ACCT 320 Final Exam Questions and Answers Already Passed
Generally Accepted Standards of Auditing - Answers 1.The auditor must have adequate technical
training and proficiency.
2.The auditor must have independence of mental attitude
3.The auditor must exercise due professional care in the performance of the audit and the preparation
of the report.
Auditing Standards of Field Work - Answers 1.Audit work must be adequately planned.
2.The auditor must gain a sufficient understanding of the internal control structure.
3.The auditor must obtain sufficient, competent evidence.
Auditing Reporting Standards - Answers 1.The auditor must state in the report whether financial
statements were prepared in accordance with generally accepted accounting principles.
2.The report must identify those circumstances in which generally accepted accounting principles were
not applied.
3.The report must identify any items that do not have adequate informative disclosures.
4.The report shall contain an expression of the auditor's opinion on the financial statements as a whole.
Phases of an Audit - Answers Audit Planning Phase
1. Review of organization's policies, practices, and structure.
2. Review general controls and application controls
, 3. Plan tests of controls and substantive testing procedures
Test of Controls Phase
4. Perform tests on controls
5. Evaluate test results
6. Determine degree of reliance on controls
Substantive Testing Phase
7. Perform substantive tests
8. Evaluate results and issue auditor's report
9. Audit Report
Audit Objective of Existence - Answers Inventories listed on the balance sheet exist.
Audit Procedure of Existence - Answers Observe the counting of physical inventory.
Audit Objective of Completeness - Answers Accounts payable include all obligations to vendors for the
period.
Audit Procedure of Completeness - Answers Compare receiving reports, supplier invoices, purchase
orders, and journal entries for the period and the beginning of the next period.
Audit Objective of Rights and Obligations - Answers Plant and equipment listed in the balance sheet are
owned by the entity.
Generally Accepted Standards of Auditing - Answers 1.The auditor must have adequate technical
training and proficiency.
2.The auditor must have independence of mental attitude
3.The auditor must exercise due professional care in the performance of the audit and the preparation
of the report.
Auditing Standards of Field Work - Answers 1.Audit work must be adequately planned.
2.The auditor must gain a sufficient understanding of the internal control structure.
3.The auditor must obtain sufficient, competent evidence.
Auditing Reporting Standards - Answers 1.The auditor must state in the report whether financial
statements were prepared in accordance with generally accepted accounting principles.
2.The report must identify those circumstances in which generally accepted accounting principles were
not applied.
3.The report must identify any items that do not have adequate informative disclosures.
4.The report shall contain an expression of the auditor's opinion on the financial statements as a whole.
Phases of an Audit - Answers Audit Planning Phase
1. Review of organization's policies, practices, and structure.
2. Review general controls and application controls
, 3. Plan tests of controls and substantive testing procedures
Test of Controls Phase
4. Perform tests on controls
5. Evaluate test results
6. Determine degree of reliance on controls
Substantive Testing Phase
7. Perform substantive tests
8. Evaluate results and issue auditor's report
9. Audit Report
Audit Objective of Existence - Answers Inventories listed on the balance sheet exist.
Audit Procedure of Existence - Answers Observe the counting of physical inventory.
Audit Objective of Completeness - Answers Accounts payable include all obligations to vendors for the
period.
Audit Procedure of Completeness - Answers Compare receiving reports, supplier invoices, purchase
orders, and journal entries for the period and the beginning of the next period.
Audit Objective of Rights and Obligations - Answers Plant and equipment listed in the balance sheet are
owned by the entity.
