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Auditing and Assurance Module A

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A business that executes or records transactions on behalf of a client is called -

AT 801 uses the term "service organizations" with regards to these providers. A statement that adequate disclosure has been made concerning accounting policy and practice.....there is no requirement to comment on footnotes that are included with the financial statements. 1. Conducting Inquiry of Management 2. Performing Analytical Procedures 3. Obtaining a Management Representation Letter Less work than an audit but more work than a compilation. Review work extent lies between compilation and audit.

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According to auditing standards, financial statements presented on a special purpose framework should NOT -

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A compilation report should include all of the following EXCEPT:

Contain a note with a quantified dollar reconciliation of the assets based on the special purpose framework with the assets based on Generally Accepted Accounting Principles (GAAP). Review report on unaudited financial statements. An examination of forecasted financial information. Improves the quality of information for decision makers. The website displays the WebTrust seal.

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Accountants are permitted to express "negative assurance" in which of the following reports? An accountant may allow general distribution of reports based on:

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A review of unaudited financial statements consists of:

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An assurance service is defined as a service that:

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A review service engagement involving unaudited financial statements involves:

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B. Harper is surfing the Internet and finds a great pair of rollerblades at a really low price but he has never heard of the company and is concerned that the product he ordered may not be the product he receives. Harper may be more willing to place an order with this company if: During a review of a nonissuer's financial statements, accountants are required to make certain inquiries of management. Which of the following inquiries is NOT required by the SSARS? Even though Sarbanes-Oxley only applies to publicly traded companies, private companies and organizations may request that public accounting firms attest to the effectiveness of their internal controls. Several conditions must be met before a public accounting firm can undertake such an engagement. Which of the following is NOT one of the necessary conditions?

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According to AU 915, "Reports on Application of Requirements of an Appropriate Financial Reporting Framework", which of the following is NOT allowed when writing a report in response to a request for consultation regarding the application of requirements of an appropriate financial reporting framework?

Providing a written report on a hypothetical transaction.

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Internal control deficiencies.

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Management's evaluation of control is to be supported by an internal audit review.

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For a compliance engagement, three conditions must be met. Which of the following is NOT one of the three conditions? If a nonissuer wants an accountant to perform an examination of its internal controls, the accountant should follow:

Management is not required to provide a report attesting to satisfactory compliance. AICPA AT 501, "An Examination of an Entity's Internal Control over Financial Reporting that is Integrated with an Audit of Its Financial Statements." Express an unqualified opinion on a single financial statement. Objectivity and Integrity Agreed-upon procedures Engagement.

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The performance of attestation engagement on prospective financial information does NOT require?

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Management should NOT disclose the probability of obtaining the results included in the prospective financial information. Six Months

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To be useful, an audit of a service organization's controls should over a minimum of: To perform an attestation engagement on prospective information or pro forma information, accountants must do all of the following except? What should be included in an Auditor's report on financial statements prepared under a special purpose framework?

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If the auditor expresses an adverse or disclaimer of opinion on the complete set of financial statements, he or she is not permitted to: In providing assurance services to clients, CPAs are building on their reputations for: Nonaudit clients sometime engage public accounting firms to perform a specified set of audit procedures rather than a complete audit of the financial statements taken as a whole. This type of engagement is called Services in connection with unaudited historical cost financial statements may be provided by: The AICPA Special Committee on Assurance Services (SCAS) identified 8 mega trends that can affect a CPA's business. Which of the following is NOT one of these mega trends identified by the SCAS? The AICPA Special Committee on Assurance Services identified five global "mega trends" that can affect a CPA's business. Which of the following is NOT one of these mega trends? The official Statements on Standards for Accounting and Review Services are applicable to practice with:

Understand the internal controls used in the processes that generated the information. 1. A sentence that identifies the special purpose framework 2. Referral to the special purpose framework in the opinion sentence Compilation report. Notice of lack of independence is enough. Not mention the interim information unless there is an exception that the auditors need to include in the report. Management must present its assertion about the effectiveness of its internal control in a written report. Adequate knowledge of the subject matter.

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When accountants are not independent, which of the following reports can they nevertheless issue? When interim financial information is presented in a footnote to annual financial statements, the standard audit report on the annual financial statements shouldWhich of the following conditions must be met before an accountant can conduct an examination of an entity's internal control? Which of the following is a generally accepted attestation standard but is NOT a fundamental auditing principle. Which of the following is NOT a principle of Trust Services? Which of the following statements is true concerning a compliance audit?

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All CPAs.

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ALL of them: 1. Information Technology 2. Demands for Transparency 3. New social structures The decreasing supply of natural resources.

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Authentication Materiality is difficult to measure in a compliance audit.

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Unaudited Financial Statements of Nonissuers

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Which of the following statements is true concerning interim financial information? Which of the following would NOT be included in an auditor's report on financial statements prepared under a special purpose framework?

The accountant needs to obtain sufficient knowledge of the entity's business and industry before undertaking an engagement on interim financial information. A statement that the financial statements were prepared in accordance with accounting principles generally accepted in the United States of America.

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