a” , : PAMANTAT” | NG LUNSSOD NG MAYNILA ” DEPARTMENTAL FINAL EXAMINATION ASSURANCE PRINCIPLES AND GOOD GOVERNANCE, 4 AUGUST T2011 GENRTAMINSTRUCTIONS: Pp 1. FOLLOW THE INSTRUCTIONS CAREFULLY. FAILURE ‘TODO SO” Wha. WARRANT A DEDUCTION FROM YOU FINAL RAW SCORF, 2. YOU ARE NOT A. LOWRD TO TALK OR ASK QUESTIONS TO AND FROM YOUR SEATMATE. “LF YOU HAVE ANY Qt TIONS ABOUT TE EXAMS, APPROACH THE PROCTOR QUIETLY. YOU ARE NOT ALLOWED TO LEAVE THE KOOM ONCE THE EXAMINATION 1a STARTED. YOU AME ONLY ALLOWED TO LEAVE THE RYOOM WIEN YOU At HINGED AND HAVE SUNMITTED VOUIL EXAMINATION PAPERS "TO. 1 rrocron, 4. YOU_ARE NOT ALLOWED TO BORROWILEND CALCULATOR AND WRITING MATERIALS, TALKING AND/OR LOOKING AT YOUR CLASSMATES PAPER IS AUTOBIICALLY CONSIDERED CHEATING, ANYBODY CAUGHT CHEATIN: WILL OF RETORTED ‘TO THE OSHS FOR APPROPRIATE ACTION 1. TRUBVOR FALSE ; 7 1 J9 an avatit client hast eousistentty Observed secoiviting pvinelps fn the eurent Period in T relation tothe preceding period, te auditor should worn anexphoivatory paragraph which explains the nature of Te change @) A qualified report is issued whet all auditing conditions havesben amet misstaleinents have been diseavered, and IF the, auditor's qpinion that He. fin 10 ne Gis Tanly Slated Wi accoidonce oth PFRSS “Tests of desails. of balaices ius be designed for-eagh bala = Favorable tesullg from shalytical procedures rece We Ester 1G which The awdITGr needs 0 + TO ea ey Seats C5 The criterion used by mest merchandising ara! manufactring clients for detriniing when a sile takes place is whether title to the goods hs passed. ae 2) For ea ze: be oaaresenctn-lal attic ets te ompines bglasesfalatet-audit objective nea “The balarice-related audit objeptives of realizable value ahd rights are alfected by assess contioltisk. ee 4 - ‘Tests of details of balances focus on testing the year-end balances ‘of balance sheet accousis. 18) Contain oF esoune cette ove evince rite fo the existence assure nd nes chioff objeetines. es + Tw {0} Gonfitration i is the most cont imviees for the accuracy, of decoynts tresable ‘ et if con dered less reliable than sified positive contitmatons agate con ations are ess expensive dls relia, an positive coat mations Ry ‘Peano (oee-a-coibination ‘of postive any] neeillve canfiewatins ty SRE, he r xX later to accounts with largé balancep antl Me RAE Ts be i snall bilaiioes, a 4 Yess of thesrealizabile value balanee-elated aul “are forthe Punose of evaluating AEA git alldwiice for doubirulsezounis : (Ss UlptistepreepllatIBIEe ate ioilred by profesional uliing stalin, wheres * pe ca SCE i Te, TREN Eeridlig coufinatons durfas most ais of aggduns receivable, the exmphasis i"oRen May conte ie ibe en . i {FD wes Elie dee wih nin shoo ving veel enti ean =) ive air shoud ot ak the client to ecole eierence E Ayn ET Bere ; + - EDS Ape Nee i {pn Ls a] wari cf ye LeeFG te scenms renee ate mooi ogi on Reomaareee / z 400) Porm ass proper eco es post Ha ier sce or he, 200, Aw independent review onist he performed af all snadits ible value issuolaallected by the likelihood 1). tawsult hos eon tel agit Yo elea, Vein te oy si lea 7 +0 ‘your elient wll Tore thelnesuit Lee e “ Halal Toes sve a dnny Cte T 1-2 fessional auditing standarclé ypuuire the pertormaikce AF analytical procedures figs complet lee of the mai cd iously Issued financial states ave m -T ae vvesuest thal the el --§financial statements containing ap explanation of ilicsreasans fur. the rev T-r(aeitciscce ot bonds ty heen staequenttoyeaeend smi rere tat aigetosure in, bt no aujustnent tothe THOTT Rake Uer aie mapas ie noLLEWITg tr evant the pong comerrnascuption as pl of exe aa the lier nf rprenetaton is typed on ie tients bterinca fd signet by the Ae sit 10H Tor Ue wnt Co pepe ie eller. Gee gar eng ets a74Current profesional auditing standnots via jceleaSbataavagemeli, net the auditor is ect responsible for kleniilying and decidiny appropriate accoupting treatment for contingent Hinbiities, ee JAC the comipletinn of the audit, mansy.ensent is typically an art ofthe engngement Ie ais we af no ulisclosed cont Wel preparing a standout inyuiry ofctiens attorney leter the fc ae ce tay aa lerhend should be 5 oficials, $e PO} a stander inquiry of clients aoney ler, the atoney fs esested to communicate ‘about comthigeineh& Tp To We ha . MULAIPLE Cligice @ voINTs EACH) s ‘i 8 to he I$ uaa correeiatntement cepading ihe allyeaslon, of the preliminary juda : ialeetgccounis) === Oy fe i eis have wi insane thaw ther, vy eC ABE” “Theallgentton her virally 9 elect auc sate enone the ar Hat oes suet ofa hil evidence reso : ni overstate aswell te nteritenien i the seen aifect the alles asi 2. Mite nuit of hail ci] sates, wich of he following acount hanes the Hiss “EPivlippine Siondatds of Auditing +B: Cis basié of accounting. Philippiné Financial Reporting § a. Professional Regulation Commission a Which one of the following is more, difficull lo cy cq NE "Presehation of financial sitoneH in Aecordande with PRS. 1b, Conipliance with governent regulations. at “6 Benebetigy aid bffectiveltets of opétations. ' pea three of the above ite ‘equally difficult 4... Which ot the following ent be signticantly atfééted by au audit RE A banc be Inforination tisk... ET viskefice interest rate, BX dee inhetentiisk Vat pansinwtied | i #a A 55. the fet ha the aor is dependent. a r ;sieve Sones? 6 Comvany Shareholders” Hoard of Directors ‘a Yes Yes Ar, He Yes © Yes No 4 No No the aittor evalvates the erect of m change ina < ting principle, the materiality of ¥ » the change should > evatyaed base ov . Pao + the prior yenrs presented 4% thseynent year effect ofthe change ©. guidelines incl in PSAS3¢ 8." theeeffect on total asses When the avelitor concludes that there is substénitie cloubl shout the entity's abiliiy 1 continue as a going eonrent, the approjiriate audit repos’ v auld be: 4A gine option with an explanatory paragr p bea disclaimer of opinion. e._ neither a nor b. ad” eitheraorh, : os renee 8. + Which ot the folowing is n61 a primary category of atte dation report? a Compilation report: pRets perm! : ‘ An Review wpa RCW ee GEG eee 5 Se Audit report i 4. ‘Specs at ey basen a sis of accu ting vther than GAAP, Habe eat Et Be 563 9. Will esnect to fis menis of untouits i ho a Ne je ve Gg a 9 Lac Signiennt accounting estates involving subjective judg h Facentive presume fo narmgentem to meet Jet repayment reqsitements, xe + 87 Manageménts procice of making very aggrensve fot eaes. High mover of accu W “The auditor's tesls to understand the client internal conivuls might include which of the follwing west gemer A Leanne. be tio - No * "ode, No ves required by PFRSs Bde tepleauy race ‘ - e. required by the BIR me a“ Teesinmended bythe 13, “The esenee ofan efectively controled éxehnizaton les in th: a. effectiveness OTHE INP UNENCSEUET FL a i effectiveness of interna aude c _ alfitude of ils employees: sya os mngene"i ¥ fy 2 ; VE) ht titer eet Mh oie oleinantan cre seta? 7 +m Buteatic reorder points fy sow watesnis iventty Te Avsatre manner © avdorization fy a sales yetur oo Se Coe tnt oe var chases estos manic tov toni 15. Wepnpose of a ly ag and conyyinarionsystenuingy —- Record awd ? o 2 Monitor « , ey * 16, Themostetetivesip ore and er ain A, "©, atten dt ae crates ac ent ane tt englneéson a al aot To Rain monn epi dene ne en cee eet teats done nr etames uroratone Hoey 2 eee haemo of eine 18 Aindtors nay Kent conan dri ldo tot change duppe a judgment sbow he iva Ae ea ae oka, Which ofthe lowing snot a eis whieh should ale a aoe ae _-- Melt poseernet shoul! be cai cam : [be Tv bts nck orga ede A teetpanctes fi agen tongs 2 Os Undine reteionahipe betiee the aude sd ingsinent A ieee rene tae y 19. Which of the fottowing is least like: Aouuneouer-fraud? att Ae “ Pee ee a Verde pena hive 08 ofa é Thee 2 eticcov et) ae 2 eo Intra conta tL sugy ace UE ERE & ce ©) Mamie iia den aii followin 8a ly rc neal acess ad sks? ctf ong nai team mem. ‘ot fimagement : ‘Analticol procera sa, Coacldcration af fiaud risks disnovered ig fvent Midis OF Uther clients, 27 On) ray nl wa te ig se ies eine sgt is |) apafedgeot.an-eventocsincumtange. «Sane een t, Seneie ete SS net Declarative . & — ntervogative aes nforenational . i2%, «sift els en of contlssopper th sg al peas of cots exec Ue rao, ' Deere Fie the wenn wssessmen ; ar aower ' GR these : ealigh : : Oiler tower oF ies o : 2A. 4 Which of the following fs coment? Nano deteney Tenens anal wens q D ae aecl eliiency i always materiel wethness © vnoentns enya ijt cots! die: 4. AL REREIW ala}s msgnilcehdeTelency. a5, whieh of the Ttowing snot «Rhy prizadore to sup the cerns eect often consti? me D se teuiry oFelfent pessomnel. 7 ONS Bee atom a ent retated ativits So Mepetamnee of it ocedres Bega intel conto qvesionnaire feral eontras. sie one is not void? Dp He oe ey GL Gonugt proses eosonny ening a lai rag enposees cml ICE, eee Jatingement's philesopiry and eperating style ee covet? or aeration mute ow car te Daca io net nlae pice! wits Barua etn is necconry aMiugh it ena oe acetetr ny of decane Tne 29, Theps tras over: tg classes of transactions. aoe 6---aecount balances: So th an ,beeause they ae egal ingore Sana and bbecause they vary frm elit to cen ty emplasis by auditors 1 08 0. The independent aor shold aos an umiersane ‘othe intial mit Fonetion as i retes 1 Te rete yden eis sty and evetation of teat ‘conte pecause the Bee ogres, working, papers wl feats Wecnat muitos. enn often be used a8 & | ‘QR acer ew of pes sia" | Tet yey the ea aah ete the indeyendentautors 4 t rovers Peni tidy aa venation oneal conte Nitesnining the nakure. ining. and ae entnned by kneral ris muy Pe # Ur G Rreworthe independent waders peocedune’ a eiliming of he neal ait agin i. vant substantive tet tobe performed ty the independent ser. A 1. Shera annette erg mus an os TA tit tiffs of an Hert y Earn renter sors ine ey on V6 WN? oe ‘ 7 ab sity fe _Competence Tle All of the aboveAd - ng eat the auditors sess level uf eo ned hy using actunial tables, eho ated by using the auul risk inoue fe an eeununie issue, Wading off the costs of testing control balances, ‘calculated by using the Formulas provided inthe AICPA"S ating standaeds rol risk is aginst the est of testing when wedltdnenting conn existe Weflbze Tro a. is ho longer # concem heemwseriheie Ts no longst a signiivant deficiency of nvaterial m ertnes. bisa anni cancer othe ator could enue a matress, sme be ete uring stantv€ proces {1 feranpifen nd mst be renee! ro the sping cess nnd cxansined ns emnety ‘After considering a elie’ intemal, contr, an nuditor has cfnctuded Usa it is well designed an! is “fiction ng as fnfended, Under these ciemustances the miitor wet moet Wkely ‘a. perform tests of control lo'the extent dufined in the avait progr Ih. determine the control rocedhres that should prévent of dete etrors an ieregulavition. Y « LSM wot increase the extent of predetermined Substantive tests.” Fd. deteriine whether tnnsactious’afe recorded to permit prepacatio ‘oF financial statements in Peontoriity wis generally accepted aceowneing principles. A to ola an midestanding of an city’s tonto environment, ay audit showld corcentate on the {tsianve of managerent paliies and proces athe thow tet oun beers Jee Nianagoment ney etelish sopcat plies md yroceves but not ae on then ‘the boerd of aiecins nay ot bevayere of managements atte toward he contol viidnnent the miter ay been th * entity. «rine potcts and procedures nny be a weak that wo flies come the policies ant procedures nre inappropriate for thet rticuloe ned by the auditor sin co TH DN G ROL LOW SS, 6