Auditing MCQs

Page No. 11

According to ISA 315, which of the following is NOT an element of the control environment?


aParticipation of management


b Information processing


cCommitment to competence


dHuman resource policies and practices



The degree of effectiveness of an internal control system depends on:


aThe design of the internal control system and the implementation of the controls


bThe design of the internal controls and the implementation of the control system


cThe implementation of the controls and the correctness of the accounting records


dThe design of the internal control system and the correctness of the accounting records



Which of the following is normally the most reliable source of audit evidence?


aInternal audit


bSuppliers’ statements


cBoard minutes


dAnalytical review



According to ISA 500, the strength of audit evidence is determined by which two qualities?


aAppropriateness & competence


bSufficiency & appropriateness


cReliability & extensiveness


dObjectivity & independence



Which of the following are you unlikely to see in the current file of auditors’ working papers?


aMemorandum & articles of association


bAudit planning memorandum


cSummary of unadjusted errors


dDetails of the work done on the inventory count



Which of the following is NOT an accepted method of selection in sampling?


aSystematic selection


bPervasive selection


cRandom selection


dHaphazard selection


View Answer Pervasive selection

Which of the following describes sampling risk?


aThe risk of the auditor carrying out a test the wrong way round


b The risk of reliance on unsuitable audit evidence


cThe risk that the sample does not reflect the population


d The risk of the auditor reaching the wrong conclusions from testing



At the planning stage you would NOT consider____________?


a the timing of the audit


bwhether corrections from the inventory count have been implemented


clast year’s audit


dthe potential use of internal audit



Which of the following should NOT be considered at the planning stage?


aThe timing of the audit


b Analytical review


cLast year’s written representation letter


dObtaining written representations



Audit risk is composed of 3 factors. Which of the following is NOT one of those factors?


aCompliance risk


bDetection risk


cControl risk


dInherent risk


View Answer Compliance risk

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