Auditing and Assurance Services (16th Edition)
16th Edition
ISBN: 9780134065823
Author: Alvin A. Arens, Randal J. Elder, Mark S. Beasley, Chris E. Hogan
Publisher: PEARSON
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Question
Chapter 8, Problem 28.1MCQ
To determine
Identify the procedures under which the CPA would least likely perform the planning stage of the audit.
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Concerning litigation, claims, and assessments, which of the following is an audit procedure that an auditor
Concerning litigation, claims, most likely would perform ?
Select one:
a. Confirm directly with the client’s lawyer that all litigation, claims, and assessments have been recorded or disclosed in the financial statements.
b. Discuss with management its policies and procedures adopted for evaluating and accounting for litigation, claims, and assessments.
c. Request the client’s lawyer to evaluate whether the client’s pending litigation, claims, and assessments indicate a going concern problem.
d. Examine the legal documents in the client’s lawyer’s possession concerning litigation, claims, and assessments to which the lawyer has devoted substantive attention.
Depending on the severity of the audit issue, follow-up activities could include all of the following EXCEPT:
Re-auditing the processes that originally led to the audit issue
Reviewing updated procedures or documentation
Interviewing staff
Discussion with the stakeholders
On which one of the following ways can the services of internal auditor be availed?
Is it OK to give the client copies of the auditor's previous documents? If so, what should the auditors look for before giving the documentation to the client? At least three things.
Chapter 8 Solutions
Auditing and Assurance Services (16th Edition)
Ch. 8 - Prob. 1RQCh. 8 - Prob. 2RQCh. 8 - Prob. 3RQCh. 8 - Prob. 4RQCh. 8 - Prob. 5RQCh. 8 - Prob. 6RQCh. 8 - Prob. 7RQCh. 8 - Prob. 8RQCh. 8 - Prob. 9RQCh. 8 - Prob. 10RQ
Ch. 8 - Prob. 11RQCh. 8 - Prob. 12RQCh. 8 - Prob. 13RQCh. 8 - Prob. 14RQCh. 8 - Prob. 15RQCh. 8 - Your client, Harper Company, has a contractual...Ch. 8 - Prob. 17RQCh. 8 - Prob. 18RQCh. 8 - Prob. 19RQCh. 8 - Prob. 20RQCh. 8 - Prob. 21RQCh. 8 - Prob. 22RQCh. 8 - Prob. 23RQCh. 8 - Prob. 24RQCh. 8 - Prob. 25.1MCQCh. 8 - Prob. 25.2MCQCh. 8 - Prob. 25.3MCQCh. 8 - Prob. 26.1MCQCh. 8 - Prob. 26.2MCQCh. 8 - Prob. 26.3MCQCh. 8 - Which one of the following statements is correct...Ch. 8 - Prob. 27.2MCQCh. 8 - Prob. 27.3MCQCh. 8 - Prob. 28.1MCQCh. 8 - Prob. 28.2MCQCh. 8 - Prob. 28.3MCQCh. 8 - Prob. 29DQPCh. 8 - Prob. 30DQPCh. 8 - Prob. 31DQPCh. 8 - Your comparison of the gross margin percent for...Ch. 8 - Prob. 33DQPCh. 8 - Prob. 34DQPCh. 8 - Prob. 35DQPCh. 8 - Prob. 36DQPCh. 8 - Prob. 37DQPCh. 8 - Following are statements of earnings and financial...
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Similar questions
- Which of the following factors most likely affects the auditor's judgment about the quantity, type, and content of working papers? The nature and condition of the client's accounting and internal control systems The content of the client's representation letter. The timing of substantive tests completed prior to the balance sheet date d The usefulness of the working papers as a reference source for the clientarrow_forwardIn gathering evidence to conduct an audit, it is important for the following information: identification of the name of the client, period covered, description of the contents, initial of the preparer, date of the preparation, and an index code. explain why it is important for these items to be included in the evidence gathering.arrow_forwardWhat is an auditor’s primary method to corroborate information on litigation, claims, andassessments?a. Examining legal invoices sent by the client’s attorney.b. Verifying attorney–client privilege through interviews.c. Reviewing the response from the client’s lawyer to a letter of audit inquiry.d. Reviewing the written representation letter obtained from management.arrow_forward
- 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 proceduresarrow_forwardIs it allowed to send copies of the auditor's earlier paperwork to the client? If yes, are there any special criteria that auditors should review prior to delivering the client's documentation? At least three things should be mentioned.arrow_forwardTo obtain an understanding of a continuing client in planning an audit, an auditor most liky would; A. Perform test of details of transactions and balances B. Read internal audit reports. C. Read Specialized industry journals. D. Reevaluate the risks of material misstatementarrow_forward
- Explain why the decision to accept a client is important and describe the primary features of client acceptance and continuance, including the purpose and content of an audit engagement letter.arrow_forwardWhich of the following should not be considered at the planning phase of the audit? a.identification of analytical procedures to be used in examination b.understanding of the legal framework of the client c.the extent of materiality d.the type of audit opinion to be givenarrow_forwardThe use of an audit engagement letter is the best method of assuring the auditor will have which of the following?Select one: a. Cooperation from other auditors b. Auditor will obtain sufficient appropriate audit evidence. c. Access to all books, accounts and vouchers required for audit purpose d. Management representation letterarrow_forward
- A CPA accumulates various types of evidence on which to base the opinion on financial statements. Among this evidence are confirmations from third parties.Required:a. What is an audit confirmation?b. What characteristics of the confirmation process and the recipient are important if a CPA is to consider the confirmation evidence appropriate?arrow_forwardlist the four types of information the auditor should obtain or review as a part of gaining background information for the audit, and provide one specific example of how the information will be useful in conducting an audit.arrow_forwardThe auditor is required to prepare audit documentation sufficient to enable an experienced auditor, having no previous connection with the audit, to understand the _________________ in reaching conclusions on significant matters arising during the audit. Select one: a. Confirmation letters b. The interviews conducted with employees and management c. The total evidence gathered d. Significant professional judgements madearrow_forward
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