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5. Regardless of the assessed level of control risk, an auditor would perfom some: (a) Dual purpose tests to evaluate both the risk of monetary misstatement (b) Tests of controls to determine their effectiveness. (d) Substantive tests to restrict detection risk for significant transaction and preliminary control risk. (c) Analytical procedures to verify the design of controls. 6. A proper segregation of duties requires that an individual: Authorizing a transaction also maintain custody of the asset that resulted from the transaction. Authorizing a transaction also record it. Recording a transaction not compare the accounting record of the asset with the asset itself Maintaining custody of an asset be entitled to access the accounting records for the asset. (a) (b) (c) (d) 7. Which of the following audit evidence could least likely be obtained from a review of a corporation's board of directors' minutes? (a) The issuance of bonds and stocks during the year. (b) Dividends declared by the corporation. (c) The amount of major borrowings from financial institutions during the year. Salaries of middle managers within the organization. (d) 8. Which of the following does not impair a CPA's independence? (a) (b) (c) (d) The CPA is a university faculty member who audits the student government fund. The CPA performs the duties of a transfer agent or a registrar for a client The CPA participates as the treasurer of a charitable organization who is a client. The client is in bankruptcy and has not paid fees related to the previous year's audit. The AICPA Code of Professional Conduct would be violated if a CPA accepted a fee for services and the fee was: (a) Based on a price quotation submitted in competitive bidding. (b) Payable to the CPA performing a review of financial statements after 9. a specified finding was attained. (c) Fixed by a public authority (d) Based on the results of judicial proceedings in a tax matter

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