The Sarbanes-Oxley Act achieved all of the following except Select one: a. Limits the non-audit services an independent auditor may provide to a registrant. b. Requires regular inspection of audit engagements. c. Established the PCAOB. d. Identifies the FASB as the official source of GAAP for SEC filings.
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The Sarbanes-Oxley Act achieved all of the following except Select one:
a. Limits the non-audit services an independent auditor may provide to a registrant.
b. Requires regular inspection of audit engagements.
c. Established the PCAOB.
d. Identifies the FASB as the official source of GAAP for SEC filings.
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- The creation of the PCAOB by the Sarbanes–Oxley Act has affected both the standards-setting process and the periodic review of the quality ofan audit firm’s work.Required:a. Identify the responsibilities of the AICPA, PCAOB, and SEC in the auditing standards-setting process.b. Which standard(s) provide guidance for the audits of public entities? Which standard(s) provide guidance for the audits of nonpublic entities?c. What role do the AICPA and PCAOB play in the periodic review of the quality of audit firms’ work?Which of the following statements is not true with respect to the responsibility for establishing auditing standards? Multiple Choice The PCAOB issues auditing standards for the audit of issuers, subject to SEC approval. Standards issued by the Auditing Standards Board after 2003 apply to the audits of both issuers and nonissuers. The Auditing Standards Board currently issues auditing standards for the audit of nonissuers. Prior to the Sarbanes-Oxley Act, the Auditing Standards Board issued auditing standards for the audits of both issuers a13. When auditing an entity's financial statements in accordance with Government Auditing Standards (the "Yellow Book"), an auditor is required to report on: I. Recommendations for actions to improve operations. II. The scope of the auditor's tests of compliance with laws and regulations. Group of answer choices I only. II only. Both I and II. Neither I nor II.
- Classify each of the following issues according to whether they will be (1) included in written representations in all audits, (2) included in writtenrepresentations in audits of public entities (under PCAOB standards), or (3) not included in written representations:a. Management acknowledgment of its responsibility for the fairness of the financial statements in accordance with U.S. GAAP.b. A list of pending or threatened litigation, claims, or assessments currently outstanding against the client.c. A description of recommendations that allow the client to improve the efficiency and effectiveness of its operations.d. Availability of all financial records and related data.e. Information related to the presentation and disclosure of items within the financial statements.f. Disclosure of all significant deficiencies and material weaknesses in internal control.g. Information concerning fraud involving management and employees who have significant roles in internal control.h. Auditors’…The main purpose of the auditor's consideration of internal control for a non-SEC client is to A. Develop suggestions for improvements in internal control. C. timing Determine the nature, timing, and extent of substantive tests. C. Express an opinion on the financial statements. D. Determine whether fraud has occurred during the year under audit.The SEC requires the MD&A report as well as the audit attestation on management’s assessment of internal controls. Why was the MD&A report required and how important is this report in facilitating disclosure of financial information? Why is the audit attestation report also an SEC requirement?
- 21)An audit engagement letter A.May not be prepared each period for a recurring audit engagement B.Is prepared for the benefit of the audit, audit client and general public C.Shall include specific audit procedures to be performed by the auditor D.Is usually sent by auditor to the client upon the commencement of the audit 22)The engagement letter A.Can affect legal responsibility to the client B.Can be used to alter the auditor’s responsibilities under the standards on auditing C.Is used only if it is an engagement, but has no effect for review or compilation services D.Affects the CPA firm’s responsibility to external users of audited financial statements 23)Which of the following is notinvolved during pre-planning phase? A.Obtaining information about client’s legal obligation B.Obtaining an engagement letter C.Selecting staff for engagement D.Deciding whether to accept or continue an audit engagement 24)Which of the following matters is least likely to be discussed in an…7. In an audit in accordance with generally accepted auditing standards, the auditors must test compliance with those laws and regulations that: Group of answer choices Have a direct and material effect on the financial statements. Have a direct and material effect on major federal programs. Have a material direct or indirect effect on the financial statements. Have a material effect on major or nonmajor programs.Discuss briefly: (i) The independent auditor’s report describing the scope of the statutory audit. (ii) An audit’s main limitations (iii) The implementation of the overall audit strategy. (iv) How to Understand the entity and its environment (v) The Fundamental principles as they relate to the Duty of confidentiality
- Auditors performing audits under the Single Audit Act issue an opinion on whether the Schedule of Expenditures of Federal Awards is fairly stated in all material respects in relation to the F/S taken as a whole. One reason auditors can issue this opinion is that the data used to prepare the Schedule is derived from the underlying accounting records audited. True or falseUnder preconditions of an audit, the management shall provide the auditor with the following, except: Group of answer choices b. Additional information that the auditor may request from management for the purpose of the audit d. All the above are concerns that management need to provide c. Unrestricted access to persons within the entity from whom the auditor determines it necessary to obtain audit evidence. a. Access to all information of which management is aware that is relevant to the preparation of the financial statements such as records, documentation and other matters;Which of the following statements about the auditor's responsibilities in public company audits is true as covered by the PCAOB? A. The auditor issues an opinion on the financial statements and management issues the opinion on internal control over financial reporting. B. The auditor issues an opinion on the financial statements only if internal control over financial reporting is found to be effective. C. The auditor issues an opinion on the financial statements; if those are found to be fairly stated, the auditor proceeds to issue an opinion on internal control over financial reporting. D. The auditor issues opinions on the financial statements and internal control over financial reporting.