1-When assessing the risk of material misstatements in the financial statements, A.inadequate internal control procedures will...
1-When assessing the risk of material misstatements in the financial statements,
A.inadequate internal control procedures will mitigate client business risk.
B.GAAS specifies in detail how much and what types of evidence the auditor needs to obtain.
C.company management is responsible for determining materiality levels.
D.the auditor must understand the client's business and industry.
Homework Answers
Answer is (D) the auditor must understand the client's business and industry.
A is incorrect because inadequate internal control procedures do not mitigate client business risk.
B is incorrect because how much evidence auditor needs to obtain is left at the descretion of auditor.
C is incorrect because the auditor determines the materiality levels.
D is correct because the auditor has to understand the client's business and industry.
Add Answer to:
1-When assessing the risk of material misstatements in
the financial statements,
A.inadequate internal control procedures will...
1. One of the initial steps in the audit process is to obtain a _______ that...
1. One of the initial steps in the audit process is to obtain a _______ that is used as an agreement between a CPA firm and a client for the conduct of an audit and related services. a)10-Q filed with the SEC b)Assessment report c)Audit and risk report d)Engagement letter 2. An auditor must consider both acceptable audit risk and inherent risk when planning an audit. These two types of risk affect the: a)Amount of evidence that needs to be...
1.An auditor has just prepared and sent a letter to management detailing weaknesses in internal control....
1.An auditor has just prepared and sent a letter to management detailing weaknesses in internal control. A copy of this letter should be ________. -placed in the temporary file, and removed when the client corrects the deficiencies -filed with the Securities and Exchange Commission -sent to the client’s attorney -placed in the permanent file 2.What do auditors consider when determining the extent to which the internal auditors’ work will affect the auditors’ procedures? -The materiality of the account balance or...
1. Consider the following statements: I. Per COSO, Control Activities are the policies and procedures...
1. Consider the following statements: I. Per COSO, Control Activities are the policies and procedures that help insure that management’s directives are carried out. II. A Reliance Strategy is used when control risk is considered High. a. I is true; II is true b. I is true; II is false c. I is false; II is true d. I is false; II is false 2. Management's attitude toward aggressive financial reporting and its...
These are more choices to choose from. John Josephs, an audit manager for Tip, Acanoe &...
These are more choices to
choose from.
John Josephs, an audit manager for Tip, Acanoe & Tylerto, was asked to speak at a dinner meeting of the local Small Business Administration Association. The president of the association has suggested that he talk about the various phases of the audit process to help small business owners better understand what auditors do. John has asked you, his trusted assistant, to prepare an outline for his speech. He suggests that you answer the...
executed 6) An contingiation established The primary purpose for establishing the code of A) Outline criteria...
executed 6) An contingiation established The primary purpose for establishing the code of A) Outline criteria for professional behavi o . honesty, dignity within the association B) Establish standards to follow for effective C) Provide a framework within which accounting polic e offeydded D) Outline criteria that can be utilized in conducting o n www 7) While assessing the risks of material misstatement is Wentify w i th could go wrong, consider the magnitude of risks, and A) Assess the...
Question 13 When control risk is deemed high, the auditor should: (Select the correct answer.) a....
Question 13 When control risk is deemed high, the auditor should: (Select the correct answer.) a. Perform sufficient and appropriate substantive procedures that reduce detection risk to a low level. b. Perform sufficient and appropriate substantive procedures that reduce inherent risk to a low level. c. Perform fewer sufficient and appropriate substantive procedures in order to increase detection risk. d. Resign from the audit engagement. Question 14 An auditor determines that management integrity is high, the RMM is low, and...
Using the audit risk model, state the effect on control risk, inherent risk, acceptable audit risk,...
Using the audit risk model, state the effect on control risk, inherent risk, acceptable audit risk, and planned evidence for each of the following independent events. In each of the events cirlce one letter for each of the three independent variables and planned evidence: I=increase, D=decrease, N= no effect, and C= cannot determine from the information provided. A. The client's management materially decreased long-term contractual debt: Control risk IDNC Acceptable audit risk IDNC Inherent risk IDNC Planned evidence IDNC B....
Chapter 7:Internal Control Question1: Because of the Inherent inconsistency of automated controls, auditors will test them...
Chapter 7:Internal Control Question1: Because of the Inherent inconsistency of automated controls, auditors will test them at various times in the year to determine their operating effectiveness. True False Question2: A correct response by management to an assessment of risk could include taking no action because the risk is consistent with the risk tolerance of the organization. True False Question3: A primary objective of procedures performed to obtain an understanding of internal control is to provide an auditor with Knowledge...
1. All invoices received by a Company subsequent to the yearend but that have not been...
1. All invoices received by a Company subsequent to the yearend but that have not been entered into the financial records as of the date of testing are tested to determine if they were accrued in the financials as of yearend. Answer the following questions: A. Relevant assertion: 1. Existence 2. Occurrence 3. Completeness 4. Presentation 5. Valuation B. This is an example: 1. Vouching 2. Tracing C. It addresses the following risk(s): 1. Expenses are not recorded although incurred...
Parker is the in-charge auditor for the upcoming annual audit of FGH Company, a continuing audit...
Parker is the in-charge auditor for the upcoming annual audit of FGH Company, a continuing audit client. Parker will supervise two assistants on the engagement and will visit the entity before the fieldwork begins. Parker has completed the engagement letter and established an understanding with the Chief Internal Auditor on the assistance to be provided by the internal audit function. Which of the following activities should be considered as preliminary engagement and planning activities? (Select all that apply.) Reading the...
These are more choices to
choose from.
John Josephs, an audit manager for Tip, Acanoe & Tylerto, was asked to speak at a dinner meeting of the local Small Business Administration Association. The president of the association has suggested that he talk about the various phases of the audit process to help small business owners better understand what auditors do. John has asked you, his trusted assistant, to prepare an outline for his speech. He suggests that you answer the...
executed 6) An contingiation established The primary purpose for establishing the code of A) Outline criteria for professional behavi o . honesty, dignity within the association B) Establish standards to follow for effective C) Provide a framework within which accounting polic e offeydded D) Outline criteria that can be utilized in conducting o n www 7) While assessing the risks of material misstatement is Wentify w i th could go wrong, consider the magnitude of risks, and A) Assess the...
Most questions answered within 3 hours.
-
Core Concepts of Accounting Information Systems
Discussion Question #4
Does a company have the right to...
asked 1 minute ago -
Why does the Solow model cannot explain growth in the long run?
What is the role...
asked 3 minutes ago -
Question 8 Interactive LearningWare 26.2 offers a review of the
concepts that play roles in this...
asked 8 minutes ago -
draw product of cyclohex-2-en-1-one, Sodium methoxide and
hydronium workup
asked 16 minutes ago -
In a certain state, about 65% of drivers who are arrested for
driving while intoxicated (DWI)...
asked 17 minutes ago -
A single NEC SX-9 vector processor unit (VPU) has a peak
arithmetic
performance of 102.4 GFs/s....
asked 35 minutes ago -
. Determine the hourly multiplication factors
such that the total daily water consumption will equal 15,000...
asked 36 minutes ago -
A budgeting Web site reported that 35% of U.S. households have
withdrawn money from a 401(k)...
asked 35 minutes ago -
In this assignment, you will write a minimum two-page paper that
explains the treatment of internal...
asked 39 minutes ago -
Direct marketing is also referred to as Question 50 options: 1)
one-to-one marketing. 2) business-customer marketing....
asked 42 minutes ago -
INK Ltd is grocery retailer with 103 shops around South
Australia and Tasmania. The company has...
asked 47 minutes ago -
HOW BEER IS MADE
The beer making process is an art. It takes time, patience and...
asked 48 minutes ago