MCs from Sir

1.Which of the following is not part of the attest process?

a. Gathering evidence about assertions
b. Proving the accuracy of the books and records
c. Evaluating evidence against objective criteria
d. Communicating the conclusions reached

2.The need for assurance services arises for all of the following reasons except:
a. Potential bias in providing information
b. Closeness between a user and the organization
c. Complexity of the processing payments
d. Remoteness between a user and the organizations

3. It is the risk that the practitioner expresses an inappropriate conclusion when the subject matter
information is materially misstated.
a. Business risk
b. Assurance engagement risk
c. Detection Risk
d. Audit Risk

4.Which of the following criteria is unique to the independent auditor’s report attest function?
a. Independence

5. The characteristics for determining whether the criteria in an assurance engagement are suitable
include the following, except
a. Neutrality
b. Completeness
c. Verifiability
d. Understandability

6.The following are assurance engagements, except

a. reasonable assurance engagement
b. other assurance engagement
c. review engagement
d. tax services

7. Unlike consulting services, an assurance services

a. make recommendations to management
b. report on how to use information
c. report on the quality of information
d. are two-party contracts

8.Assurance services may include which of the following, except?

a. Attesting to financial statements
b. Examination of the economy and efficiency of government
operations
c. Evaluation of a division’s performance for management
d. Engagements to testify in legal proceedings regarding
accounting, auditing, taxation or other matters.

1. Auditing is a systematic process that includes all of the following except:

a. communicatingresultstousers
b. procuring and evaluating evidence
c. providing important managerial decisions for a
client
d. comparing evidence regarding assertions to
certain criteria

2. Broadly defined, the subject matter of any audit consists of:

a. Financialstatements
b. Assertions
c. Economic data
d. Operating data

3.Which of the following are assertions about classes of transactions and events in the financial
statements?
a. Occurrence, cut-off, classification, completeness and accuracy
b. Existence, rights and obligations, completeness and valuation and allocation
c. Occurrence and rights and obligations, completeness, classification and understandability and
accuracy and valuation
d. All of the above

4.Which of the following is an assertion?

a. Astatementmadebymanagementregarding the collectability of accounts receivable.
b. The audit firm’s estimation of the client’s inventory obsolescence.
c. The statement by management regarding the appointment of auditors.
d. The statement by management that the firm will close its branch office because of snow.

5.Assertions are representations of management that are embodied in financial statement

components.They
can either explicit or implicit.Which of these assertions is not about valuation or allocation?
a. Property is recorded at historical cost.
b. Trade A/R in the B/S are stated at NRV
c. N/P in the B/S include all such obligations of the entity
d. Property cost is systematically allocated to
appropriate accounting period

6. Results of the financial statement audit are communicated to users through a(n)
a. Financial statement
b. Written management assertion
c. Audit report
d. None of the above

1. Ethical practice is not the foundation of practice of professional accountants. FALSE

2.To merit public trust and confidence, the professional accountant must convince the public that he will
place public service ahead of personal reward. TRUE

3.A professional accountant in business should neither manipulate information nor use confidential
information for personal gain. TRUE
4.An accountant in public practice should consider when providing any service whether there are
threats to compliance with the fundamental principle. TRUE

1.A primary purpose for establishing a code of conduct within a professional organization is to:
a. Reduce the likelihood that members of the profession will be sued for substandard work.
b. Ensure that all members of the profession perform at approximately the same level of competence.
c. Demonstrate acceptance of responsibility to the interests of those served by the profession.
d. Require members of the profession to exhibit loyalty in all matters pertaining to the affairs of their
organization.

2.Which of the following statements is incorrect about integrity?

a. The principle of integrity imposes the obligation on all professional accountants to be straightforward
and honest in professional and business relationships.
b. Integrity implies fair dealing and truthfulness.
c. A professional accountant should not be associated with reports, returns, communications or other
information that (even an appropriate modified report is provided) contains a false or misleading
statement.
d. None of the above

3. Normally the auditor is not permitted to divulge confidential information obtained from a
client.Which of the following situations would be a violation of this requirement?
a. to respond to the information request of a shareholder.
b. to respond to a quality review request of the BOA.
c. to initiate a complaint with the board of accountancy.
d. to ensure adequate disclosure in accordance with PFRSs.

4.This refers to the threat that a financial or other interest will inappropriately influence the professional
accountant’s judgment or behavior?
a. Self-interest threat
b. Advocacy threat
c. Self-review threat
d. Familiarity threat

5. A CPA, while performing an audit, strives to achieve independence in appearance in order to?
a. Reduce risk and liability
b. Maintain public confidence in the profession
c. Become independent in fact
d. Comply with PSAs

The existence of extreme or unusual negligence, even though there was no intent to deceive or do
harm, is
a. fraud
b. constructive fraud
c. gross fraud
d. ordinary fraud

To succeed in an action against the auditor, the client must be able to show that
a. the auditor was grossly negligent
b. the auditor was fraudulent
c. there is a close causal connection between the auditor's breach of the standard of due care and the
damages suffered by the client
d. there was a written contract

1.A person who is not a citizen of the Philippines shall not be allowed to practice accountancy in the
Philippines unless allowed by BOA/PRC under the rule of reciprocity. TRUE

2.The Board of Accountancy is responsible for investigating violations of RA 9298. TRUE

3.The Board of Accountancy is responsible for the preparation of the contents of the CPA Licensure
Examination. TRUE

4.All registered CPAs are united and integrated through their membership in a one and only registered
and accredited national professional organization that is the PICPA. TRUE

1.The objectives of the Philippine Accountancy Act of 2004 are the following, except:
a. Standardization and regulation of accounting education.
b. Integration of accountancy profession.
c. Examination for registration of certified public accountants.
d. Supervision, control and regulation of the practice of accountancy.

2.The primary duty to enforce the provisions of RA 9298 and its IRR rests with:
a. The PRC
b. The PRC and BOA
c. The BOA
d. The AASC

3.Which of the following is not a requisite in applying for the CPA licensure examinations?
a. Natural-born citizen of the Philippines.
b. Good moral character.
c. Holder of the degree of Bachelor of Science in Accountancy
d. Has not been convicted of any criminal offense involving moral turpitude.

4.The Certificate of Registration issued to successful examinees

a. Is renewable every three years
b. Is renewable every five years
c. Shall bear the signature of the PRC Chairperson
d. Shall remain in full force and effect until withdrawn, suspended or revoked.

5.A CPA Certificate is evidence of

a. Independence as a professional.
b. Basic competence at the time of certification.
c. Membership in the accredited association.
d. Completion of continuing professional education program.

6. How many credit units per hour is (are) earned by a CPA who serves as a resource speaker at a CPD
seminar?
a. 1 CU per hour
b. 3 CU per hour
c. 5 CU per hour
d. 2 CU per hour