FULL TEST BANK for Auditing and Assurance
Services (an integrated approach) 17th Edition by
Chris E. Hogan Alvin A. Arens, Randal J. Elder
COMPLETE CHAPTERS 1-24| Verified Q&As for
Exam Preparations| A+ GRADED
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, Chapter 1: The Demand for Audit and Other Assurance Services
Learning Objective 1-1
1) The Sarbanes-Oxley Act applies to which of the following companies?
A) All companies
B) Privately held companies
C) Public companies
D) All public companies and privately held companies with assets greater than $500 million Correct
Answer: C
Terms: Sarbanes-Oxley Act Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills Topic: SOX
2) Which of the following is considered audit evidence? A)
Oral statements
made by management Written
Communications Auditor
Observation
Y N N
B)
Oral statements made by management Written Communications Auditor Observation
N Y Y
C)
Oral statements
made by management Written
Communications Auditor
Observation
Ar
Y Y Y
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,D)
Oral statements
made by management Written
Communications Auditor
Observation
N N Y
Correct Answer: C
Terms: Audit evidence Diff: Moderate Objective: LO 1-1
AACSB: Reflective thinking skills
3) Evidence is paramount to audit and attestation engagements. List the four basic types of audit evidence.
Correct Answer: The four types of audit and attestation evidence include:
1. Electronic and documentary data about transactions
2. Written and electronic communications with outsiders
3. Observations by the auditor
4. Oral testimony of the auditee (client) Terms: Basic types of audit evidence Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills
4) The criteria by which an auditor evaluates the information under audit may vary with the information being
audited.
A) True
B) False Correct Answer: A
Terms: Criteria which an auditor evaluates information Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills
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, 5) The criteria used by an external auditor to evaluate published financial statements are known as generally
accepted auditing standards.
A) True
B) False Correct Answer: B
Terms: Criteria used by external auditor to evaluate published financial statements Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills
6) The Sarbanes-Oxley Act establishes standards related to the audits of privately held companies.
A) True
B) False Correct Answer: B
Terms: Sarbanes-Oxley Act Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills Topic: SOX
7) The Sarbanes-Oxley Act is widely viewed as having ushered in sweeping changes to auditing and financial
reporting.
A) True
B) False Correct Answer: A
Terms: Sarbanes-Oxley Act Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills Topic: SOX
8) An auditor must be competent and have an independent mental attitude.
A) True
B) False Correct Answer: A
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Terms: Competence and independent mental attitude Diff: Easy
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Objective: LO 1-1
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Services (an integrated approach) 17th Edition by
Chris E. Hogan Alvin A. Arens, Randal J. Elder
COMPLETE CHAPTERS 1-24| Verified Q&As for
Exam Preparations| A+ GRADED
Ar
ch
pg. 1
Do
c
, Chapter 1: The Demand for Audit and Other Assurance Services
Learning Objective 1-1
1) The Sarbanes-Oxley Act applies to which of the following companies?
A) All companies
B) Privately held companies
C) Public companies
D) All public companies and privately held companies with assets greater than $500 million Correct
Answer: C
Terms: Sarbanes-Oxley Act Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills Topic: SOX
2) Which of the following is considered audit evidence? A)
Oral statements
made by management Written
Communications Auditor
Observation
Y N N
B)
Oral statements made by management Written Communications Auditor Observation
N Y Y
C)
Oral statements
made by management Written
Communications Auditor
Observation
Ar
Y Y Y
ch
pg. 2
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c
,D)
Oral statements
made by management Written
Communications Auditor
Observation
N N Y
Correct Answer: C
Terms: Audit evidence Diff: Moderate Objective: LO 1-1
AACSB: Reflective thinking skills
3) Evidence is paramount to audit and attestation engagements. List the four basic types of audit evidence.
Correct Answer: The four types of audit and attestation evidence include:
1. Electronic and documentary data about transactions
2. Written and electronic communications with outsiders
3. Observations by the auditor
4. Oral testimony of the auditee (client) Terms: Basic types of audit evidence Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills
4) The criteria by which an auditor evaluates the information under audit may vary with the information being
audited.
A) True
B) False Correct Answer: A
Terms: Criteria which an auditor evaluates information Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills
Ar
ch
pg. 3
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c
, 5) The criteria used by an external auditor to evaluate published financial statements are known as generally
accepted auditing standards.
A) True
B) False Correct Answer: B
Terms: Criteria used by external auditor to evaluate published financial statements Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills
6) The Sarbanes-Oxley Act establishes standards related to the audits of privately held companies.
A) True
B) False Correct Answer: B
Terms: Sarbanes-Oxley Act Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills Topic: SOX
7) The Sarbanes-Oxley Act is widely viewed as having ushered in sweeping changes to auditing and financial
reporting.
A) True
B) False Correct Answer: A
Terms: Sarbanes-Oxley Act Diff: Easy
Objective: LO 1-1
AACSB: Reflective thinking skills Topic: SOX
8) An auditor must be competent and have an independent mental attitude.
A) True
B) False Correct Answer: A
Ar
Terms: Competence and independent mental attitude Diff: Easy
ch
Objective: LO 1-1
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