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    Mcqs Auditing

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    medkwn.pbt
    This document contains 225 multiple choice questions related to auditing topics such as test checking, materiality, analytical procedures, audit evidence, substantive testing, audit risk, and audit planning. The questions cover concepts addressed in auditing assurance standards and include topics like internal controls, documentation, sampling, and management representations.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Mcqs Auditing

    Uploaded by

    medkwn.pbt
    4 views6 pages
    This document contains 225 multiple choice questions related to auditing topics such as test checking, materiality, analytical procedures, audit evidence, substantive testing, audit risk, and audit planning. The questions cover concepts addressed in auditing assurance standards and include topics like internal controls, documentation, sampling, and management representations.

    Original Description:

    Bcom 6th semester auditing MCQs 2nd

    Original Title

    mcqs-auditing

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    This document contains 225 multiple choice questions related to auditing topics such as test checking, materiality, analytical procedures, audit evidence, substantive testing, audit risk, and audit planning. The questions cover concepts addressed in auditing assurance standards and include topics like internal controls, documentation, sampling, and management representations.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    4 views6 pages

    Mcqs Auditing

    Uploaded by

    medkwn.pbt
    This document contains 225 multiple choice questions related to auditing topics such as test checking, materiality, analytical procedures, audit evidence, substantive testing, audit risk, and audit planning. The questions cover concepts addressed in auditing assurance standards and include topics like internal controls, documentation, sampling, and management representations.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    You are on page 1of 6

    more mcqs

    chapter in
    Auditing

    3 of 13 sets

    201. Test Checking refers to


    A. Testing of accounts and records
    B. Checking of selected number of transactions
    C. Examination of adjusting and closing entries
    D. Checking of all transactions recorded
    Answer:B

    o m
    c
    202. Which of the following statements is not correct about materiality?
    .
    A. Materiality is a relative concept
    te
    a
    B. Materiality judgments involve both quantitative and qualitative judgments

    M
    C. Auditor’s consideration of materiality is influenced by the auditor’s perception of the needs of
    q
    c
    an informed decision maker who will rely on the financial statements

    M
    D. At the planning state, the auditor considers materiality at the financial statement level only
    Answer:D

    203. …...the audit risks… the materiality and ……the audit effort
    A. Lower, Higher, Lower
    B. Lower, Lower, Higher
    C. Higher, Lower, Lower
    D. Lower, Higher, Higher
    Answer:A

    204. When issuing unqualified opinion, the auditor who evaluates the audit
    findings should be satisfied that the
    A. Amount of known misstatement is documented in working papers
    B. Estimates of the total likely misstatement is less than materiality level
    C. Estimate of the total likely misstatement is more than materially level
    D. Estimates of the total likely misstatement cannot be made
    Answer:C

    205. In determining the level of materiality for an audit, what should not be
    considered?
    A. Prior year’s errors
    B. The auditor’s remuneration
    C. Adjusted interim financial statements
    D. Prior year’s financial statements
    Answer:B

    206. Analytical procedures issued in the planning stage of an audit, generally


    A. Helps to determine the nature, timing and extent of other audit procedures
    B. Directs attention to potential risk areas
    C. Indicates important aspects of business
    D. All of the above
    Answer:D

    207. Which of the following statements is most closely associated with analytical
    procedure applied at substantive stage?
    A. It helps to study relationship among balance sheet accounts
    B. It helps to discover material misstatements in the financial statements
    C. It helps to identify possible oversights
    D. It helps to accumulate evidence supporting the validity of a specific account balance
    Answer:D

    208. For all audits of financial statements made in accordance with AAS14, the use
    of analytical procedures is at the discretion of the auditor in which stage?
    A. Substantive testing
    B. Planning stage
    C. Overall review stage
    D. All of the above
    Answer:A

    209. Verification refers to :


    A. Examining the physical existence and valuation of assets.
    B. Examining the journal and ledger

    View all MCQ's at McqMate.com


    C. Examination of vouchers related to assets.
    D. None of the above.
    Answer:A

    210. Stock should be valued at


    A. Cost
    B. Market price
    C. Cost or Market price whichever is lower.
    D. Cost less depreciation.
    Answer:C

    211. ‘Auditor is not a valuer’, was stated in


    A. Kingston Cotton Mills case
    B. London Oil Storage Co. Case
    C. London and General Bank case
    D. None of the above
    Answer:A

    212. Floating assets are valued at


    A. cost
    B. Market price
    C. Cost or market price whichever is lower
    D. Cost less depreciation
    Answer:C

    213. Goods sold on the basis of ‘sales or return ‘ should


    A. Be included in the stock
    B. Not be included in the stock
    C. Not be checked by auditor
    D. None of the above
    Answer:A

    214. Of the following, which is the least persuasive type of audit evidence?
    A. Bank statements obtained from the client
    B. Documents obtained by auditor from third parties directly.

    View all MCQ's at McqMate.com


    C. Carbon copies of sales invoices inspected by the auditor
    D. Computations made by the auditor
    Answer:C

    215. Which of the following statements is, generally, correct about the reliability of
    audit evidence?
    A. To be reliable, evidence should conclusive rather than persuasive
    B. Effective internal control system provides reliable audit evidence
    C. Evidence obtained from outside sources routed through the client
    D. All are correct.
    Answer:B

    216. In an audit of financial statements, substantive tests are audit procedures that
    __
    A. May be eliminated for an account balance under certain conditions
    B. Are designed to discover significant subsequent events
    C. Will increase proportionately when the auditor decreases the assessed level of control risk
    D. May be test of transactions, test of balance and analytical procedures
    Answer:D

    217. The nature, timing and extent of substantive procedures is related to assessed
    level of control risk
    A. Randomly
    B. Disproportionately
    C. Directly
    D. Inversely
    Answer:C

    218. Which of the following factors is most important in determining the


    appropriations of audit evidence?
    A. The reliability of audit evidence and its relevance in meeting the audit objective
    B. The objectivity and integrity of the auditor
    C. The quantity of audit evidence
    D. The independence of the source of evidence
    Answer:A

    View all MCQ's at McqMate.com


    219. When is evidential matter, generally, considered sufficient?
    A. When it constitutes entire population
    B. When it is enough to provide a basis for giving reasonable assurance regarding truthfulness
    C. When it is objective and relevant
    D. When auditor collects and evaluates it independently
    Answer:B

    220. Which of the following is not corroborative evidence?


    A. Minutes of meetings
    B. Confirmations from debtors
    C. Information gathered by auditor through observation
    D. Worksheet supporting consolidated financial statements
    Answer:D

    221. Which of the following statements is not true with respect to management
    representations obtained as per AAS11?
    A. Authenticated copy of relevant minutes of meetings may be regarded as management
    representation
    B. It should always be in working
    C. It may be dated prior to the report date
    D. It should be addressed to the auditor
    Answer:B

    222. What would most appropriately describe the risk of incorrect rejection in
    terms of substantive testing?
    A. The auditor concludes balance is materially correct when in actual fact it is not
    B. The auditor concludes that the balance is materially misstated when in actual fact it not
    C. The auditor has rejected an item for sample which was material
    D. None of the above
    Answer:B

    223. Which of the following affects audit effectiveness?


    A. Risk of over reliance
    B. Risk of incorrect rejection
    C. Risk of incorrect acceptance
    D. Both (a) and (c)

    View all MCQ's at McqMate.com


    Answer:D

    224. What would most effectively describe the risk of incorrect acceptance in terms
    of substantive audit testing?
    A. The auditor has ascertained that the balance is materially correct when in actual fact it is not
    B. The auditor concludes the balance is materially misstated when in actual fact is not
    C. The auditor has rejected an item from sample which was not supported by documentary
    evidence
    D. He applies random sampling on data which is inaccurate and inconsistent
    Answer:A

    225. Which of the following Auditing Assurance Standard deals with Audit
    Planning?
    A. AAS7
    B. AAS8
    C. AAS9
    D. AAS3
    Answer:B

    View all MCQ's at McqMate.com

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