Test Bank for Auditing An International Approach 7th Edition- Test Bank

Sample Test c3 Student: ______________________________________________________________ _____________ 1 . Which of the following philosophical principles in ethics places emphasis on the importance of following rules rather than on weighing the consequences of actions? A. Kantian principle. B. Utilitarian principle. C. Consequentialism principle. D. Moral principle. Test Bank for Auditing An International Approach 7th Edition- Test Bank 2 . Which of the following philosophical principles of ethics places emphasis on the consequences of action, rather than on following the rules? A. Imperative principle. B. Utilitarianism principle. C. Generalization principle. D. Moral principle. 3 . What is a key characteristic of critical thinking? A. It is a means of eliminating alternatives to arrive at one right answer. B. It requires making the right assumptions to support an argument. C. It requires a questioning mind. D. It is a means of picking out things wrong with another person’s argument. 4 . The goal of the critical-thinking framework reflects ________. A. independence B. ideal audit virtues C. skepticism D. ethics 5 . What is the meaning of the rule of professional conduct that requires an auditor to be objective? A. The auditor may have a material, indirect financial interest in a client’s business as long as it does not affect his B. The auditor has an obligation to CPA Canada to not use his or her training for personal advantage. C. The auditor has an obligation to serve the needs of the audit client. D. The auditor must have an attitude of professional skepticism toward an auditee’s management. 6 . The CPA Ontario Rules of Professional Conduct contain both general ethical principles that are idealistic in character and also a ________. A. list of violations that would cause the automatic suspension of a member’s license B. set of specific, mandatory rules describing minimum levels of conduct required of members C. description of the procedures to be followed by a member who must respond to an inquiry from the disciplinar D. list of specific acts discreditable to the profession 7 . Which of the following items is the most important principle in the “fundamental statements of accepted conduct”? A. Maintain the reputation of the profession. B. Act with due care. C. Maintain independence. D. Act with professional courtesy. 8 . A complaint has been made against a member for an audit failure. If this complaint is found to have merit, under which CPA Ontario Rule of Professional Conduct is the member likely to be charged? A. 202 Integrity and due care. B. 204 Independence. C. 210 Conflict of interest. D. 215 Contingent fees. 9 . A succinct, but comprehensive definition of independence is that an auditor ________. A. must be independent in fact and in appearance in order to maintain credibility B. must not have a direct financial interest in a client C. must have a license to practice as a public accountant D. must not take on as an audit client a company owned by a member of his or her immediate family 1 0 . The familiarity threat refers to ________. A. becoming too sympathetic to a client’s interests B. providing assurance on one’s own work C. promoting a client’s position or opinion D. benefiting from a financial interest in a client 1 1 . In the course of performing an audit, an auditor begins dating the CFO of the auditee. What kind of threat to independence might arise?