Concept explainers
a.
Introduction: Internal audit control is the procedure performed by an auditor to determine the controlling efficiency of an organization so that accurate financial reporting can be ensured.
To indicate: The type of audit that will be suitable for given action and the type of auditor who may best perform it.
b.
Introduction: Internal audit control is the procedure performed by an auditor to determine the controlling efficiency of an organization so that accurate financial reporting can be ensured.
To indicate: The type of audit that will be suitable for given action and the type of auditor who may best perform it.
c.
Introduction: Internal audit control is the procedure performed by an auditor to determine the controlling efficiency of an organization so that accurate financial reporting can be ensured.
To indicate: The type of audit that will be suitable for given action and the type of auditor who may best perform it.
d.
Introduction: Internal audit control is the procedure performed by an auditor to determine the controlling efficiency of an organization so that accurate financial reporting can be ensured.
To indicate: The type of audit that will be suitable for given action and the type of auditor who may best perform it.
e.
Introduction: Internal audit control is the procedure performed by an auditor to determine the controlling efficiency of an organization so that accurate financial reporting can be ensured.
To indicate: The type of audit that will be suitable for given action and the type of auditor who may best perform it.
f.
Introduction: Internal audit control is the procedure performed by an auditor to determine the controlling efficiency of an organization so that accurate financial reporting can be ensured.
To indicate: The type of audit that will be suitable for given action and the type of auditor who may best perform it.
g.
Introduction: Internal audit control is the procedure performed by an auditor to determine the controlling efficiency of an organization so that accurate financial reporting can be ensured.
To indicate: The type of audit that will be suitable for given action and the type of auditor who may best perform it.
h.
Introduction: Internal audit control is the procedure performed by an auditor to determine the controlling efficiency of an organization so that accurate financial reporting can be ensured.
To indicate: The type of audit that will be suitable for given action and the type of auditor who may best perform it.
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Chapter 2 Solutions
EBK AUDITING & ASSURANCE SERVICES: A SY
- Auditing includes all of the following except:a. A systematic process.b. An objective obtaining and evaluating evidence concerning assertions about economic actions andevents.c. Ascertain degree of correspondence between assertions and financial statements.d. Communicate audit results to interested users. The following are the three types of audits according to subject matter, excepta. Financial statements auditsb. Operational auditsc. Compliance auditsd. External audits The following are the three types of audits according to auditor, excepta. External auditsb. Internal auditsc. Governmental auditsd. Performance audits The following statements relate to auditing in general. Which is false?a. Compliance audits and independent financial statement audits are similar in nature.b. Evaluating the efficiency and effectiveness—which depends on how they are defined—of operationsof an entity is subjective.c. Both a and bd. Neither a nor barrow_forwardIn planning the audit, an auditor takes three basic steps in determining the audit procedures to be performed for any business cycle or class of transactions in order to gather audit evidence concerning possible misstatement due to error or fraud. List those three basic steps below.arrow_forwardWhere the auditor should summarize the overall audit strategy that contains the key decisions about the scope, timing and conduct of the audit a. Audit plan b. Memorandum c. Audit working papers d. Audit Note bookarrow_forward
- The auditor should consider audit risk when planning and performing an audit of financial statements. Audit risk should also be considered together in determining the nature, timing, and extent of auditing procedures and in evaluating the results of those procedures. Required: a. Define audit risk b. Describe the components of audit risk (e.g., inherent risk, control risk, and detection risk). c. Explain how these components are interrelatedarrow_forwardAn audit plan is : a. The blueprint for conducting the audit and accomplishing the audit objectives. b. The flowchart for conducting the audit and accomplishing the audit objectives. c. The footprint for conducting the audit and accomplishing the audit objectives. d. The gannchart for conducting the audit and accomplishing the audit objectives.arrow_forwardThe auditor should consider audit risk when planning and performing an audit of financial statements. Audit risk should also be considered together in determining the nature, timing, and extent of auditing procedures and in evaluating the results of those procedures. Required: a. Define audit risk. b. Describe the components of audit risk (e.g., inherent risk, control risk, and detection risk). c. Explain how these components are interrelated. (AICPA, adapted)arrow_forward
- The following are procedures to obtain audit evidence except: a. Physical examination. b. Organization. c. Confirmation. d. Analytical procedures.arrow_forwardFor each of the procedures described in the table below, identify the audit procedure performed and classification of the audit procedure using the following: (Each of the "Audit Procedures" and "Classification of Audit Procedure" may be used once, more than once, or not at all.) Audit Procedures: Classification of Audit Procedure: (1) Analytical procedure (9) Substantive procedures (2) Confirmation (10) Test of controls (3) Inquiry (4) Inspection of records or documents (5) Inspection of tangible assets (6) Observation (7) Recalculation (8) Reperformance For each of the procedures described in the table below, identify the audit procedure performed and classification of the audit procedure using the following: (Each of the "Audit Procedures" and "Classification of Audit Procedure" may be used once, more than once, or not at all.) Audit Procedures: Classification of Audit Procedure: (1) Analytical procedure (9) Substantive…arrow_forwardFor each of the procedures described in the table below, identify the audit procedure performed and classification of the audit procedure using the following: (Each of the "Audit Procedures" and "Classification of Audit Procedure" may be used once, more than once, or not at all.) Audit Procedures: Classification of Audit Procedure: (1) Analytical procedure (9) Substantive procedures (2) Confirmation (10) Test of controls (3) Inquiry (4) Inspection of records or documents (5) Inspection of tangible assets (6) Observation (7) Recalculation (8) Reperformance Procedure Audit Procedure Classification of Audit Procedure a. Requested responses directly from customers as to amounts due. b. Compared total bad debts this year with the totals for the previous two years. c. Questioned management about likely total uncollectible accounts. d. Watched the accounting clerk record the daily deposit of cash receipts.…arrow_forward
- Which of the following audit is a continuous process ? Risk Management Internal Audit Balance Sheet Preparation External Auditarrow_forwardd) Name the four types of tests auditors normally perform in an audit after risk assessment is done.arrow_forwardDescribe the audits and auditors ingovernmental, internal, and operationalauditing.arrow_forward
Auditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage Learning
Auditing: A Risk Based-Approach to Conducting a Q...AccountingISBN:9781305080577Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:South-Western College Pub