TEST BANK
Auditing & Assurance Services: A Systematic Approach
William F. Messier Jr
11th Edition
PR
O
FD
O
C
,Table of Contents
Part I: The Contemporary Auditing Environment
1. An Introduction to Assurance and Financial Statement Auditing
2. The Financial Statement Auditing Environment
3. Audit Planning, Types of Audit Tests, and Materiality
Part II: Risk Assessment
4. Risk Assessment
5. Evidence and Documentation
6. Internal Control in a Financial Statement Audit
7. Auditing Internal Control over Financial Reporting
Part III: Responding to Assessed Risks
8. Audit Sampling: An Overview and Application to Tests of Controls
PR
9. Audit Sampling: An Application to Substantive Tests of Account Balances
10. Auditing Revenue and Related Accounts
11. Auditing Purchasing and Payment Process
12. Auditing the Human Resource Management Process
13. Auditing the Inventory Management Process
O
14. Auditing the Financing and Investing Process: Prepaid Expenses,
Intangibles, and Payroll
15. Auditing the Financing and Investing Process: Long-Term Liabilities,
Stockholders’ Equity, and Income Statement Accounts
FD
Part IV: Completing the Audit and Reporting Responsibilities
16. Completing the Audit Engagement
17. Reports on Audited Financial Statements
18. Professional Conduct, Independence, and Quality Control
O
Part V: Other Assurance and Non-assurance Services
C
19. Legal Liability
20. Assurance, Attestation, and Internal Auditing Services
Appendices
A. Professional Standards
B. Audit Reports and Illustrations
C. Selected Accounting and Auditing Pronouncements
D. Glossary
E. Index
,Auditing & Assurance Services: A Systematic Approach, 11e (Messier)
Chapter 1 An Introduction to Assurance and Financial Statement Auditing
1) Auditing focuses on rules, techniques, and computations required to prepare and analyze
financial information.
Answer: FALSE
Difficulty: 1 Easy
Topic: The Importance for Studying Auditing
Learning Objective: 01-01 Understand why studying auditing can be valuable to you whether or
not you plan to become an auditor, and why it is different from studying accounting.
Bloom's: Remember
AACSB: Communication
AICPA: BB Legal; FN Decision Making
PR
2) Decision makers demand reliable information that is provided by accountants.
Answer: TRUE
Difficulty: 1 Easy
Topic: The Demand for Auditing and Assurance
Learning Objective: 01-02 Understand the demand for auditing and be able to explain the
O
desired characteristics of auditors and audit services through an analogy to a house inspector and
a house inspection service.
Bloom's: Understand
FD
AACSB: Communication
AICPA: FN Decision Making; BB Industry
3) Information asymmetry seldom occurs.
Answer: FALSE
O
Difficulty: 2 Medium
Topic: The Demand for Auditing and Assurance
Learning Objective: 01-02 Understand the demand for auditing and be able to explain the
C
desired characteristics of auditors and audit services through an analogy to a house inspector and
a house inspection service.
Bloom's: Apply
AACSB: Communication
AICPA: BB Industry; FN Reporting
, 4) Conflicts of interest often occur between absentee owners and managers.
Answer: TRUE
Difficulty: 2 Medium
Topic: The Demand for Auditing and Assurance
Learning Objective: 01-02 Understand the demand for auditing and be able to explain the
desired characteristics of auditors and audit services through an analogy to a house inspector and
a house inspection service.
Bloom's: Apply
AACSB: Communication
AICPA: BB Industry; FN Reporting
5) Auditing services and attestation services are the same.
Answer: FALSE
PR
Difficulty: 1 Easy
Topic: Auditing, Attest, and Assurance Services Defined
Learning Objective: 01-03 Understand the relationships among auditing, attestation, and
assurance services.
Bloom's: Understand
AACSB: Communication
O
AICPA: BB Industry; FN Reporting
6) Auditing is a type of attest service.
FD
Answer: TRUE
Difficulty: 1 Easy
Topic: Auditing, Attest, and Assurance Services Defined
Learning Objective: 01-03 Understand the relationships among auditing, attestation, and
assurance services.; 01-04 Know the basic definition of a financial statement audit.
O
Bloom's: Understand
AACSB: Communication
AICPA: BB Industry; FN Reporting
C
7) Testing all transactions that occurred during the period is cost prohibitive.
Answer: TRUE
Difficulty: 2 Medium
Topic: The Audit Process
Learning Objective: 01-06 Be able to explain why on most audit engagements an auditor tests
only a sample of transactions that occurred.
Bloom's: Apply
AACSB: Communication
AICPA: FN Decision Making; BB Critical Thinking
Auditing & Assurance Services: A Systematic Approach
William F. Messier Jr
11th Edition
PR
O
FD
O
C
,Table of Contents
Part I: The Contemporary Auditing Environment
1. An Introduction to Assurance and Financial Statement Auditing
2. The Financial Statement Auditing Environment
3. Audit Planning, Types of Audit Tests, and Materiality
Part II: Risk Assessment
4. Risk Assessment
5. Evidence and Documentation
6. Internal Control in a Financial Statement Audit
7. Auditing Internal Control over Financial Reporting
Part III: Responding to Assessed Risks
8. Audit Sampling: An Overview and Application to Tests of Controls
PR
9. Audit Sampling: An Application to Substantive Tests of Account Balances
10. Auditing Revenue and Related Accounts
11. Auditing Purchasing and Payment Process
12. Auditing the Human Resource Management Process
13. Auditing the Inventory Management Process
O
14. Auditing the Financing and Investing Process: Prepaid Expenses,
Intangibles, and Payroll
15. Auditing the Financing and Investing Process: Long-Term Liabilities,
Stockholders’ Equity, and Income Statement Accounts
FD
Part IV: Completing the Audit and Reporting Responsibilities
16. Completing the Audit Engagement
17. Reports on Audited Financial Statements
18. Professional Conduct, Independence, and Quality Control
O
Part V: Other Assurance and Non-assurance Services
C
19. Legal Liability
20. Assurance, Attestation, and Internal Auditing Services
Appendices
A. Professional Standards
B. Audit Reports and Illustrations
C. Selected Accounting and Auditing Pronouncements
D. Glossary
E. Index
,Auditing & Assurance Services: A Systematic Approach, 11e (Messier)
Chapter 1 An Introduction to Assurance and Financial Statement Auditing
1) Auditing focuses on rules, techniques, and computations required to prepare and analyze
financial information.
Answer: FALSE
Difficulty: 1 Easy
Topic: The Importance for Studying Auditing
Learning Objective: 01-01 Understand why studying auditing can be valuable to you whether or
not you plan to become an auditor, and why it is different from studying accounting.
Bloom's: Remember
AACSB: Communication
AICPA: BB Legal; FN Decision Making
PR
2) Decision makers demand reliable information that is provided by accountants.
Answer: TRUE
Difficulty: 1 Easy
Topic: The Demand for Auditing and Assurance
Learning Objective: 01-02 Understand the demand for auditing and be able to explain the
O
desired characteristics of auditors and audit services through an analogy to a house inspector and
a house inspection service.
Bloom's: Understand
FD
AACSB: Communication
AICPA: FN Decision Making; BB Industry
3) Information asymmetry seldom occurs.
Answer: FALSE
O
Difficulty: 2 Medium
Topic: The Demand for Auditing and Assurance
Learning Objective: 01-02 Understand the demand for auditing and be able to explain the
C
desired characteristics of auditors and audit services through an analogy to a house inspector and
a house inspection service.
Bloom's: Apply
AACSB: Communication
AICPA: BB Industry; FN Reporting
, 4) Conflicts of interest often occur between absentee owners and managers.
Answer: TRUE
Difficulty: 2 Medium
Topic: The Demand for Auditing and Assurance
Learning Objective: 01-02 Understand the demand for auditing and be able to explain the
desired characteristics of auditors and audit services through an analogy to a house inspector and
a house inspection service.
Bloom's: Apply
AACSB: Communication
AICPA: BB Industry; FN Reporting
5) Auditing services and attestation services are the same.
Answer: FALSE
PR
Difficulty: 1 Easy
Topic: Auditing, Attest, and Assurance Services Defined
Learning Objective: 01-03 Understand the relationships among auditing, attestation, and
assurance services.
Bloom's: Understand
AACSB: Communication
O
AICPA: BB Industry; FN Reporting
6) Auditing is a type of attest service.
FD
Answer: TRUE
Difficulty: 1 Easy
Topic: Auditing, Attest, and Assurance Services Defined
Learning Objective: 01-03 Understand the relationships among auditing, attestation, and
assurance services.; 01-04 Know the basic definition of a financial statement audit.
O
Bloom's: Understand
AACSB: Communication
AICPA: BB Industry; FN Reporting
C
7) Testing all transactions that occurred during the period is cost prohibitive.
Answer: TRUE
Difficulty: 2 Medium
Topic: The Audit Process
Learning Objective: 01-06 Be able to explain why on most audit engagements an auditor tests
only a sample of transactions that occurred.
Bloom's: Apply
AACSB: Communication
AICPA: FN Decision Making; BB Critical Thinking
