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Audit Theory Quiz 1
Audit Theory Quiz 1
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1
This is the distinguishing mark of the accountancy profession as noted in the 2018 Code of Ethics
Acceptance of the responsibility to act in the public interest
Ability to sign audit reports of clients in various industries
Competence and capability to execute and conform with standards
Satisfaction of the needs of an individual client
2
Which of the following is not considered an assertion as formulated by the Auditing Standards Board?
Valuation or Allocation
Presentation and Disclosures
Mathematical Accuracy
Rights and Obligations
3
Which of the following is not an element of an assurance engagement?
Practitioner
Suitable Criteria
Appropriate Subject Matter
Conclusive Evidence
4
The primary purpose of an independent financial statement audit is to:
Assure management that the FS are unbiased and free from material error.
Comply with state and federal regulatory requirements.
Provide a basis for assessing management's performance.
Give users an unbiased opinion on the fairness of data reported in the FS
5
To comply with relevant laws and regulations and avoid any conduct that will discredit the profession
Professional Behavior
Integrity
Independence
Professional Competence and Due Care
6
What threat might be created when a professional accountant regularly takes a customer or supplier to a sporting event?
Familiarity Threat
Intimidation Threat
Self-Interest Threat
Self-review Threat
7
A professional accountant shall not be knowingly associatedwith information that the accountant believes to
Represent reasonable and fair presentation
Omits or obscures optional information
Contains materially false or misleading statement
Relate to entities with going concern issues
8
Independent auditing can best be described as a
Discipline that attests to results of accounting, other operations and data
Branch of accounting.
Regulatory function that prevents the issuance of improper fin. info.
Professional activity that measures financial and business data
9
Which of the following is not one of the specified objectives of the Accountancy Act of 2004?
The supervision, control, and regulation of the practice of accountancy
Integration of the practice of accountancy
The examination for registration of certified public accountants
The standardization and regulation of accounting education
10
The number of nominees for each position in the Board to be submitted by the APO is
Three
One
Seven
Five
11
All of the followings are qualifications of applicants for the Philippine CPA examinations. Which one is not?
Must be a holder of the degree of Bachelor of Science in Accountancy
Must not be convicted of any criminal offense involving moral turpitude
Must be of good moral character
Must be a resident citizen
12
The primary goal of the CPA in performing the attest function is to
Determine whether the client's assertions are fairly stated.
Examine individual transactions so that the auditor certify its validity
Assure the consistent application of correct accounting procedures.
Detect fraud.
13
Which of the following types of audits are most similar?
Internal audits and independent financial statement audits.
Compliance audits and independent financial statement audits.
Independent financial statement audits and operational audits.
Operational audits and compliance audits.
14
Internal audit provides an audits of efficiency, effectiveness, and _____
Compliance
Evaluation
Accuracy
Internal control
15
A typical objective of an operational audit is to determine whether an entity's
FS present fairly the results of the operations
FS fairly present financial position, result of operations, and cash flows
Specific operating units are functuning effectively and efficiently
FS fairly present financial position and cash flows
16
The Professional Regulatory Board of Accountancy of the Philippines created under Republic Act No. 9298
FRSC
PRC
BOA
PICPA
17
The single feature that most clearly distinguishes auditing, attestation, and assurance is
Training required to perform the services
Type of Service
CPA's approach to the service
Scope of Services
18
What framework does an auditor use to assess the fairness of a company's financial statements?
Information System Control
Generally accepted accounting principles
Generally accepted auditing standards
Internal Control
19
The APO shall submit its nomination with complete documentation to the Commission not later than _____
120 days
90 days
60 days
30 days
20
The following actions shall be taken if professional accountant identifies a breach of the provisions of the Code except
Take whatever actions to address the consequences
End the employment or engagement immediately
Evaluate the impact of the breach on compliance with fundamental principle
Determine whether to report it to relevant parties
