Professional Documents
Culture Documents
Audit Reports
MULTIPLE CHOICE:
1.
2.
3.
232
ANSWER:
4.
5.
6.
ANSWER:
7.
9.
8.
233
234
10.
11.
12.
13.
c.
d.
ANSWER:
14.
16.
15.
235
236
17.
18.
19.
237
21.
22.
After issuing the audit report, the auditor may become aware
of information that would have affected the audit report had
it been known at the time. Given discovery of such
information, the auditor must take appropriate action. Which
of the following actions would be considered inappropriate
under these circumstances?
238
d.
ANSWER:
23.
24.
239
26.
240
28.
29.
241
ANSWER:
31.
32.
33.
242
ANSWER:
34.
35.
36.
ANSWER:
37.
38.
243
244
d.
ANSWER:
40.
a.
b.
c.
d.
ANSWER:
42.
Restrictions on the
scope of the
audit
Yes
No
Yes
No
245
44.
46.
Explicitly
Implicitly
45.
Implicitly
Explicitly
246
47.
49.
Explicitly
Implicitly
Explicitly
Implicitly
48.
Explicitly
Implicitly
Implicitly
Explicitly
Auditor's
responsibility
ANSWER:
50.
247
of
c.
d.
public companies.
Determine accounting principles for the purpose of
financial reporting by companies offering securities to
the public.
Require a change of auditors of governmental entities
after a given period of years as a means of ensuring
auditor independence.
ANSWER:
51.
248
Inconsistent.
Prepared in accordance with another comprehensive basis
of accounting.
Misleading
Affected by a material uncertainty.
ANSWER:
53.
54.
55.
249
COMPLETION:
56.
57.
SCOPE
58.
59.
ADVERSE
62.
61.
SUBSEQUENT EVENT
60.
SCOPE, OPINION
INTRODUCTORY
250
63.
64.
DISCLAIMER OF
66.
CONTINUING
65.
EMPHASIS OF A MATTER
EMPHASIS OF A MATTER
MATCHING:
67. From the following types of audit reports, select the one
that best fits each of the listed situations. A given selection
may be used once, more than once, or not at all.
A.
B.
C.
D.
E.
F.
_____1.
251
_____3.
_____4.
_____6.
_____7.
_____8.
252
_____9.
E
A
A
C
B
F
D
F
F
A
PROBLEM/ESSAY
68. Jonathon Hershey, CPA, is the senior auditor for Web Stores,
Inc., a company that markets products on the Internet. The
current year-end is January 31, 2003. Last year's audit report
contained an explanatory paragraph because of doubt regarding the
ability of Web Stores to continue as a going concern. The
company had defaulted on two major loan agreements, and appeared
to be losing the race to develop a solid commercial presence on
the Internet. Since the date of last year's audit report,
however, company management has changed. A new advertising
campaign and innovative marketing techniques, have proven
successful. Creditors have agreed to major debt restructuring
agreements, and the client appears to be "out of the woods."
Required:
253
254