This quiz titled 'MC for Audit Final' assesses knowledge on auditing in automated environments, report distribution limitations, and financial projections. It is designed for learners preparing for professional accounting exams, focusing on audit risks and standards.
Submit the expected statements but omit $25,000 of unsupported disbursements.
Include the unsupported disbursements in the statements since you are not expected to make an audit.
Obtain from the manager a written statement that you informed him of the missing invoices and include his assurance that the disbursements are proper.
Notify the owners that some of the claimed disbursements are unsupported and withdraw if the situation is not satisfactorily resolved.
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A compilation
A review
An examination
An agreed-upon procedures engagement
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Generally accepted auditing standards apply to these engagements and the reporting requirements differ.
Generally accepted auditing standards apply to these engagements and the reporting requirements are the same as well.
Generally accepted auditing standards do not apply to these examinations and the reporting requirements differ also.
Generally accepted auditing standards do not apply to this engagement and the reporting requirements remain the same for the CPA.
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AICPA's Code of Professional Conduct.
Statements on Auditing Standards (SASs).
Statements of Standards on Attestation Engagements (SSAEs).
Statements on Standards for Accounting and Review Services (SSARS).
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Audit
Review
Compilation
Agreed-upon procedures
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Management letter.
Letter of inquiry.
Letters testamentary.
Management letter of representation.
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Review minutes and resolutions of the board of directors.
Review prior year's audit files with respect to such guarantees.
Review the possibility of such guarantees with the chief accountant.
Review the legal letter returned by the company's outside legal counsel.
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Forecasts Projections Yes Yes
Forecasts Projections No No
Forecasts Projections Yes No
Forecasts Projections No Yes
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Final analytical procedures
Search for contingent liabilities
Evaluate the going concern assumption
Acquire the client's letter of representation
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Audit
Review
Agreed-upon procedures
Examination
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Stockholders of record as of the date of the report.
Potential investors and creditors by posting on the Company's website.
General public by posting on the company's website.
A financial institution for which the company is negotiating a loan.
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Does not place enough reliance on the processed information
Places too much reliance on the processed information
Processed information may not reveal the sources of the information
Does not understand the processed information produced by the automated environment
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Send the standard bank confirmation request to all of the client's lender banks.
Review client minutes and obtain a representation letter.
Examine supporting documents for all entries in intercompany accounts.
Obtain written confirmation of indebtedness from the auditor of the affiliate.
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