Sample Audit Model Exam

                             

 Sample Audit Model Exam 

1.      Which of the following is primarily responsible for the fairness of the presentations   made in the financial statements?

A.    The client’s management

B.     The independent auditor

C.     The audit committee

D.    The board of directors

2.      An audit designed to detect violations of laws and regulations would be referred to a

A.    Financial statement audit           

B.     Compliance audit

C.     Performance audit

D.    Operational audit

3.      What is the essence of external audit function?

A.    To detect frauds and errors

B.     To examine individual transactions so that the auditor may certify their Validity

C.     To determine whether the client’s financial statements are fairly stated.

D.    To assure the consistent application of correct accounting procedures.

4.      Who makes the ultimate decision as to whether or not auditors maintain an appearance of independence from their audit clients?

A.    Auditors

B.     Client

C.     audit committee

D.    public

5.      Who is primarily responsible for the fair presentation of the financial statement?

A.    The auditor

B.     The client

C.     The board of directors

D.    The shareholders

6.      While performing an audit, an auditor strives to achieve independence in appearance in order to:

A.    reduce risk and liability

B.      become independent in fact

C.     maintain public confidence in the profession

D.    Comply with generally accepted standards of field work.

7.      The risk that the auditors' own work will lead to the decision that material  misstatement do not exist in the financial statements, when, in fact  such misstatement do exist is:

A.    Audit risk

B.     Detection risk

C.     Inherent risk

D.    Control risk

8.      A detailed written plan of the audit work to be performed by the auditor, and specifying the procedures that are designed to gather evidence is known as:

A.    Audit procedure

B.     Audit engagement

C.     Audit evidence

D.    Audit program

9.       The part of audit risk which arises due to the inefficiency of internal control is?

A.    Detection risk

B.      Control risk

C.     Inherent risk

D.     material risk

10.  Audit evidence can come in different forms with different degrees of persuasiveness. Which of the following is the least reliable type of evidence?

A.    Supplier's invoice

B.     Bank statement

C.     Computations made by auditor

D.     Accounting records of the client

11.  An auditor’s responsibility to express opinion on the financial statements is represented in the:

A.    Introductory paragraph

B.      Scope paragraph

C.     Opinion paragraph

D.     explanatory paragraph

12.  Under which of the following circumstances might an auditor provide disclaimer opinion?

A.    When the financial statement contain a departure from GAAP

B.      When there are significant uncertainties affecting the financial statements

C.      When the principal auditor decides to make reference to the reports of   another auditor who audited a subsidiary.

When there has been a material change between periods in the method of        application of accounting princip