CPA Audit Exam Questions and
answers. 100% Accurate. Rated A+
What does TID stand for in the GAAS general standards? - ✔✔-Training, Independence, and Due
professional care
What does PIE stand for in the standards of field work? - ✔✔-Planning and supervision, Internal Control,
and Evidence
What does GCDO stand for in the standards of reporting? - ✔✔-GAAP, Consistency, Disclosure, and
Opinion
When is an adverse opinion rendered? - ✔✔-When a severe GAAP departure is present in the financial
statements.
What are the two main differences between the standards of attestation and the auditing standards? -
✔✔-The attestation standards and generally accepted auditing standards differ conceptually in two
main areas: 1) the attestation standards provide a framework for the attest function beyond historical
financial statements; and 2) the attestation standards provide for the growing number of attest services
in which the practitioner expresses assurances in forms other than the positive opinion.
Formula for days sales in acc receivable? - ✔✔-Acc rec / credit sales per day.Credit sales per day = Total
credit sales / 365.
Adj entry for wages at end of year that weren't recorded: - ✔✔-DR: Operating expensesCR: Accrued
wages payable(accrued liab)
Why would an auditor modify the auditor's report based on the work of a specialist? - ✔✔-If there is a
difference between the specialist's valuation of an asset and the client's.
, who should make up the audit committee? - ✔✔-members of the board or directors who are not
officers or employees
what are the 3 general standards? - ✔✔-adequete training, independence of mental attitude, and due
professional care
3 fieldwork standards? - ✔✔-adequete planning, understanding the entity and its internal control,
sufficient and appropriate audit evidence
the auditors judgment of the overall fairness of the financial statements is applied within the framework
of? - ✔✔-generally accepted audit principles
what does the auditor primarily use to come up with materiality? - ✔✔-the prior year financial
statements
basics of independence concerning a close relative? - ✔✔-CR can have a financial interest in the audit
client as long as the amount is immaterial to them. CR can work for the audit client as long as its not in
accounting or financial reporting. CR can work for audit firm, and is not a covered member unless the
person works on the engagement team or can influence the members of the engagement team or the
audit itself
when planning a new audit, why would the auditor consider the methods used to process accounting
information? - ✔✔-Because the methods influence the design of internal control
who appoints the PCAOB? - ✔✔-SOX created the PCAOB and it is overseen by the SEC
under securities act of 1934 what organizations are required to submit audited financial statements? -
✔✔-every company traded on national and over the counter exchanges
primary purpose of establishing quality control procedures for deciding whether to accept a new client?
- ✔✔-minimize likelihood of association with clients whose management lack integrity
answers. 100% Accurate. Rated A+
What does TID stand for in the GAAS general standards? - ✔✔-Training, Independence, and Due
professional care
What does PIE stand for in the standards of field work? - ✔✔-Planning and supervision, Internal Control,
and Evidence
What does GCDO stand for in the standards of reporting? - ✔✔-GAAP, Consistency, Disclosure, and
Opinion
When is an adverse opinion rendered? - ✔✔-When a severe GAAP departure is present in the financial
statements.
What are the two main differences between the standards of attestation and the auditing standards? -
✔✔-The attestation standards and generally accepted auditing standards differ conceptually in two
main areas: 1) the attestation standards provide a framework for the attest function beyond historical
financial statements; and 2) the attestation standards provide for the growing number of attest services
in which the practitioner expresses assurances in forms other than the positive opinion.
Formula for days sales in acc receivable? - ✔✔-Acc rec / credit sales per day.Credit sales per day = Total
credit sales / 365.
Adj entry for wages at end of year that weren't recorded: - ✔✔-DR: Operating expensesCR: Accrued
wages payable(accrued liab)
Why would an auditor modify the auditor's report based on the work of a specialist? - ✔✔-If there is a
difference between the specialist's valuation of an asset and the client's.
, who should make up the audit committee? - ✔✔-members of the board or directors who are not
officers or employees
what are the 3 general standards? - ✔✔-adequete training, independence of mental attitude, and due
professional care
3 fieldwork standards? - ✔✔-adequete planning, understanding the entity and its internal control,
sufficient and appropriate audit evidence
the auditors judgment of the overall fairness of the financial statements is applied within the framework
of? - ✔✔-generally accepted audit principles
what does the auditor primarily use to come up with materiality? - ✔✔-the prior year financial
statements
basics of independence concerning a close relative? - ✔✔-CR can have a financial interest in the audit
client as long as the amount is immaterial to them. CR can work for the audit client as long as its not in
accounting or financial reporting. CR can work for audit firm, and is not a covered member unless the
person works on the engagement team or can influence the members of the engagement team or the
audit itself
when planning a new audit, why would the auditor consider the methods used to process accounting
information? - ✔✔-Because the methods influence the design of internal control
who appoints the PCAOB? - ✔✔-SOX created the PCAOB and it is overseen by the SEC
under securities act of 1934 what organizations are required to submit audited financial statements? -
✔✔-every company traded on national and over the counter exchanges
primary purpose of establishing quality control procedures for deciding whether to accept a new client?
- ✔✔-minimize likelihood of association with clients whose management lack integrity
