Auditing And Assurance Services
17th Edition
ISBN: 9780134897431
Author: ARENS, Alvin A.
Publisher: PEARSON
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Question
Chapter 13, Problem 22.2MCQ
To determine
Identify the option which is the primary objective of performing tests of controls.
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Tests of controls in a GAAS audit are required fora. Obtaining evidence about the financial statement assertions.b. Accomplishing control over the occurrence of recorded transactions.c. Applying analytical procedures to financial statement balances.d. Obtaining evidence about the operating effectiveness of client control activities.
In a financial statement audit, the auditor obtains a reasonable level of assurance about whether the financial statements are free of material misstatement in order to express an opinion. In order to obtain reasonable assurance, the auditor must
have prior experience in the industry in which the audit client operates.
examine all documents available that support the financial statements.
obtain sufficient audit evidence.
test controls around significant transaction cycles.
The auditor should assess control risk for each relevant assertion by evaluating the evidence obtained from all sources, includinga. The auditor’s testing of controls for the audit of internal control on a public company.b. Misstatements detected during the financial statement audit.c. Any control deficiencies identified during the audit.d. All of the above.
Chapter 13 Solutions
Auditing And Assurance Services
Ch. 13 - Prob. 1RQCh. 13 - Prob. 2RQCh. 13 - Prob. 3RQCh. 13 - Prob. 4RQCh. 13 - Prob. 5RQCh. 13 - Prob. 6RQCh. 13 - Explain how the calculation and comparison to...Ch. 13 - Prob. 8RQCh. 13 - Prob. 9RQCh. 13 - For each of the eight types of evidence discussed...
Ch. 13 - Prob. 11RQCh. 13 - Prob. 12RQCh. 13 - Prob. 13RQCh. 13 - Prob. 14RQCh. 13 - Prob. 15RQCh. 13 - Prob. 16RQCh. 13 - Prob. 17RQCh. 13 - Prob. 18RQCh. 13 - Prob. 19RQCh. 13 - Prob. 20RQCh. 13 - Prob. 21.1MCQCh. 13 - Prob. 21.2MCQCh. 13 - A conceptually logical approach to the auditors...Ch. 13 - Prob. 22.1MCQCh. 13 - Prob. 22.2MCQCh. 13 - Prob. 22.3MCQCh. 13 - Prob. 23.1MCQCh. 13 - b. Substantive analytical procedures are most...Ch. 13 - Prob. 23.3MCQCh. 13 - Prob. 24DQPCh. 13 - Prob. 25DQPCh. 13 - Prob. 26DQPCh. 13 - Prob. 27DQPCh. 13 - Prob. 28DQPCh. 13 - Prob. 29DQPCh. 13 - Prob. 30DQPCh. 13 - Prob. 31DQPCh. 13 - Prob. 32DQPCh. 13 - Prob. 33DQPCh. 13 - Prob. 34DQPCh. 13 - Prob. 35DQP
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- The external auditor should fulfill several performance responsibilities in order to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement . Among these responsibilities is Select one : a. providing an opinion on the financial statements . b. exercising professional judgment. verifying that all audit work is performed by the auditor with a minimum of three years ' experience . d. Accumulating sufficient , appropriate audit evidence.arrow_forwardO LO 2-4 Wren, Inc., a nonpublic company, retains Ying and Company CPA to audit its financial statements and internal control. Sarah Smith, the senior on the audit prepared the following first draft of an unmodified report: 2-33. Page 69 Independent Registered Auditor's Report (Comment a) To the Board of Directors and Management of Wren, Inc. (Comment b) Phoenix, AZ 85011 Opinion We have audited the financial statements of Wren, Inc., which comprise the balance sheet as of December 31, 20X1, and the related statements of income, changes in stockholders' equity, and cash flows for the year then ended, and the related notes to the financial statements. In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of Wren, Inc. as of December 31, 20X1, and the results of its operations and its cash flows for the year then ended in accordance with Financial Accounting Standards Board (Comment c) accounting principles generally…arrow_forwardAuditors obtain reasonable assurance that financial statements are fairly stated by performing all of the following except: Evaluating the materiality of misstatements detected. Determining whether internal control can be relied upon to prevent/detect misstatements. Performing substantive tests to detect misstatements. Establishing strong systems of internal control.arrow_forward
- When auditors become aware of noncompliance with a law or regulation committed byclient personnel, the primary reason that the auditors should obtain a better understanding ofthe nature of the act is toa. Recommend remedial actions to the audit committee.b. Evaluate the effect of the noncompliance on the financial statements.c. Determine whether to contact law enforcement officials.d. Determine whether other similar acts could have occurred.arrow_forwardUnder 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;arrow_forward
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