AUDITING
During the course of the audit of Datexx, you wish to achieve a low level of audit risk on an engagement. Inherent risk related this portion of the audit is considered at the maximum. While obtaining an understanding of this portion of the internal control structure of Datexx, you have determined that it appears to be very strong. Nonetheless, due to the large number of transactions involved, the auditors have chosen not to test controls in the area.
Describe the scope of tests of controls that will be performed. Thanks.
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Ch.11 Discussion topic As you probably read in the chapter as well as in my ch.11...
Ch.11 Discussion topic As you probably read in the chapter as well as in my ch.11 lecture notes, understanding the control risk assessment flow chart would be crucial not only for studying ch.11 Internal Control Assessment topics, but also would be critical to have a solid conceptual framework for the entire audit process. In your own words and understanding, list and explain briefly the phases/ steps of a control evaluation of a client's internal control system-it's design, placement, and operating...
Review Garcia and Foster’s calculations of materiality thresholds for the 20X2 Audit . Determine if the...
Review Garcia and Foster’s calculations of materiality
thresholds for the 20X2 Audit . Determine if the auditors correctly
applied the materiality concept in their risk assessment
procedures. Describe any problems you find and provide suggestions
for improvement. This question relates to step 2 of the Garcia and
Foster Audit Plan.
Step 2: Requires the audit team to obtain and document its
understanding of the client’s environment including internal
controls. This understanding allows auditors to identify
significant risks in the audit...
Discussion Topic: When performing an audit, auditors are especially concerned about engagement risk. For this reason,...
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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...
Which of the following matters would an auditor most likely consider to be a significant deficiency to be communicated to the audit committee
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1. A CPA has accepted an engagement in which inquiry and analytical procedures are the primary...
1. A CPA has accepted an engagement in which inquiry and analytical procedures are the primary procedures to be performed. These procedures will form the basis for issuance of: A) A compilation report B) Audit report on supplemental information issued by the client C) An agreed-upon procedures report D) Review report on financial statements for a nonpublic company 2. Auditors frequently use analytical procedures as substantive tests, but this is not required by auditing standards. A) True B) False 3....
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...
Statements Answer 1. The term relates to the quantity of evidence that the auditors should obtain....
Statements Answer 1. The term relates to the quantity of evidence that the auditors should obtain. The amount of evidence that is considered sufficient varies with the reliability of the evidence. The risk of material misstatement is composed of two risks that the auditor assesses, those risks are inherent risk and risk. 4. Tests of controls and are referred to as "further audit procedures." The audit approach of evaluating financial statement information by a study of relationships among financial and...
need all the answers just answers 6. Analytical procedures are most likely to detect: a. Weaknesses...
need all the answers just answers
6. Analytical procedures are most likely to detect: a. Weaknesses of a material nature in internal control b. Unusual transactions. c. Noncompliance with prescribed control activities, d. Improper separation of accounting and other financial duties. able 7. Wecepting an balance statement unting sieni managem 7. Which of the following should the auditors obtain from the predecessor auditors before accepting an audit engagement? a. Analysis of balance sheet accounts. b. Analysis of income statement accounts...
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...
Ch.11 Discussion topic As you probably read in the chapter as well as in my ch.11 lecture notes, understanding the control risk assessment flow chart would be crucial not only for studying ch.11 Internal Control Assessment topics, but also would be critical to have a solid conceptual framework for the entire audit process. In your own words and understanding, list and explain briefly the phases/ steps of a control evaluation of a client's internal control system-it's design, placement, and operating...
Review Garcia and Foster’s calculations of materiality
thresholds for the 20X2 Audit . Determine if the auditors correctly
applied the materiality concept in their risk assessment
procedures. Describe any problems you find and provide suggestions
for improvement. This question relates to step 2 of the Garcia and
Foster Audit Plan.
Step 2: Requires the audit team to obtain and document its
understanding of the client’s environment including internal
controls. This understanding allows auditors to identify
significant risks in the audit...
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...
Statements Answer 1. The term relates to the quantity of evidence that the auditors should obtain. The amount of evidence that is considered sufficient varies with the reliability of the evidence. The risk of material misstatement is composed of two risks that the auditor assesses, those risks are inherent risk and risk. 4. Tests of controls and are referred to as "further audit procedures." The audit approach of evaluating financial statement information by a study of relationships among financial and...
need all the answers just answers
6. Analytical procedures are most likely to detect: a. Weaknesses of a material nature in internal control b. Unusual transactions. c. Noncompliance with prescribed control activities, d. Improper separation of accounting and other financial duties. able 7. Wecepting an balance statement unting sieni managem 7. Which of the following should the auditors obtain from the predecessor auditors before accepting an audit engagement? a. Analysis of balance sheet accounts. b. Analysis of income statement accounts...
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