Which of the following statements best describes why an auditor would use only substantive procedures to...
Which of the following statements best describes why an auditor would use only substantive procedures to evaluate specific relevant assertions and risks?
Multiple Choice
-
The relevant internal control components are not well documented.
-
The internal auditor already has tested the relevant controls and found them effective.
-
The cost of substantive procedures will exceed the cost of testing the relevant controls.
-
Testing the operating effectiveness of the relevant controls would not be efficient.
Homework Answers
The correct answer is:-
d) Testing the operating effectiveness of the relevant controls would not be efficient.
Add Answer to:
Which of the following statements best describes why an auditor
would use only substantive procedures to...
1.Which of the following is not one of the steps the auditor must perform to assess...
1.Which of the following is not one of the steps the auditor must perform to assess control risk at less than “high” for a financial statement assertion? A) obtain an understanding of internal control B) identify controls that address all relevant assertions in the financial statements C) make a preliminary assessment of control risk based on the design of relevant controls D) test the operating effectiveness of the controls that must be effective to reduce control risk 2.Which of the...
Which of the following is a false statement about the assessment of the risks of material...
Which of the following is a false statement about the assessment of the risks of material misstatement? A. The assessed levels will affect the nature, timing, and extent of substantive testing. B. The auditor may use certain tests of details of transactions concurrently as tests of controls. C. The ultimate purpose is to determine the operating effectiveness of controls. D. The auditor’s understanding of internal control should be documented.
Which of the following matters would an auditor most likely consider to be a significant deficiency to be communicated to the audit committee
1. Which of the following matters would an auditor most likely consider to be a significant deficiency to be communicated to the audit committee? A. Management's failure to renegotiate unfavorable long-term purchase commitments.B. Recurring operating losses that may indicate going concern problems.C. Evidence of a lack of objectivity by those responsible for accounting decisions.D. Management's current plans to reduce its ownership equity in the entity. 2. After obtaining an understanding of internal control and arriving at a preliminary assessed level...
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...
10. Which of the following ratios, used in analytical review would not assist the auditor in...
10. Which of the following ratios, used in analytical review would not assist the auditor in planing ee audit? A. Gross profit margin B. Inventory turnover C. Receivables collection period D. Earnings per share 11. In which of the following stages of audit, would it be inap propriate to conduct an analytical review? A. Audit completion 8. Substantive testing C. Compliance testing D. Audit planning 12. Which of the following statements are true in respect of detection risk? 1) If...
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...
These questions are from Brony's Bike module-2 11. Which of the following procedures would the auditor...
These questions are from Brony's Bike module-2 11. Which of the following procedures would the auditor perform in testing the completeness assertion for accounts payable? SelectExamine a sample of cash disbursements made after year end to determine whether the disbursements were for goods applicable to the previous year.Reconcile vendor's statements with the accounts receivable trial balance.Examine production equipment for useful lives.Gather purchase orders immediately previous to and subsequent to year-end.Item 11 12. An auditor may best test commissions expense for...
1. Which of the following best describes what is meant by corporate governance? Multiple Choice The...
1. Which of the following best describes what is meant by corporate governance? Multiple Choice The organizational structure and responsibilities of the executive team and board of directors of a corporation. Regulatory bodies, such as the SEC and PCAOB, that govern the behavior of corporations. The ability of a corporation’s management team to meet earnings forecasts over an extended period of time. Management’s processes, policies, and ethical approach to safeguarding stakeholder interests. 2. Which of the following is not included...
1.Which of the following statements is TRUE: i) Internal audit’s role is to assess if financial...
1.Which of the following statements is TRUE: i) Internal audit’s role is to assess if financial statements are true and fair ii)External auditors are responsible for the identification of all fraud iii)Internal auditors report their audit opinions to shareholders a)i and ii only b)i and iii only c)ii and iii d)None of the above 2.Ruby, an external auditor, has been asked by the Finance Director of Aberdeen Ltd. if she will be the company’s external auditor. Before agreeing to the...
13 of 19 Which of the following best descnibes a dual purpose test? O a Performing...
13 of 19 Which of the following best descnibes a dual purpose test? O a Performing two substantive tests at the same time b. Performing testwork over two significant accounts at the same time O c. Performing two tests of controls at the same time O d Perfor 14 of 19 Which of the following statements about internal controls is correct? O a Controls are actions taken by management to prevent or detect and correct material misstatements O b. Effective...
10. Which of the following ratios, used in analytical review would not assist the auditor in planing ee audit? A. Gross profit margin B. Inventory turnover C. Receivables collection period D. Earnings per share 11. In which of the following stages of audit, would it be inap propriate to conduct an analytical review? A. Audit completion 8. Substantive testing C. Compliance testing D. Audit planning 12. Which of the following statements are true in respect of detection risk? 1) If...
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...
13 of 19 Which of the following best descnibes a dual purpose test? O a Performing two substantive tests at the same time b. Performing testwork over two significant accounts at the same time O c. Performing two tests of controls at the same time O d Perfor 14 of 19 Which of the following statements about internal controls is correct? O a Controls are actions taken by management to prevent or detect and correct material misstatements O b. Effective...
Most questions answered within 3 hours.
-
(Expected rate of return and risk) Carter Inc. is evaluating a
security. Calculate the investment’s expected...
asked 1 hour ago -
What specific indicators can point to lack of progress for
African Americans in American society?
asked 2 hours ago -
1-The Electrons in a beam are moving at 2.7×108 m/s in an
electric field of 15000...
asked 2 hours ago -
A gas tank is a vertical cylinder. It has a radius of 1m, a
height of...
asked 3 hours ago -
Accent Software faces the following conditions. All of these
support Accent’s use of a market-penetration pricing...
asked 4 hours ago -
A mathematically inclined friend emails you the following
instructions: "Meet me in the cafeteria the first...
asked 4 hours ago -
A monopoly sells in two countries . The demand curves in the two
countries are p1...
asked 5 hours ago -
A .15kg rubber ball is bounced off a wall. Before hitting the
wall, the ball moves...
asked 5 hours ago -
A manufacturing company preparing to build a new plant is
considering three potential locations for it....
asked 5 hours ago -
B. If compound Y has approximately the same values of solubility
in toluene as compound X,...
asked 6 hours ago -
Oscar Inc. has inventory in Japan valued at 39,051,000 Yen one
year ago. One year ago...
asked 6 hours ago -
If Canada suffered from "fundamental disequilibrium," and its
government choose not to devalue its currency, a...
asked 6 hours ago