AUDITNTING THEORY

Part – 11

1. An independent audit aids in the communication of economic data because the audit.
a. Lends credibility to the financial statements
b. Confirms the accuracy of management’s financial representation
c. Guarantees that the financial data are fairly presented
d. Assures the readers of financial statements that any fraudulent activity has been
corrected

2. Inherent limitations in an audit stem from the following factors except;

a. Use of testing
b. Incompetence of the auditor
c. Internal control limitation
d. Most audit evidence is persuasive rather than conclusive

3. In financial statements audits, the audit should be conducted in accordance with

a. PAS/PFRS
b. Generally accepted auditing standards
c. Philippine Standard on Auditing
d. Code of ethics for CPA’s in the Philippines