Auditing: A Practical Approach with Data Analytics 1st Edition Test Bank – Wiley, Johnson, Moroney, Campbell & Hamilton | Chapters 1–15 | Verified Questions and Answers

TEST BANK i



Auditing:A Practical Approach with Data Analytics
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1st Edition by Campbell
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All chapters (1-15) covered
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, Table of Contents i i




Chapter 1: Introduction and Overview of Audit and Assurance Chapter
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2: Professionalism and Professional Responsibilities Chapter 3: Risk
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Assessment Part I: Audit Risk and Audit Strategy Chapter 4: Risk
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Assessment Part II: Understanding the Client Chapter 5: Audit
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i Evidence
Chapter 6: Gaining an Understanding of the Client's System of Internal
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Control
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Chapter 7: Audit Data Analytics
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Chapter 8: Risk Response: Performing Tests of Controls Chapter 9:
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Risk Response: Performing Substantive Procedures
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Chapter 10: Risk Response: Evaluating Audit Data Analytics and Audit
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Sampling
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Chapter 11: Auditing the Revenue Process
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Chapter 12: Auditing the Purchasing and Payroll Processes
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Chapter 13: Auditing Various Balance Sheet Accounts (and Related
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Income Statement Accounts)
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Chapter 14: Completing the Audit
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i Chapter 15: Reporting on the Audit
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, Chapter 1 i




Introduction and Overview ofAudit and i i i i i




Assurance i



Question iType: iTrue ior iFalse


1. GAAP iand iIFRS iare iexamples iof iapplicable ifinancial ireporting iframework.
A. True
B. False
Answer: iA, iTaxonomy: iKnowledge, iDifficulty: iEasy, iAICPA iFC: iReporting, iAACSB: i i Communication, iLearning
i Objective: iLO1.1, iSolution: iThe iapplicable ifinancial ireporting i i framework irefers i to ithe iset iof istandards

iused i in ipreparing ithe ihistorical ifinancial istatements, i i such ias iGAAP, iIFRS ior ia iFederal iIncome iTax

iBasis iof i Accounting.




2. Review iof ifinancial iforecasts ifalls iunder iattestation iservices.
A. True
B. False
Answer: iA, iTaxonomy: iKnowledge, iDifficulty: iEasy, iAICPA iFC: iMeasurement iAnalysis iand i i Interpretation,
i AACSB: iEthics, iLearning iObjective: iLO1.1, iSolution: iAttestation iservices i(under i i the iumbrella iof iassurance

i services) iinclude ireview iof ihistorical ifinancial istatements, ireview iof i i financial iforecasts, iand

iexamination iof i internal icontrol.




3. Within ia iU.S. icontext, ithe iapplicable ifinancial ireporting iframework iis itypically iGenerally
i Accepted iAccounting iPrinciples i(GAAP).



A. True
B. False
Answer: iA, iTaxonomy: iKnowledge, iDifficulty: iEasy, iAICPA iFC: iMeasurement iAnalysis iand i
i Interpretation, i AACSB: iEthics, iLearning iObjective: iLO1.2, iSolution: iWithin ia iU.S. icontext, ithe i

i applicable ifinancial i reporting iframework iis itypically igenerally iaccepted iaccounting iprinciples i

i (GAAP).




1

, 4. Private icompanies, ior inon-issuers, iare inot irequired iby ithe iU.S. igovernment ito ihave ian i i annual
i financial istatement iaudit



A. True
B. False
Answer: iA, iTaxonomy: iKnowledge, iDifficulty: iEasy, iAICPA iFC: iReporting, iAACSB: iAnalytic, i i Learning
i Objective: iLO1.2, iSolution: iPrivate icompanies, ior inon-issuers, iare inot irequired iby ithe

U.S. igovernment ito ihave ian iannual ifinancial istatement iaudit, ibut ioften iother iinterested iusers, i isuch ias ia
i bank ior ilender, imay irequest ithat ia iprivate icompany iprovide iaudited ifinancial i i statements.




5. One iof ithe ireasons ithere iis ia idemand ifor ifinancial istatement iaudits iis ithat iusers iof ifinancial
i statements i often i lack i accounting i and i legal i knowledge i to i fully i understand i complex

i accounting iand idisclosure ichoices.



A. True
B. False
Answer: iA, iTaxonomy: iComprehension, iDifficulty: iEasy, iAICPA iPC: iCommunication, iAACSB: i i Analytic,
iLearning i Objective: iLO1.3, iSolution: iComplexity: iFinancial istatements iare icomplex, ithe i i amounts iare

ioften iaffected i by isignificant iestimates, iand ithe idisclosures ioften irequire isignificant i i knowledge iand

iexperience ito i evaluate. iMost ifinancial istatement iusers ido inot ihave ithe i i accounting iand ilegal

iknowledge i to iassess ithe i reasonableness iof icomplex iaccounting iand i i disclosure ichoices ibeing imade

iby ithe i company.




6. In ifinancial iaccounting, ithe ibalance isheet iis ia istatement iof ifinancial iposition
A. True
B. False
Answer: iA, iTaxonomy: iKnowledge, iDifficulty: iEasy, iAICPA iPC: iCommunication, iAACSB: iAnalytic, i i Learning
i Objective: iLO1.3, iSolution: iIn ifinancial iaccounting, ithe ifinancial istatements iinclude i the i i balance isheet

i (statement iof ifinancial iposition), iincome istatement i(statement iof icomprehensive i i income), istatement iof

icash i flows, istatement iof ichanges iin iequity iand iaccompanying inotes.




7. Business ivaluation ifalls iwithin ithe ipurview iof inon-assurance iservices.
A. True
B. False
Answer: iA, iTaxonomy: iKnowledge, iDifficulty: iEasy, iAICPA iFC: iMeasurement iAnalysis iand i i Interpretation,
i AACSB: iAnalytic, iLearning iObjective: iLO1.4, iSolution: iMany iof ithese iaccounting i i firms iprovide inon-

i assurance i(or inon-audit) iservices ias iwell ias iassurance iservices. iThese inon- i i assurance iservices

iinclude i management iconsulting, ibusiness ivaluation, imergers iand i i acquisitions, iinsolvency, itax iand

iaccounting i services.




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