Auditing MCQs

Page No. 9

Which of the following is not corroborative evidence?


aMinutes of meetings


bConfirmations from debtors


cInformation gathered by auditor through observation


dWorksheet supporting consolidated financial statements



Which of the following statements is, generally, correct about the reliability of audit evidence?


aTo be reliable, evidence should conclusive rather than persuasive


bEffective internal control system provides reliable audit evidence


cEvidence obtained from outside sources routed through the client


dAll are correct.



Goods sold on the basis of ‘sales or return ‘ should:


aBe included in the stock


bNot be included in the stock


c Not be checked by auditor


dNone of the above



Floating assets are valued at____________?


acost


bMarket price


cCost or market price whichever is lower


dCost less depreciation



Stock should be valued at_________?


aCost


bMarket price


cCost or Market price whichever is lower.


d Cost less depreciation.



Verification refers to_________?


aExamining the physical existence and valuation of assets.


bExamining the journal and ledger


cExamination of vouchers related to assets


dNone of the above.



______the audit risks_______the materiality and_________the audit effort.


aLower, Higher, Lower


bLower, Lower, Higher


cHigher, Lower, Lower


d Lower, Higher, Higher


View Answer Lower, Higher, Lower

Test Checking refers to___________?


aTesting of accounts and records


bChecking of selected number of transactions


cExamination of adjusting and closing entries


dChecking of all transactions recorded



Window dressing implies_______________?


aCurtailment of expenses


bChecking of Wastages


cUnder valuation of assets


dOver Valuation of assets



Errors of Omission are_____________?


aTechnical errors


bErrors of principle


cCompensating errors


dNone of the above


View Answer Technical errors

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