In an audit sampling application, an auditora. Performs procedures on all items in a balance and makes a conclusion about the entirebalance.b. Performs procedures on less than 100 percent of the items in a balance and formulates aconclusion about the entire balance.c. Performs procedures on less than 100 percent of the items in a class of transactions tobecome familiar with the client’s accounting system.d. Performs analytical procedures on the client’s unaudited financial statements when planning the audit.

When applying analytical procedures during an audit, which of the following is the best approach for developing expectations? Multiple Choice Considering the pattern of several unusual changes without trying to explain what caused them. Considering unaudited account balances and ratios to calculate what adjusted balances should be. Comparing client data with client determined expected results to reduce detailed tests of account balances. Comparing current year account balances to balances of one or more comparable periods.

The following questions concern types of audit tests.Choose the best response.a. The auditor looks for an indication on duplicate sales invoices to see whether theaccuracy of invoices has been verified. This is an example of(1) a test of details of balances. (3) a substantive test of transactions.(2) a test of control. (4) both a test of control and a substantivetest of transactions.

State with reasons (in short) whether the following statements are correct or incorrect (a) The terms of audit engagement can restrict the scope of an audit. · (b) It is the function of an audit to establish that payments have been made validly to the persons who are shown to be recipients. (c) Letter of Representations received from Management relieve the auditors of their responsibility. (d) Stratified sampling method involves dividing the whole population to be tested in a few separate groups. (e)  There is a very thin difference between advocacy threats and intimidation threats to an auditor while performing his duty