.
Chapter 7 Solutions
Auditing: A Risk Based-Approach (MindTap Course List)
Ch. 7 - Prob. 1CYBKCh. 7 - Prob. 2CYBKCh. 7 - Prob. 3CYBKCh. 7 - Prob. 4CYBKCh. 7 - Prob. 5CYBKCh. 7 - Prob. 6CYBKCh. 7 - Prob. 7CYBKCh. 7 - Prob. 8CYBKCh. 7 - Prob. 9CYBKCh. 7 - Prob. 10CYBK
Ch. 7 - Prob. 11CYBKCh. 7 - Prob. 12CYBKCh. 7 - Prob. 1RQSCCh. 7 - Prob. 2RQSCCh. 7 - Prob. 3RQSCCh. 7 - Prob. 4RQSCCh. 7 - Prob. 7RQSCCh. 7 - Prob. 8RQSCCh. 7 - How does inherent risk relate to internal...Ch. 7 - Prob. 10RQSCCh. 7 - Prob. 11RQSCCh. 7 - Prob. 12RQSCCh. 7 - Prob. 13RQSCCh. 7 - Prob. 14RQSCCh. 7 - Prob. 15RQSCCh. 7 - Prob. 17RQSCCh. 7 - Prob. 18RQSCCh. 7 - Prob. 19RQSCCh. 7 - Prob. 22RQSCCh. 7 - Prob. 23RQSCCh. 7 - Prob. 24RQSCCh. 7 - Prob. 25RQSCCh. 7 - Prob. 26RQSCCh. 7 - Prob. 27RQSCCh. 7 - Prob. 29FF
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Similar questions
- 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_forwardWhich type of audit is an investigation into whether or not the use of resources is economic, efficient and effective? a. Forensic Audit b. Public Sector Audit c. Value for Money Audit d. Environmental Auditarrow_forwardAn assurance service is defined as a service thata. Provides auditing services to nonfinancial information.b. Reviews unaudited financial information.c. Improves the quality of information for decision makers.d. Reduces the risk in management decision making.arrow_forward
- Which of the following approaches is most suitable for auditing the finance and investment cycle?a. Perform extensive tests of controls and limit substantive procedures to analytical procedures.b. Ignore internal controls and perform extensive substantive procedures.c. Gain an understanding of internal controls and perform extensive substantive procedures.d. Ignore internal controls and limit substantive procedures to analytical procedures.arrow_forwardWhich of the following are correct regarding why management uses internal controls? (Check all that apply.) Multiple select question. Protect assets. Uphold company policies. Ensure reliable accounting. Reduce vendor payables. Increase revenues. Promote efficient operations.arrow_forwardIn an attempt to reduce business costs, and given the current competitive business environment, audit tendering is sometimes used for large audits. REQUIRED Identify the advantages and disadvantages of audit tendering.arrow_forward
- Which of the following is true about designing an accounting−based performance measure? A. Management's beliefs are not required during the analyses. B. The issues considered in each step are independent. C. The decisions made in steps are followed in a hierarchical order. D. Behavioral criteria are important when evaluating the stepsarrow_forwardIn testing for lower-of-cost-or-market, the auditor is gathering evidence to support which of the following assertions? a. Accuracy. b. Rights and obligations. c. Valuation. d. Pricing.arrow_forwardIn terms of an audit, define " substantive strategy " and " reliance strategy ". How do the different strategies relate to internal conrol? Which strategy would best relate to a lower control risk?arrow_forward
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