Faculty of Management Science

Student’s Full Name: ………………………….. Father’s Name ………………. Date ..…/……/…..

Student’s ID: ……………………………………………… Session ………………………………….

ACADEMIC YEAR PROGRAM DURATION PROFESSOR NAME

2013 – 2014 Bachelor / Master 1 Hours Mr. Sajid Iqbal

SUBJECT/MODULE: Fundamentals of Auditing and Assurance

Marks Obtained Remarks
Question 1 : (5 Points)
Question 2 : (5 Points)
Question 3 : (10 Points)
Question 4 : (40 Points)
Question 5: (40 Points)
Total: 100 Points

BREAKDOWN:
Particulars Marks Obtained Remarks
Class Participation
Mid-Term Examination
Final Examination
Total

ATTESTATION:
Lecturer’s Signature ………………………………….
Invigilators:
(a) Signature..................................................................
(b) Signature …………………………………….……

INSTRUCTIONS AND REMINDERS

1. Please attempt all the questions.
2. All the candidates are required to comply with the university’s examination policies and
regulations.
3. Any academic misconduct during the examination (such as plagiarism, cheating, or collusion
with another candidate) will be expelled from the examination room and the examination will be
marked with an automatic zero.
4. Make sure you have 00 pages including this page.
5. All answers should be written in the spaces provided in the exam paper.
6. Students should not carry with them any paper, text, or other material bearing any information
relevant to the exam unless it is an open book exam or certain documents that have been
authorized by the lecturer or invigilator.
7. All mobile phones should be switched off during the examination.
8. The answers for short questions shouldn’t be more than a paragraph.
9. The answers for long questions shouldn’t be less than 1000 words.
10. Case studies and numerical problems should be answered as per instructions or whatsoever
deemed appropriate.

MID TERM
1. Multiple Choice Questions
Overwriting, using ink removers, crossers or whitener’s will lead to NIL scoring.

1. Which one of the following authorities shall fix the remuneration of the auditors usually,
A. Directors
B. Shareholders
C. Company registrar
D. SEC

2. The phrase (Scope of an Audit) refers to which one of the followings?

A. Engagement letters
B. Audit procedures
C. Audit evidence
D. Reasonable assurance

3. The factors that affect reasonable assurance include all of the following EXCEPT:
A. Use of test of controls
B. Interest limitations of accounting and internal control
C. Remuneration of the auditor
D. Persuasive nature of audit evidence

4. The audit which is a review of any part of an entity's operating procedures and methods is known as:
A. Financial statement audits
B. Operational audits
C. Technical Audits
D. Compliance audits

5. Which one of the following is the source document for staff salaries?
A. Approved payrolls
B. Vouchers
C. Accounting statements
D. Cash memos

6. Which one of the following meetings is considered as a 'meeting of directors or management?

A. General meeting
B. Extra ordinary general meeting
C. Board meeting (BOD)
D. Management meeting

7. For better assessing the audit risk, auditor inquires different groups in the organizations EXCEPT:
A. Board of governance and top level management
B. Legal counsel
C. Middle level management
D. Stakeholders

8. Which of the following primary assertions is satisfied when an auditor ensures that there are no unrecorded
assets, liabilities, transactions or events or undisclosed items in the client s financial records?
A. Valuation
B. Completeness
C. Existence
D. All of above

9. IFRS stands for which one of the following?

 A. International Financial Reporting Standards
B. International Financial Recording Systems
C. International Financial Recording Statements
D. International Financial Reporting Systems

10. SEC stands for which one of the following?

A. Securities and Exchange Commission
B. Securities and Exchange Consortium
C. Securities and Exchange Courtesy
D. Securities and Exchange Constitution

11. Which one of the following helps to achieve reasonable assurance about the fairness of financial statements
during an audit process?
A. Audit report
B. Audit evidence
C. Audit engagement
D. Audit program

12. The main object of an audit is ___

A. Expression of opinion over financial statements
B. Detection and Prevention of fraud and error
C. Both
D. Depends on the type of audit

13. Which of the following is not true about opinion on financial statements?
A. The auditor should express an opinion on financial statements.
B. His opinion is no guarantee to future viability of business
C. He is responsible for detection and prevention of frauds and errors in financial statements
D. He should examine whether recognised accounting principle have been consistently

14. if auditor detects an error then –

A. He should inform the management.
B. He should communicate it to the management if it is material
C. The auditor should ensure financial statements are adjusted for detected errors.
D. Both (b) and (c)

15. Professional ethics of auditing requires that the auditor assume that management is
A. reasonably honest
B. Neither honest nor dishonest
C. Not necessarily honest
D. Dishonest unless proved otherwise