EP AUDITING+ASSURANCE...-MYACCT.LAB
16th Edition
ISBN: 9780134148656
Author: ARENS
Publisher: PEARSON CO
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Chapter 7, Problem 22.2MCQ
To determine
Identify the situation where there is a best change to detect when a CPA compares 2016 revenues and expenses with previous year and inspects all changes exceeding a fixed percent.
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The auditor should consider audit risk when planning and performing an audit of financial statements. Audit risk should also be
considered together in determining the nature, timing, and extent of auditing procedures and in evaluating the results of those
procedures.
Required:
a. Define audit risk.
b. Describe the components of audit risk (e.g., inherent risk, control risk, and detection risk).
c. Explain how these components are interrelated.
(AICPA, adapted)
The scope of an audit includes:
a.
Reliable Information
b.
Legal Requirements
c.
Entity Aspects
d.
All options are correct
Audit documentation is the written record of the basis for the auditor's conclusions that provides the support for the auditor's representations, whether those representations are contained in the auditor's report.
Required:
a. Assess the significance of documentation for audits.
Chapter 7 Solutions
EP AUDITING+ASSURANCE...-MYACCT.LAB
Ch. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Prob. 3RQCh. 7 - Prob. 4RQCh. 7 - Prob. 5RQCh. 7 - Prob. 6RQCh. 7 - Prob. 7RQCh. 7 - Prob. 8RQCh. 7 - Prob. 9RQCh. 7 - Prob. 10RQ
Ch. 7 - Prob. 11RQCh. 7 - Prob. 12RQCh. 7 - Describe the liquidity activity ratios and explain...Ch. 7 - Prob. 14RQCh. 7 - Prob. 15RQCh. 7 - Prob. 16RQCh. 7 - Prob. 17RQCh. 7 - Prob. 18RQCh. 7 - Define what is meant by a tick mark. What is its...Ch. 7 - Prob. 20RQCh. 7 - Prob. 21.1MCQCh. 7 - Prob. 21.2MCQCh. 7 - Prob. 21.3MCQCh. 7 - Prob. 22.1MCQCh. 7 - Prob. 22.2MCQCh. 7 - Prob. 22.3MCQCh. 7 - Prob. 23.1MCQCh. 7 - Prob. 23.2MCQCh. 7 - Prob. 23.3MCQCh. 7 - Prob. 24.1MCQCh. 7 - Prob. 24.2MCQCh. 7 - Prob. 24.3MCQCh. 7 - Prob. 25DQPCh. 7 - Prob. 26DQPCh. 7 - Prob. 27DQPCh. 7 - Prob. 28DQPCh. 7 - Prob. 29DQPCh. 7 - Prob. 30DQPCh. 7 - Following are 10 audit procedures with words...Ch. 7 - Prob. 32DQPCh. 7 - Prob. 33DQPCh. 7 - Prob. 34DQPCh. 7 - You are auditing payroll for the Morehead...Ch. 7 - Prob. 36DQPCh. 7 - Prob. 38C
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Similar questions
- The auditor should consider audit risk when planning and performing an audit of financial statements. Audit risk should also be considered together in determining the nature, timing, and extent of auditing procedures and in evaluating the results of those procedures. Required: a. Define audit risk b. Describe the components of audit risk (e.g., inherent risk, control risk, and detection risk). c. Explain how these components are interrelatedarrow_forwardWhich of the following categories of principles is most closely related to gathering audit evidence?a. Performance.b. Reasonable assurance.c. Reporting.d. Responsibilities.arrow_forwardWhich of the following is the major purpose of performing analytical procedures in internal audits? a. To perform additional audit procedures. b. To plan the audit engagement. c. To obtain audit evidence. d. To study relationships among elements of information.arrow_forward
- Evidence is defined as any information used by the auditor to determine whether the quantitative information being audited is stated in accordance with the established criteria. Required b) Discuss TWO (2) audit procedures to ensure sufficiency of audit evidence by providing ONE (1) example each.arrow_forwardAudit documentation is the written record of the basis for the auditor's conclusions that provides the support for the auditor's representations, whether those representations are contained in the auditor's report. Required: b. Discuss TWO (2) important factors that affect the form of audit documentation.arrow_forwardAuditing is based on the assumption that financial data and statements are A. Verifiable B. Consistently applied C. Presented fairly D. In conformity with appropriate criteriaarrow_forward
- (ii) Explain the term ‘analytical procedures’ and outline the different types of analytical proceduresavailable to the auditor indicating situations in the audit when they can be usedarrow_forwardIn the auditor's current audit documentation files, what is regarded to be the most significant content?arrow_forwardDefine the term "materiality" in the context of audit reporting. What factors will influence the auditor's assessment of materiality?arrow_forward
- In auditing, a special purpose auditors’ report is used in connection with the independent audit of the following financial information, EXCEPT A. Financial statements prepared in accordance with a comprehensive basis of accounting B. Compliance with contractual agreements C. Specified accounts elements of accounts or items in a financial statement D. Financial statements prepared in accordance with PFRSarrow_forwardThe particular and specialized actions that auditors take to obtain evidence during a specific engagement are known asa. Audit procedures.b. Audit standards.c. Interpretive publications.d. Statements on Auditing Standardsarrow_forwardEvidence is defined as any information used by the auditor to determine whether the quantitative information being audited is stated in accordance with the established criteria. Required: a) Explain TWO (2) characteristics to determine the reliability of audit evidencearrow_forward
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