Choose the letter of the correct answers. Which of the following statements is correct?1 An entity whose financial statements comply with PFRS/IFRSshall no longer make an explicit and unreserved statement of suchcompliance in the notes.I An entity shall not describe financial statements as complyingwith PFRS/IFRS unless they comply with all the requirements ofPFRS/IFRS.а. I onlyBoth I and IIс.b. Пonlyd. Neither I nor II3.The following statements are correct, except:An entity shall prepare all its financial statements using the.а.accrual basis of accounting.b. An entity need not provide a specific disclosure required by PFRS/IFRS if the information is not material.С.An entity shall not offset assets and liabilities or income andexpenses, unless required or permitted by PFRS/IFRS.d. When an entity departs from a requirement of PFRS/IFRS, it shalldisclose that it has complied with applicable PFRS/IFRS, exceptthat it has departed from a particular requirement to achieve a fairpresentation.4. Which of the following statements is correct?'I. An entity shall present separately each immaterial class of similaritems.II. An entity shall present separately each dissimilar nature orfunction unless they are immaterial.a. IonlyI onlyBoth I and IIС.II onlyd. Neither I nor II2.

In case of multiple parts, only first independent part shall be answered. Further parts need to be…

2. Which of the following statements is correct? I An entity whose financial statements comply with PFRS/IFRS shall no longer make an explicit and unreserved statement of such compliance in the notes. I An entity shall not describe financial statements as complying with PFRS/IFRS unless they'comply with all the requirements of PFRS/IFRS.

2. Which of the following statements is correct? I An entity whose financial statements comply with PFRS/IFRS shall no longer make an explicit and unreserved statement of such compliance in the notes. I An entity shall not describe financial statements as complying with PFRS/IFRS unless they'comply with all the requirements of PFRS/IFRS.

Auditing: A Risk Based-Approach to Conducting a Quality Audit

10th Edition

ISBN:9781305080577

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter17: Other Services Provided By Audit Firms

Section: Chapter Questions

Problem 20MCQ

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Which management assertion addresses whether the components of the financial statements arc properly classified, described, and disclosed? a. Completeness. b. Existence. c. Rights and obligations. d. Presentation and disclosure. c. None of the above address whether the components of the financial statements arc properly classified, described, and disclosed.
4. Which statement is correct concerning compliance with PFRS?I An entity whose financial statements comply with PFRS shall make an explicit and unreserved statement of such compliance in the notes.II An entity shall not describe financial statements as complying with PFRS unless they comply with all the requirements of each applicable PFRS.a. I onlyb. II onlyc. Both I and IId. Neither I nor II 5. Which information is not included in the “notes to financial statements”?a. Statement of compliance with PFRSb. Statement of measurement basis and accounting policies usedc. Supporting computation for line items presented and aggregatedd. Cash Flows 6. These are defined as “the specific principles, methods, practices, rules, bases and conventions adopted by an entity in preparing and presenting financial statements.a. Contingencies and commitmentsb. Notes to financial statementsc. Nonfinancial disclosuresd. Accounting Policies
1. Which statement is incorrect regarding materiality judgments? A. An entity is only required to apply recognition and measurement equirements in PFRSS when the effect of applying them material. B. An entity need not provide a disclosure specified by a PFRS if the information resulting from that disclosure is not material. C. Public availability of information relieves an entity of the obligation to provide material information in its financial statements. D. It is inappropriate for the entity to make, or leave uncorrected, immaterial departures from PFRSs to achieve a particular presentation of its financial position, financial performance or cash flows. 2. Which of the following is an appropriate aggregation? A. Cash and cash equivalents (Cash in bank and sinking fund) B. Trade and other receivables (Accounts receivable and investment in bonds) C. Trade and other payables (Accounts payable and accruals) D. Provisions (Income tax payable and warranty liability) 3. Which of the…
The following does not constitute fair presentation and compliance with IFRS:a) an entity rectify inappropriate accounting policies by additional disclosureb) an entity did not selectively apply standards it likesc) an entity follows the recognition criteria for assets, liabilities and expenses set out in the conceptual frameworkd) an entity apply IFRS, with additional disclosure when necessary
(a) Explain and give an example of the effect on a set of published financial statements if the going concern convention is held not to apply. (b) Explain in general terms what the IASB Conceptual Framework is trying to
Under IFRS, changes in accounting policies are a. permitted if the change will result in a more reliable and more relevant presentation of the financial statements. b. permitted if the entity encounters new transactions, events, or conditions that are substantively different from existing or previous transactions. c. required on material transactions, if the entity had previously accounted for similar, though immaterial, transactions under an unacceptable accounting method. d. required if an alternate accounting policy gives rise to a material change in assets, liabilities, or the current- year net income.
Which statement is incorrect? a. The systematic manner of presentation of Notes to F/S is mandatory, as far as practicable.T b. The first item to be presented in the Notes to F/S is the statement of compliance with PFRS. c. The cross reference between each line item in the F/S and any related information disclosed in the Notes to F/S is mandatory. d. None of the above Which statement is incorrect? a. Revenues are income that arises from the ordinary course of business activities. b. Revenues may arise from decrease in liability from primary operations. c. Generally, revenue is recognized when the earning process is complete and a valid promise of payment has been received. d. Revenues arise from sale of goods or services, use of entity resources and disposal of noncurrent assets of the businesses. e. None of the above
true or false According to PAS 19, an entity shall recognize the PV of DBO in its accounts and in its financial statements.
Which statement is incorrect? a. Notes to financial statements provide narrative description or disaggregation of items disclosed in F/S and information about items that do not qualify for recognition. b. Notes to financial statements are an integral part of financial statements. c. Notes to financial statements amplify the items presented in the financial statements. d. Notes to financial statements is the best demonstration of the standard of adequate disclosure. e. none of the above
A business entity is required to maintain the same accounting policies. However, the entity is permitted by MRFS 108 Accounting Policies, Changes in Accounting Estimates and Errors to change its accounting policies under two situations.Required: -Explain the two (2) situations stated in MFRS 108.
Accdg. to PAS , related party disclosures are necessary * to indicate the possibility that an entity's financial position and performance might have been affected by the existence of such relationship because related party transactions may have resulted to assets and liabilities that were recognized in the financial statements of the reporting entity to notify users of financial statements of the fact that related party transactions may not have been made on arm's length basis in order to eliminate or minimize the effects of related party transactions on the FS of the reporting entity
IAS 37, Provisions, Contingent Liabilities and Contingent Assets was issued in 1998. The Standard sets out the principles of accounting for these items and clarifies when provisions should and should not be made. Prior to its issue, the inappropriate use of provisions had been an area where companies had been accused of manipulating the financial statements and of creative accounting.Required:a) Describe the nature of provisions and the accounting requirements for them contained in IAS 37.b) Explain why there is a need for an accounting standard in this area. Illustrate your answer with three practical examples of how the Standard addresses controversial issues.