When inherent and control risks are high, acceptable detection risk needs to be low to reduce audit risk to________. When inherent and control risks are low, an auditor can accept a higher detection risk and still reduce audit risk to___________.
Correct
Incorrect
Question 2 of 30
2. Question
1 points
Standards on Auditing require that ___________ discuss the susceptibility of the entity’s financial statements to material misstatement.
Correct
Incorrect
Question 3 of 30
3. Question
1 points
Risks of material misstatement at the overall financial statement level refer to risks of material misstatement
Correct
Incorrect
Question 4 of 30
4. Question
1 points
Which of the following statement is correct?
Correct
Incorrect
Question 5 of 30
5. Question
1 points
When inherent and control risks are high, acceptable detection risk needs to be
Correct
Incorrect
Question 6 of 30
6. Question
1 points
Assertions sued by the auditor to consider the different types of potential misstatements in relation to transactions occurred during the year include:
Correct
Incorrect
Question 7 of 30
7. Question
1 points
Policies and procedures that help ensure that management directives are carried out are known as:
Correct
Incorrect
Question 8 of 30
8. Question
1 points
Which of the following is not a component of internal control system?
Correct
Incorrect
Question 9 of 30
9. Question
1 points
There are a number of specific elements that usually contribute to a successful control environment and which may be used as indicators of the quality of the control environment of a particular organisation. Which of the following is not one of the these elements?
Correct
Incorrect
Question 10 of 30
10. Question
1 points
The preliminary assessment of control risk includes all the following procedures except:
Correct
Incorrect
Question 11 of 30
11. Question
1 points
Process to asses the effectiveness of internal control performance over time is known as:
Correct
Incorrect
Question 12 of 30
12. Question
1 points
The most emphasis by auditors is placed on understanding which of the following types of controls?
Correct
Incorrect
Question 13 of 30
13. Question
1 points
Judgement a materiality are made in light of surrounding circumstances, and are affected by the_________of a misstatement, or a combination of both.
Correct
Incorrect
Question 14 of 30
14. Question
1 points
Judgments about materiality are made in the light of surrounding circumstances, and are affected by:
Correct
Incorrect
Question 15 of 30
15. Question
1 points
Which of the following might be a commonly used guideline related to a financial statement materiality base?
Correct
Incorrect
Question 16 of 30
16. Question
1 points
The auditor’s determination of materiality is a matter of_____________, and is affected by the auditor’s perception of the financial information needs of users of the F.S.
Correct
Incorrect
Question 17 of 30
17. Question
1 points
The concept of materiality is applied by the auditor in___________the audit & in evaluating the effect of identified misstatements on audit and of uncorrected misstatements, if any, on the F.S. and in forming the opinion in auditor’s report.
Correct
Incorrect
Question 18 of 30
18. Question
1 points
Performance materiality means the amount or amounts set by the auditor at,________ materiality for the financial statements as a whole, a reduce to an appropriately low level, the probability that the aggregate of uncorrected and undetected misstatements, exceeds materiality for the financial statements as a whole.
Correct
Incorrect
Question 19 of 30
19. Question
1 points
SA 320 on “Materiality in planning and performing an audit” requires that an auditor should consider materiality and its relationship with__________while conducting an audit.
Correct
Incorrect
Question 20 of 30
20. Question
1 points
Misstatements, including omissions, are considered to be material if, individually or in the aggregate:
Correct
Incorrect
Question 21 of 30
21. Question
1 points
As per SA 330, which of the following factors do not warrant retesting of controls:
Correct
Incorrect
Question 22 of 30
22. Question
1 points
As per SA 330, external confirmations may be used as substantive procedure. Areas in which external conformations may be obtained are:
Correct
Incorrect
Question 23 of 30
23. Question
1 points
In the context of an audit of financial statements, substantive tests are audit procedures that
Correct
Incorrect
Question 24 of 30
24. Question
1 points
Substantive procedures comprise of:
Correct
Incorrect
Question 25 of 30
25. Question
1 points
The auditor’s primary consideration is whether, and how, a specific control prevents, or detects and corrects:
Correct
Incorrect
Question 26 of 30
26. Question
1 points
When deviations from controls upon which the auditor intends to rely are detected, the auditor shall make specific inquiries to understand these matters and their potential consequences, and shall determine whether:
Correct
Incorrect
Question 27 of 30
27. Question
1 points
When substantive procedures are performed at an interim date, the auditor shall cover the remaining period by performing:
Correct
Incorrect
Question 28 of 30
28. Question
1 points
In the course of audit of Z Ltd, its auditor wants to rely on audit evidence obtained in previous audit in respect of effectiveness of internal controls instead of retesting the same during the current audit.
Correct
Incorrect
Question 29 of 30
29. Question
1 points
The auditor’s decision on whether to rely on audit evidence obtained in previous audits for controls that: (a) have not changed since they were last tested; and (b) are not controls that mitigate a significant risk; is a matter of professional judgment. In addition, the length of time between retesting such controls is also a matter of professional judgment, but is required to be at least
Correct
Incorrect
Question 30 of 30
30. Question
1 points
Determining materiality involves the exercise of professional judgment. A percentage is often applied to a chosen benchmark as a starting point in determining materiality for the financial statements as a whole. Factors that may affect the identification of an appropriate benchmark include the following:
Correct
Incorrect
Ekvij provides MCQ Tests For CA,CMA and CS examinations