Principles Of Auditing & Other Assurance Services
21st Edition
ISBN: 9781259916984
Author: WHITTINGTON, Ray, Pany, Kurt
Publisher: Mcgraw-hill Education,
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Chapter 6, Problem 41OQ
To determine
Select the related topics from Professional standards Topics most applicable to the given transactions.
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To obtain an understanding of a continuing client in planning an audit, an auditor most liky
would; A. Perform test of details of transactions and balances B. Read internal audit reports.
C. Read Specialized industry journals. D. Reevaluate the risks of material misstatement
My question is on auditing where I want to know whether the audit evidence is sufficient and appropriate such as oral representation by management, year end suppliers statement and physical inspection of a non current assets
Financial audit Q&A
What risks that may occur during assertion testing, but cannot be prevented due to the lack of time?
What reports that need to be prepared to find out if there are significant changes in the client?
What is the parties reported by the auditor that are related to the results of the audit reports made?
What terms that must be included in the document prepared by the client?
What is the inspection activities to ensure the shipping or Destination Point in the recording of the financial statements is correct in accordance with the fragments?
The auditor needs to know that the ending balance recorded in the financial statements is appropriate based on evidence of transactions in the company.
What is the audit assertion underlying the vouching procedure?
What is the audit assertion underlying the tracing procedure?
What is the risk that caused by the sample taken by the Auditor does not describe the characteristics of the data from the entire data population?…
Chapter 6 Solutions
Principles Of Auditing & Other Assurance Services
Ch. 6 - Prob. 1RQCh. 6 - Prob. 2RQCh. 6 - Prob. 3RQCh. 6 - Discuss what is meant by the phrase shopping for...Ch. 6 - Prob. 5RQCh. 6 - Prob. 6RQCh. 6 - Prob. 7RQCh. 6 - Prob. 8RQCh. 6 - Prob. 9RQCh. 6 - Prob. 10RQ
Ch. 6 - Prob. 11RQCh. 6 - Prob. 12RQCh. 6 - Prob. 13RQCh. 6 - Prob. 14RQCh. 6 - Prob. 15RQCh. 6 - What is meant by making a proper year-end cutoff?...Ch. 6 - Prob. 17RQCh. 6 - Prob. 18RQCh. 6 - Prob. 19RQCh. 6 - Prob. 20RQCh. 6 - Auditing standards require the auditors to have a...Ch. 6 - Prob. 22RQCh. 6 - Prob. 23RQCh. 6 - Prob. 24QRACh. 6 - Prob. 25QRACh. 6 - Prob. 26QRACh. 6 - Prob. 27QRACh. 6 - Prob. 28QRACh. 6 - Prob. 29QRACh. 6 - Prob. 30QRACh. 6 - Prob. 31QRACh. 6 - Prob. 32QRACh. 6 - Prob. 33QRACh. 6 - Prob. 34QRACh. 6 - Prob. 35QRACh. 6 - Prob. 36QRACh. 6 - Prob. 37QRACh. 6 - Prob. 38AOQCh. 6 - Prob. 38BOQCh. 6 - Prob. 38COQCh. 6 - Prob. 38DOQCh. 6 - Prob. 38EOQCh. 6 - Prob. 38FOQCh. 6 - Prob. 38GOQCh. 6 - Prob. 38HOQCh. 6 - Prob. 38IOQCh. 6 - Prob. 38JOQCh. 6 - Prob. 38KOQCh. 6 - Prob. 38LOQCh. 6 - Prob. 39OQCh. 6 - Prob. 40OQCh. 6 - Prob. 41OQCh. 6 - Prob. 42AOQCh. 6 - Prob. 42BOQCh. 6 - Prob. 42COQCh. 6 - Tracing from source documents to journals most...Ch. 6 - Vouching from journals (or ledgers) to source...Ch. 6 - For each definition (or portion of a definition)...Ch. 6 - Prob. 44PCh. 6 - Prob. 45PCh. 6 - Tammy Potter, a new partner with the regional CPA...
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- Analytical procedures are an important part of the audit process and consist of the evaluation of financial information by the study of plausible relationships among financial and nonfinancial data. Analytical procedures may be done during planning, as a substantive test, or as a part of the overall review of an audit. The following are various statements regarding the use of analytical procedures: Should focus on enhancing the auditor’s understanding of the client’s business and the transactions and events that have occurred since the last audit date Should focus on identifying areas that may represent specific risks relevant to the audit Require documentation in the working papers of the auditor’s expectation of the ratio or account balance Generally use data aggregated at a lower level than the other stages Should include reading the financial statements and notes to consider the adequacy of evidence gathered Not required during this stage Involve reconciliation of…arrow_forwardAs a financial auditor who is auditing long-lived assets, from the income statement, describe two accounts that become your concern and require further examination? Explain why it becomes your concern and explain what kinds of audit procedures you will use in order to further examination of that account?arrow_forwardFinancial Audit Q&A Questions Answer Risks that may occur during assertion testing, but cannot be prevented due to the lack of time. Reports that need to be prepared to find out if there are significant changes in the client. The parties reported by the auditor are related to the results of the audit reports made. Terms that must be included in the document prepared by the client. Inspection activities to ensure the shipping or Destination Point in the recording of the financial statements is correct in accordance with the fragments. The auditor needs to know that the ending balance recorded in the financial statements is appropriate based on evidence of transactions in the company. The audit assertion underlying the vouching procedure. The audit assertion underlying the tracing procedure. The risk caused by the sample taken by the Auditor does not describe the characteristics of the data from the entire data population. The risk that arises because the auditor is unable to find…arrow_forward
- If the group engagement partner decides that the component auditor cannot access sufficient appropriate audit evidence regarding the component of the financial statements audited, what type of modified opinion will they consider issuing? O modified opinion due to GAAP departure O modified opinion due to scope limitation O adverse opinion O modified opinion due to GAAS departurearrow_forwardAnalytical procedures consist of evaluations of financial informationmade by a study of plausible relationships among both financial and nonfinancial data.They range from simple comparisons to the use of complex models involving manyrelationships and elements of data. They involve comparisons of recorded amounts, orratios developed from recorded amounts, to expectations developed by the auditors.a. Describe the broad purposes of analytical procedures.b. When are analytical procedures required during an audit? Explain why auditors useanalytical procedures extensively in all parts of the audit.c. Describe the factors that influence the extent to which an auditor will use the resultsof analytical procedures to reduce detailed tests in meeting audit objectives.*arrow_forwardWhat are the objectives of an audit risk assessment? Explain why a risk assessment performed during audit planning sets the tone for the entire audit engagement. Also comment on how the concept of ‘risk assessment’ might be useful for any accountant at the outset of any assignment, including non-audit work.arrow_forward
- Audit firms may have a standardized audit programs for auditing long-lived assets but auditors must still customize the audit program based on the assement of the risk of material misstatement. Why/how?arrow_forwardPlease access PCAOB Auditing Standard No. 12 "Identifying and Assessing Risks of Material Misstatements" (pcaobus.org). Use this standard to answer each of the questions below. For each answer, document the paragraph(s) in AS No. 12 supporting your answer. a. What types of information does AS No. 12 suggest the auditor should consider when obtaining an understanding of the company and its environment? b. What types of performance measurements might affect the risk of material misstatement? c. What specific issues should be included in the discussion among engagement team members regarding the risk of material misstatement? d. What factors should the auditor consider to determine if a risk is a "significant risk"? e. What guidance is provided about revising the risk assessment as the audit continues?arrow_forwardSpreadsheet software would be most useful for which of the following audit activities?a. Testing internal controls over computerized accounting applications.b. Preparing an audit plan.c. Preparing a comparison of current-year expenses with those from the previous year.d. Drafting a planning memorandum.arrow_forward
- Which of the following is most correct with respect to the use of analytical procedures? Analytical procedures may be used in evaluating balances in the testing O phase as long as the auditor also uses them in assessing the going concern assumption. Analytical procedures must be used throughout the audit. Analytical procedures are performed by studying plausible relationships between financial and nonfinancial data. Analytical procedures used in the testing phase of the audit are primarily O used that the auditor's understanding of the business is improved. direct an auditor's attention soarrow_forwardIn auditing, ____________ is the process of identifying and assessing the risks of material misstatement in the financial statements, allowing auditors to tailor their audit procedures accordingly.arrow_forwardWhich of the following expressions best describes a situation under which the issuance of a report that concludes on the condition of the internal controls of an organization that provides technological services to one of our audit clients (SOC report) is required? It is that situation in which a CPA has been hired to evaluate a. the projected financial statements prepared by the client, to see if the expected results comply with hypothetical assumptions or not. b. the information systems and technologies subcontracted by the client, specifically in what corresponds to criteria of security, availability, integrity, confidentiality and privacy. c. any assertion or area that the client has asked to intervene (subject matter), and do so in accordance with compliance or not, with criteria or principles (against criteria). d. services that help the client maintain their financial independence.arrow_forward
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