云南财经大学国际工商学院罗世华审计学答案

Part . (30 questions) Choose the best answer from A C and D for each of the following questions, each question contains 2% marks. 1 Today auditing becomes an economic demand, the reasons for this is listed below, which one is the true? ( ) A. auditing can reduce inherent risk for the customers; B. auditing can reduce information risk for the customers; C. auditing can reduce business risk for the customers; D. all of the above are true; 2 CPA firms provide a number of services, which of the following is non-assurance services: ( ) A. Auditing of historical financial statements; B. Effectiveness of internal control over financial reporting; C. Tax services; D. Review of historical financial statements; 3. The biggest difference between a CPA firm and an internal auditor is: ( ) A. The extent of competence; B. They are regulated by different rules; C. They have different auditing procedures; D. The extent of independence; 4. The SECs attitude is generally considered in any major change proposed by the Financial Accounting Standards Board (FASB), the independent organization that establishes GAAP, this is because: ( ) A. SEC has more knowledge about the suitableness of the GAAP than FASB; B. SEC is by law the administrator of the FASB; C. SEC regulate the security market, therefore only when the auditing meets their requirement the company can go to the security market to raise funds; The First Semester of 20102011 Yunnan University of Finance 5. Due professional care is a general standard of the GAAS, which means: ( ) A. consideration of the completeness of the audit documentation; B. the sufficiency of the audit evidence; C. the appropriateness of the audit report; D. all of the above is included; 6. The relationship between GAAS and PCAOB Auditing Standards is: ( ) A. they are totally different, one for public companies and one for private companies; B. they are actually no different; C. they are mostly same with a little bit difference; D. they are mostly different with something same; 7. An unqualified audit report with explanatory paragraph or modified wording is issued if there are some circumstances occurred, these circumstances are: ( ) A. Lack of consistent application of generally accepted accounting principles; B. Substantial doubt about going concern; C. emphasis of a matter; D. all of the above are true; 8. If scope is restricted by client or other conditions and it is material but not too bad, what audit report should be issued? ( ) A. Qualified scope and opinion report; B. Qualified opinion report; C. Disclaimer; D. Adverse; 9. If financial statement is not prepared in accordance with GAAP and it is so material, what audit report should be issued? ( ) A. Qualified scope and opinion report; B. Qualified opinion report; C. Disclaimer; D. Adverse; 10. If your client has several other auditors and their work is closely supervised by you, as a principle auditor with no other circumstances requiring a departure, you should issue : ( ) A. unqualified audit report; B. unqualified audit report with explanatory paragraph or modified wording; C. Qualified scope and opinion report; D. Qualified opinion report; 3 11. If the client has several other auditors, as a principal auditor, if you dont want to be responsible for the work of other auditors, you will: ( ) A. Qualify the opinion; B. make no reference in the audit report; C. make reference in the report; D. issue an unqualified audit report with explanatory paragraph or modified wording; 12. Misappropriation of assets is: ( ) A. intentional fraud; B. unintentional fraud; C. employee fraud; D. management fraud; 13. Why audits are performed by dividing the financial statement into smaller segments or components? ( ) A. because the division makes the audit more manageable; B. because the division aids in the assignment of the tasks to different members of the audit team; C. both A and B answers are correct; D. because auditing are performed by four phases; 14. Deferred tax account is in: ( ) A. Sales and collection cycle; B. payroll and personnel cycle; C. Acquisition and payment cycle; D. inventory and warehousing cycle; 15. Interest expense is in: ( ) A. Sales and collection cycle; B. payroll and personnel cycle; C. Acquisition and payment cycle; D. none of the above is correct; 16. Audit evidence decisions decide the persuasiveness of the evidence, which of the following is true : ( ) A. Sample size and items to select decide sufficiency; B. Audit procedures and timing decide sufficiency; C. Sample size and items to select decide competence; D. none of the above is correct; 17. According to the criteria, the independence of Provider, which of the following types of evidence has a lowest competence: ( ) A. Physical examination; B. Analytical procedures 4 C. Inquiries; D. observation 18.About engagement letter, which of the following is not true: ( ) A. it specify any restrictions to be imposed on the auditors work; B. it state the auditors responsibilities to the client and financial statement users; C. it often includes an agreement on fees; D. it also states that the auditor cannot guarantee that all acts of fraud will be discovered; 19.To do the auditing, we need understand the clients business and industry, why? ( ) A. there are risks associated with specific industries; B. in certain industries there are common inherent risks to all the members; C. many industries may have unique accounting requirements that the auditor must understand; D. all of the above are true; 20. Analytical procedures are performed at three phases, for the completion phase, the purpose is ( ) A. Understand clients industry and business; B. Assess going concern; C. indicate possible misstatements; D. only B and C are correct; 21. If Planned detection risk (PDR) is 5%, what does it mean? ( ) A. it means audit evidence for a segment will fail to detect misstatements exceeding a tolerable amount by 5% chance; B. it means auditors assume 5% risks not to make the correct decision; C. it means financial statement has 5% chance to be wrongly recorded; D. none of the above is correct; 22. About engagement risk, which of the following is not true? ( ) A. Engagement risk is closely related to inherent risk; B. Engagement risk is closely related to client business risk; C. Engagement risk is very similar as acceptable audit risk; D. Same factors affect engagement risk and acceptable audit risk; 23. When Acceptable audit risk is compared with Achieved audit risk, we will know: ( ) A. whether sufficient competent evidence has been collected for that account or cycle; B. whether the auditor should accept or reject the clients audit application; C. what audit report should be issued; D. none of the above is correct; 5 24. For sales, in order to finish the existence audit objective, we will assess internal control, which of the following procedure is not for this objective? ( ) A. whether customers credit is approved by a responsible official; B. whether the recoding of sales is supported by authorized shipping documents and approved customer orders; C. whether sales invoices are prenumbered and accounted for; D. whether shipping documents are prenumbered and accounted for; 25. If we found that there is a lack of internal verification for the possibility of sales invoices being recorded more than once, what audit objectives control risk will be affected? ( ) A. existence; B. completeness; C. accuracy; D. timing; 26. Assessing whether statements are sent to customer each month is for: ( ) A. existence audit objective; B. existence and accuracy audit objectives; C. completeness audit objective; D. completeness and existence audit objectives; 27. About the effect on sample size of changing factors, which of the following is not true? ( ) A. increase population size, sample size increase; B. increase estimated population exception rate, sample size increase; C. increase tolerable exception rate, sample size increase; D. increase acceptable risk of assessing control risk, sample size decrease; 28. Using nonstatistical sampling, how we decide the results? ( ) A. calculate CUER, if CUER is bigger than TER, the results is good; B. calculate CUER, if CUER is smaller than TER, the results is good; C. calculate Sampling error, if sampling error is bigger than TER, the results is good; D. calculate sampling error, if sampling error is bigger than a setting standard, the results is good; 29. When using confirmation to verify accounts receivable accounts, if the response is that the payment has already been made, what can we think of? ( ) A. a theft of cash; B. a cash receipts cutoff misstatement; C. lapping; D. all of the above; 30. Using nonstatistical sampling, trace selected sales invoice numbers from the sales 6 journal to bill of lading and test for customer name, product description, quantity and date, we found that SER is 4% while the TER and the required minimum sampling error is set to be 5% and 4% respectively. What following results will be the most likely one? ( ) A. the con