Académique Documents
Professionnel Documents
Culture Documents
NAME: _____________________________
PROFESSOR: _______(acctg12 prof)______
3. A CPA firm offers management advisory services to clients. Its primary purpose is to
a. Furnish professional advice and assistance which will enable the client to improve operations.
b. Keep the CPA firm competitive with other firms.
c. Establish the firm as a consultant, thus ensuring its future expansion and growth.
d. Permit the firm’s staff members to acquire expertise in other areas of practice.
4. The government agency tasked by law of implementing and enforcing the regulatory policies of the national
government with respect to the regulation and licensing of the various professions and occupations under its
jurisdiction is
a. PRC b. BOA c. COA d. SEC
6. In the absence of pronouncements issued by the ASPC and the PICPA, published statements and guidelines issued
by other authoritative bodies like AICPA, IAASB and AFA are the bases of determining generally accepted auditing
standards (GAAS). What effect do these pronouncements provide in determining the GAAS?
a. Authoritative b. Persuasive c. Parallel d. Alternative
9. The risk of not detecting a material misstatement resulting from fraud is higher than the risk of not detecting a
material misstatement resulting from error because
a. The effect of fraudulent act is likely omitted in the accounting records.
b. Fraud is ordinarily accompanied by acts specifically designed to conceal its existence.
c. Fraud is always a result of connivance between or among employees.
d. The auditor is responsible to detect errors but not fraud.
10. Which of the following statements describes why a properly designed and executed audit may not detect a
material fraud?
a. Audit procedures that are effective for detecting an unintentional misstatement may be ineffective for an
intentional misstatement that is concealed through collusion.
b. An audit is designed to provide reasonable assurance of detecting material errors, but there is no similar
responsibility concerning material fraud.
c. The factors considered in assessing control risk indicated an increased risk of intentional misstatements, but only a
low risk of unintentional errors in the financial statements.
d. The auditor did not consider factors influencing audit risk for account balances that have pervasive effects on the
financial statements taken as a whole.
12. Which of the following is an engagement attribute for an audit of an entity that processes most of its financial
data in electronic form without any paper documentation?
a. Discrete phases of planning, interim, and year-end field work.
b. Increased effort to search for evidence of management fraud.
c. Performance of audit tests on a continuous basis.
d. Increased emphasis on the completeness assertion.
14. The risk that the assertion contains material misstatements that, when aggregated with misstatements in other
assertions, could make the entire financial statements materially misstated is:
a. Individual audit risk b. Inherent risk c. Control risk d. Detection risk
15. Incremental risk is the increased risk that errors may not be detected at the balance sheet date because:
a. Audit procedures were performed at an interim date
b. Inherent risk was assessed too low.
c. Analytical procedures were not performed.
d. Detection risk was set too high a level.