The following are types of management assertions in the financial statements that an auditor must evaluate
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The following are types of management assertions in the financial statements that an auditor must evaluate
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- 1 The following are types of management assertions in the financial statements that an auditor must evaluate Question 1 options: a) Valuation b) Completeness c) Accuracy d) All of the aboveWhich of the following factors do NOT impact the auditor's decision on the mix of substantive procedures to be performed? O overall risk assessment for the client O nature of the account balance O management's opinion on the risk of the account balance O risk assessment for the specific account balanceWhich of the following does NOT describe substantive procedures? O includes inspection, inquiry, and confirmation O also known as substantive testing or tests of details O influenced by the overall risk assessment O designed to obtain indirect evidence of information included in the financial statements
- Which of the following situations violates the concept of reliability? Relevance is the capacity of information to make difference in decision by helping users from predictions about outcome of past, present and future events, or confirm/correct prior expectations The quality of reliability assures readers that the financial information is free from bias and faithfully represents what it purports to show, including adequate disclosure of significant information Under the IASB Framework for the Preparation and presentation of financial statements, conservatism is not a concept that is recognized as a qualitative objective I and II only II and III only I and III only I, II and IIIHow would an auditor test the realizable value audit objective fora financial instrument classified as a level 3 fair value estimate?The performance of an attestation engagement on prospective financial information does not require which of the following?a. If the basis of the prospective financial information is different from the financial statements, a reconciliation of the two must be provided.b. Management must disclose all significant assumptions used in generating the prospective financial information.c. Management must disclose significant accounting policies and procedures used in generating the prospective financial information.d. Management must disclose the probability of obtaining the results included in the prospective financial information.
- Which of the following is the best description of reliability in relation to information in financial statements? Comprehensibility to users Influence on the economic decisions Freedom from material error and bias Inclusion of degree of caution of usersWhat are the five types of tests auditors use to determine whether financial statements are fairly stated? Identify which tests are performed to reduce planned detection risk.Which of the following services provides the lowest level of assurance on a financial statement Select one: a. Neither service provides assurance on financial statements b. review c. Each service provides the same level of assurance on financial statements d. audit
- Which of the following statements about materiality is incorrect? the preliminary assessment of materiality guides audit planning and testing materiality is used to guide the validity of information contained in the financial report materiality is a key auditing concept that is assessed during the planning stage of every audit information is considered material if it has no impact on the decision-making process of financial report usersUsers of financial statements have a different perception concerning the nature of auditors’ services than the actual objectives of an audit. This difference is known asa. Diverse liability perception.b. Reasonable foreseeable third parties. c. Insurance hypothesis.d. Expectations gap.When evaluating audit findings, the auditor should consider any potential bias in management's judgement. Which if the these is not included in an auditor's concerns. 1. Management's bias in estimation calculations 2. Management's bias in accounting policies 3. Management's bias in detection risk 4. Management's bias in adjusting entry calculations