100. ……………….. Starts where …………….. Ends
A. Accounting, auditing
B. Auditing, accounting
C. Vouching, auditing
D. Accounting,vouching
✅ The correct answer is option B.
101. Inspection report/receiving report supports entries in
A. Sales book and sales return book
B. Purchase book and sales return book
C. Cash book and purchase book
D. Sales book and purchase return book
✅ The correct answer is option B.
102. While observing a client’s annual physical inventory, an auditor conducted test counts for certain test counts were higher than the recorded quantities in the client’s perpetual records. This situation could be the result of the client’s failure to record –
A. Purchase returns
B. Sales returns
C. Goods with consignor
D. Purchase discounts
✅ The correct answer is option B.
104. When counting cash on hand the auditor should ___
A. Ensure presence of somebody from management
B. Obtain a receipt from custodian as to its return
C. Ensure postage and revenue stamps are not counted in physical count
D. Temporary advances to employees are counted to calculate balance of cash in hand
✅ The correct answer is option C.
106. Which of the following statements is not true with regard to teeming and lading ?
A. It results in the deliberate misappropriation of cash receipts
B. It is associated with cash receipts
C. If same individual maintains cash receipts and cash payments teeming and lading is likely to exist
D. To conceal the shortage, the defraud, usually, tries to keep bank and book amounts in daily agreement so that a bank reconciliation will not detect the irregularity.
✅ The correct answer is option C.
109. When an independent auditor relies on the work of an internal auditor, he or she should
A. Examine the scope of internal auditor’s work
B. Examine the system of supervising review and documentation of internal auditor’s work
C. Adequacy of related audit programme
D. all of the above
✅ The correct answer is option D.
110. In comparison to the independent auditor, an internal auditor is more likely to be concerned with
A. Cost accounting system
B. Internal control system
C. Legal compliance
D. Accounting system
✅ The correct answer is option B.
112. The independence of an internal auditor will most likely be assured if he reports to the
A. President Finance
B. President System
C. Managing Director
D. CEO
✅ The correct answer is option C.
94. The performance of tests of control is documented in
A. Audit programme
B. Flow charts
C. Working papers
D. Any of the above
✅ The correct answer is option C.
96. A flow chart, made by the auditor, of an entity’s internal control system is a graphic representation that depicts the auditor’s.
A. Understanding of the system
B. Understanding of fraud risk factors
C. Documentation of assessment of control risk
D. Both (a) and (c)
✅ The correct answer is option A.