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Ch03-Maintaining Professional Responsibility - Regulation and Legal Liability
Ch03-Maintaining Professional Responsibility - Regulation and Legal Liability
MULTIPLE CHOICE:
ANSWER: D
ANSWER: B
ANSWER: C
36
Chapter 4 Audit Evidence and Audit Programs 37
ANSWER: C
ANSWER: A
ANSWER: C
ANSWER: D
38 Chapter 4 Audit Evidence and Audit Programs
ANSWER: D
ANSWER: C
ANSWER: A
ANSWER: D
ANSWER: C
ANSWER: D
ANSWER: B
ANSWER: B
40 Chapter 4 Audit Evidence and Audit Programs
ANSWER: A
ANSWER: D
ANSWER: D
ANSWER: C
ANSWER: A
21. The in-charge auditor decides that work papers are complete
a. When satisfied that the audit objectives have been met
and the working papers support the conclusions.
b. When working papers make reference to the steps
outlined in the audit program.
c. Only after the auditor who prepared the working papers
has signed and dated them.
d. When proper cross-references to other working papers
are noted.
ANSWER: A
ANSWER: C
ANSWER: C
ANSWER: C
ANSWER: D
ANSWER: C
ANSWER: C
ANSWER: D
29. Audit working papers are used to record the results of the
auditor's evidence-gathering procedures. When preparing
working papers, the auditor should remember that working
papers should be
a. Kept on the client's premises so that the client can
have access to them for reference purposes.
b. The primary support for the financial statements
being examined.
c. Considered as a part of the client's accounting records
that are retained by the auditor.
d. Designed to meet the circumstances and the auditor's
needs on each engagement.
ANSWER: D
ANSWER: B
ANSWER: C
ANSWER: C
ANSWER: A
ANSWER: B
ANSWER: B
ANSWER: D
ANSWER: D
ANSWER: D
ANSWER: A
ANSWER: B
ANSWER: B
ANSWER: D
ANSWER: A
ANSWER: A
ANSWER: B
ANSWER: B
ANSWER: D
ANSWER: A
ANSWER: D
48 Chapter 4 Audit Evidence and Audit Programs
ANSWER: B
ANSWER: A
ANSWER: D
ANSWER: D
ANSWER: D
ANSWER: B
COMPLETION:
56. Audit programs can be developed only after the auditor has
completed the audit _______________ process.
ANSWER: PLANNING
ANSWER: SUFFICIENCY
ANSWER: PHYSICAL
ANSWER: DOCUMENTED
ANSWER: COMPLETENESS
ANSWER: MATHEMATICAL
MATCHING:
a. Physical evidence
b. Confirmation evidence
c. Documentary evidence
d. Analytical evidence
e. Mathematical evidence
f. Hearsay evidence
SOLUTION:
1. e
2. c
3. a
4. d
5. d
6. b
7. f
8. e
9. b
10. a
11. d
a. Existence or occurrence
b. Completeness
c. Rights and obligations
d. Valuation or allocation
e. Presentation and disclosure
SOLUTION:
1. a,d
2. d
3. e
4. b
5. b,c
6. a,c,d
7. d
8. e
9. a
10. b
PROBLEM/ESSAY
1. Cash in bank
2. Sales revenue
3. Inventories
4. Accounts payable
5. Notes payable
6. Capital stock
7. Marketable securities
8. Operating expenses
9. Wages and salaries expense
10. Property, plant, and equipment
SOLUTION:
Required:
SOLUTION:
a. Sufficient audit evidence is evidence that is adequate
to support the auditor’s opinion on the financial statements. A
matter of audit judgment, sufficiency is usually based on
materiality and the adequacy of existing internal control.
b. Validity of audit evidence is a function of three
qualities:
1) The independence and competence of the source of
the evidence (e.g., external evidence possesses
greater validity than internal evidence);
2) The conditions under which the evidence was
54 Chapter 4 Audit Evidence and Audit Programs
Required:
SOLUTION:
a.
Chapter 4 Audit Evidence and Audit Programs 55
71. The following financial data have been extracted from the
records of Blackwell Wholesale Tires:
2003 2002
Required:
SOLUTION:
2003 2002
TRAMWAY ENTERPRISES
Bank Reconciliation
12/31/2003
SOLUTION: