Auditing MCQs

A. When it constitutes entire population

B. When it is enough to provide a basis for giving reasonable assurance regarding truthfulness

C. When it is objective and relevant

D. When auditor collects and evaluates it independently

A. They document the level of independence maintained by the auditor

B. They should be considered as the principle support for the auditor’s report

C. They should not contain details regarding weaknesses in the internal control system

D. They help the auditor to monitor the effectiveness of the audit firm’s quality control

A. The reliability of audit evidence and its relevance in meeting the audit objective

B. The objectivity and integrity of the auditor

C. The quantity of audit evidence

D. The independence of the source of evidence

A. The assessed level of control risk

B. The possibility of peer review

C. The nature of auditor’s report

D. The content of management representation letter

A. Randomly

B. Disproportionately

C. Directly

D. Inversely

A. For the time period the entity remains a client of the audit firm.

B. For a period of ten years

C. For a period auditor opines them to be useful in servicing the client

D. For the period the audit firm is in existence.

A. May be eliminated for an account balance under certain conditions

B. Are designed to discover significant subsequent events

C. Will increase proportionately when the auditor decreases the assessed level of control risk

D. May be test of transactions, test of balance and analytical procedures

A. Extracts from client’s bank statements

B. Past year’s financial statements

C. Attorney’s letters

D. Debt agreements

A. To be reliable, evidence should conclusive rather than persuasive

B. Effective internal control system provides reliable audit evidence

C. Evidence obtained from outside sources routed through the client

D. All are correct.

A. To provide a basis for review of audit work

B. To provide a basis for subsequent audits

C. To ensure audit work is being carried out as per programme

D. To provide a guide for advising another client on similar issues