70.2K

Verified Solution

Link Copied!

1725. Multiple Choice Questions - Thank you in advance for answering them all - if you cant please leave for someone else to answer.

a. A material departure from generally accepted accounting principles will result in auditor consideration of: (1) Whether to issue an adverse opinion rather than a disclaimer of opinion. (2) Whether to issue a disclaimer of opinion rather than a qualifi ed opinion. (3) Whether to issue an adverse opinion rather than a qualifi ed opinion. (4) Nothing, because none of these opinions is applicable to this type of exception.

b. The auditors report should be dated as of the date the: (1) Report is delivered to the client. (2) Auditors have accumulated suffi cient evidence. (3) Fiscal period under audit ends. (4) Peer review of the working papers is completed. c. In an audit report on combined fi nancial statements, reference to the fact that a portion of the audit was performed by a component auditor is: (1) Not to be construed as a qualifi cation, but rather as a division of responsibility between the two CPA fi rms. (2) Not in accordance with generally accepted auditing standards. (3) A qualifi cation that lessens the collective responsibility of both CPA fi rms. (4) An example of a dual opinion requiring the signatures of both auditors. d. Assume that the opinion paragraph of an auditors report begins as follows: With the explanation given in Note 6, . . . the fi nancial statements referred to above present fairly. . . This is: (1) An unmodifi ed opinion. (2) A disclaimer of opinion. (3) An except for opinion. (4) An improper type of reporting. e. The auditors who wish to draw reader attention to a fi nancial statement note disclosure on signifi cant transactions with related parties should disclose this fact in: (1) An emphasis-of-matter paragraph to the auditors report. (2) A footnote to the fi nancial statements. (3) The body of the fi nancial statements. (4) The summary of signifi cant accounting policies section of the fi nancial statements. f. What type or types of audit opinion are appropriate when fi nancial statements are materially and pervasively misstated? Qualifi ed Adverse (1) Yes Yes (2) Yes No (3) No Yes (4) No No g. Which of the following ordinarily involves the addition of an emphasis-of-matter paragraph to an audit report? (1) A consistency modifi cation. (2) An adverse opinion. (3) A qualifi ed opinion. (4) Part of the audit has been performed by component auditors. h. An audit report for a public client indicates that the audit was performed in accordance with: (1) Generally accepted auditing standards (United States). (2) Standards of the Public Company Accounting Oversight Board (United States). (3) Generally accepted accounting principles (United States). (4) Generally accepted accounting principles (Public Company Accounting Oversight Board). i. An audit report for a public client indicates that the fi nancial statements were prepared in conformity with: (1) Generally accepted auditing standards (United States). (2) Standards of the Public Company Accounting Oversight Board (United States). (3) Generally accepted accounting principles (United States). (4) Generally accepted accounting principles (Public Company Accounting Oversight Board).

j. When the matter is properly disclosed in the fi nancial statements, the likely result of substantial doubt about the ability of the client to continue as a going concern is the issuance of which of the following audit opinions? Unmodifi ed with Qualifi ed Emphasis-of-Matter (1) Yes Yes (2) Yes No (3) No Yes (4) No No k. A change in accounting principles that the auditors believe is not justifi ed is likely to result in which of the following types of audit opinions? Unmodifi ed with Qualifi ed Emphasis-of-Matter (1) Yes Yes (2) Yes No (3) No Yes (4) No No l. Which of the following is least likely to result in inclusion of an emphasis-of-matter paragraph in an audit report? (1) The company is a component of a larger business enterprise. (2) An unusually important signifi cant event. (3) A decision not to confi rm accounts receivable. (4) A risk or uncertainty.

Answer & Explanation Solved by verified expert

See Answer