15.

Which of the following is not one of the concepts in the

framework of auditing theory?

a. Evidence

b. Ethical conduct

c. Fair presentation

d. Conflict of interest

16. To raise the standards of the profession, the Philippine

Accountancy Act of 2004 requires that the CPA profession be

integrated under the rules to be established by

a. The PICPA.

b. The Board of Accountancy.

c. The Professional Regulation Commission.

d. The Government Association of CPAs.

17. Management assertions are

a. Stated in the footnotes to the financial statements.

b. Provided to the auditor in the assertions letter, but are not

disclosed in the financial statements of the entity.

c. Implied or express representations about the

accounts in the financial statements.

d. Explicitly expressed representations about the financial

statements.

18. In performing a financial statement audit, which of the

following would an auditor least likely consider?

a. Internal control.

b. Compliance with GAAP.

c. Fairness of the financial statement amounts.

d. Quality of management’s business decisions.

19. When the CPA is not independent, the CPA is precluded from

issuing a
a. Review report.

b. Compilation report.

c. Tax planning report.

d. Management advisory report.

20. The risk that the auditor will fail to uncover a material

misstatement is eliminated

a. If client has effective internal control.

b. If client follows PFRS.

c. When the auditor has complied with PSA.

d. Under no circumstances.

21. No matter how competent a CPA may be, his opinion on

financial statements will be of little value to those who rely on

him unless he

a. Issues an unqualified opinion

b. Maintains his independence.

c. Maintains a program of continuing education

d. Serves his clients with professional concern of their best

interests.

22. An audit can have a significant effect on

a. Business risk.

b. Information risk.

c. The risk-free interest rate.

d. All of these.

23. In government auditing, the three elements of expanded

scope auditing are

a. Goal analysis, audits of operations, audit of systems.

b. Financial and compliance, economy and efficiency,

program results.

c. Pre-audit, post-audit, internal audit.

d. National government audit, local government audit,

corporation audit.

24. Which of the following types of audits are most similar?

a. Operational audits and compliance audit.

b. Internal audits and independent financial statement audits.

c. Independent financial statement audits and operational

audits.

d. Compliance audits and independent financial

statement audits.

25. If it is probable that the judgment of a reasonable person

would have been changed or influenced by the omission or

misstatement of information, then the information is

a. Relevant.

b. Pervasive.

c. Material.

d. Significant.