Accounting

5 years ago

Effective internal control in a small company that has an insufficient number of employees to permit ...

Effective internal control in a small company that has an insufficient number of employees to permit proper division of responsibilities can best be enhanced by
A) employment of temporary personnel to aid in the segregation of duties.
B) di

npeelman 70 1 Reply

charleshardt

6 years ago

A major control available in a small company, which might not be feasible in a large company, is

A major control available in a small company, which might not be feasible in a large company, is
A) a wider segregation of duties.
B) use of sequentially numbered documents.
C) fewer transactions to process.
D) the owner-manager&#

npeelman 135 2 Replies

5 years ago

An essential characteristic of the persons performing internal check procedures is

An essential characteristic of the persons performing internal check procedures is
A) independence from the original data preparer.
B) a thorough knowledge of accounting.
C) an analytical and inquisitive mind.
D) competence in dat

npeelman 79 1 Reply

6 years ago

The chart of accounts is an important control because it provides the framework for determining the ...

The chart of accounts is an important control because it provides the framework for determining the information presented to management and other financial statement users. What type of errors is the chart of accounts helpful in preventing? It helps

npeelman 56 1 Reply

6 years ago

Which of the following duties would indicate a weakness in internal controls? The

Which of the following duties would indicate a weakness in internal controls? The
A) accounting function is under the controller.
B) custodianship of cash is the responsibility of the treasurer's function.
C) internal auditor repo

npeelman 97 2 Replies

5 years ago

An example of general computer control systems that provide reasonable assurance of authorization of ...

An example of general computer control systems that provide reasonable assurance of authorization of application systems is
A) operations and information systems support.
B) systems, acquisition, development and maintenance controls.
C

npeelman 70 1 Reply

6 years ago

FiddleWare Limited uses purchased packaged application software to handle the processing of its ...

FiddleWare Limited uses purchased packaged application software to handle the processing of its transactions. An important control that management should implement with respect to information systems is the
A) use of a formal systems development

npeelman 55 2 Replies

5 years ago

The methods that management uses to supervise the entity's activities are called

The methods that management uses to supervise the entity's activities are called
A) personnel practices.
B) management control methods.
C) methods of assigning authority and responsibility.
D) management's operating styl

npeelman 44 2 Replies

5 years ago

To help with corporate governance and a positive "tone at the top," the board of ...

To help with corporate governance and a positive "tone at the top," the board of directors and its committees, such as the audit committee, should
A) rubber stamp the financial statements once per year.
B) consist of all members o

npeelman 122 2 Replies

5 years ago

You, PA, have been assigned as in charge auditor of a long-time audit client of your firm, Mikla ...

You, PA, have been assigned as in charge auditor of a long-time audit client of your firm, Mikla Tool Inc. (MTI). MTI is owned by George Mikla, an experienced machinist. George established the business over 20 years ago, and it has grown into a $10 m

npeelman 85 2 Replies

5 years ago

Joan is the owner of a small manufacturing company. In prior years, your firm has conducted a review ...

Joan is the owner of a small manufacturing company. In prior years, your firm has conducted a review engagement of the company. However, this year, Joan obtained a loan from the federal business development bank, and is required to have an audit of h

npeelman 281 3 Replies

Nick Jones1

3 years ago

Fraud risk factors are examples of factors that increase the risk of fraud. Which of the following ...

Fraud risk factors are examples of factors that increase the risk of fraud. Which of the following is an example of a management "opportunities" risk factor?
A) The company has lost a major account and income is falling.
B) Two ma

npeelman 76 2 Replies

5 years ago

It is important for the public accountant to consider the competence of the audit clients' ...

It is important for the public accountant to consider the competence of the audit clients' employees because their competence bears directly and importantly upon the
A) cost/benefit relationship of internal controls.
B) achievement of

npeelman 64 1 Reply

6 years ago

Internal controls can never be regarded as completely effective. Even if systems personnel could ...

Internal controls can never be regarded as completely effective. Even if systems personnel could design an ideal system, its effectiveness depends on the
A) adequacy of the computer system.
B) proper implementation by management.
C) ab

npeelman 57 2 Replies

5 years ago

Which one of the following controls would be of concern to management, but not to the auditor? ...

Which one of the following controls would be of concern to management, but not to the auditor? Controls over the
A) collection of accounts receivable amounts.
B) entry of payroll wage rates into the computer systems.
C) distribution of

npeelman 50 2 Replies

5 years ago

Management's objectives with respect to internal control include

Management's objectives with respect to internal control include
A) having reasonable assurance that the financial statements are in accordance with IFRS or ASPE.
B) ensuring that all policies and procedures are clearly documented to r

npeelman 83 1 Reply

6 years ago

A system of internal control consists of policies and procedures designed to provide management ...

A system of internal control consists of policies and procedures designed to provide management with
A) reasonable assurance that the company achieves its objectives.
B) assurance that fraud will be prevented.
C) reasonable assurance t

npeelman 104 2 Replies

5 years ago

A major benefit of computerized analytical procedures is the

A major benefit of computerized analytical procedures is the
A) ease of doing the calculations.
B) ease of updating the calculations.
C) ease of correcting math calculations.
D) ability to push the work down to lower levels of the

npeelman 48 2 Replies

5 years ago

A common comparison occurs when the auditor calculates the expected balance and compares it with the ...

A common comparison occurs when the auditor calculates the expected balance and compares it with the actual balance. The auditor's expected account balance may be determined by
A) using industry standards.
B) using credit bureau report

npeelman 60 2 Replies

5 years ago

When the current year's unaudited trial balance amounts are compared to the prior year's audited ...

When the current year's unaudited trial balance amounts are compared to the prior year's audited trial balance amounts,
A) errors are identified.
B) discrepancies are discovered.
C) irregularities become apparent.
D) sig

npeelman 49 1 Reply

6 years ago

An important benefit of industry comparisons is as

An important benefit of industry comparisons is as
A) an aid to understanding the client's performance.
B) an indicator of errors.
C) an indicator of irregularities.
D) a least-cost indicator for audit procedures.

npeelman 57 1 Reply

6 years ago

For some audit objectives and in some circumstances, analytical procedures may be the most effective ...

For some audit objectives and in some circumstances, analytical procedures may be the most effective procedure to apply. The objectives that most likely would benefit from the use of analytical review with respect to the allowance for uncollectible a

npeelman 72 1 Reply

6 years ago

When a higher than normal ratio of long-term debt to net worth is coupled with a lower than average ...

When a higher than normal ratio of long-term debt to net worth is coupled with a lower than average ratio of profits to total assets, the company
A) is highly successful.
B) is comparable with industry standards.
C) has a high risk of

npeelman 72 1 Reply

6 years ago

The Bank of New Haven relies heavily on computers to calculate the settlements of amounts due to ...

The Bank of New Haven relies heavily on computers to calculate the settlements of amounts due to other banks. Given that the process is highly automated, the auditor would not be able to obtain sufficient evidence with substantive procedures. The aud

npeelman 37 2 Replies

5 years ago

Most auditors prefer to replace external confirmation with analytical procedures whenever possible ...

Most auditors prefer to replace external confirmation with analytical procedures whenever possible because the
A) analytical procedures are more reliable.
B) external confirmations are more expensive.
C) analytical procedures are more

npeelman 69 1 Reply

6 years ago

Which one of the following forms of evidence would be least reliable?

Which one of the following forms of evidence would be least reliable?
A) monthly bank statement
B) positive confirmation of customer's balance
C) a letter from client's lawyer stating that there are no known lawsuits pending

npeelman 70 2 Replies

5 years ago

Which one of the following forms of evidence would be least persuasive in forming the auditor's ...

Which one of the following forms of evidence would be least persuasive in forming the auditor's opinion?
A) the auditor's count of marketable securities
B) correspondence with a stockbroker regarding the quantity of client's

npeelman 57 2 Replies

5 years ago

Below are 12 audit procedures. Classify each procedure according to the following types of audit ...

Below are 12 audit procedures. Classify each procedure according to the following types of audit evidence: (1) inspection, (2) external confirmation, (3) recalculation, (4) observation, (5) inquiry of the client, (6) reperformance, and (7) analytical

npeelman 110 2 Replies

5 years ago

Although considerable evidence is obtained from the client through inquiry, it usually cannot be ...

Although considerable evidence is obtained from the client through inquiry, it usually cannot be regarded as conclusive because
A) the client may not have sufficient knowledge to answer the question.
B) it is not from an independent source

npeelman 79 2 Replies

5 years ago

There are six factors that affect the reliability of audit evidence. One factor is the independence ...

There are six factors that affect the reliability of audit evidence. One factor is the independence of the provider; i.e., evidence obtained from a source outside the client company is more reliable than that obtained within. Identify and discuss the

npeelman 58 1 Reply

6 years ago

Identify and explain the three determinants of the persuasiveness of evidence.

npeelman 62 2 Replies

5 years ago

Inspection of assets is not a sufficient form of evidence when the auditor wants to determine the

Inspection of assets is not a sufficient form of evidence when the auditor wants to determine the
A) existence of the asset.
B) quantity and description of the asset.
C) condition or quality of the asset.
D) ownership of the asset

npeelman 54 2 Replies

5 years ago

For income statement accounts, evidence is more persuasive if there is a sample from

For income statement accounts, evidence is more persuasive if there is a sample from
A) the entire period under audit.
B) the period closest to the end of the fiscal period.
C) at least three months of the fiscal year.
D) December

npeelman 43 1 Reply

6 years ago

Which of the following is an example of subjective evidence?

Which of the following is an example of subjective evidence?
A) a positive confirmation of an account receivable
B) a bank confirmation
C) inquiries of the credit manager about the collectability of noncurrent accounts receivable

npeelman 60 1 Reply

6 years ago

Which of the following is the best example of objective evidence?

Which of the following is the best example of objective evidence?
A) a letter written by a client's lawyer discussing the likely outcome of outstanding lawsuits
B) the physical count of securities and cash by the auditor
C) inquir

npeelman 72 2 Replies

5 years ago

Last year, the client's internal controls were weak. This year, the internal controls are stronger. ...

Last year, the client's internal controls were weak. This year, the internal controls are stronger. This means that information recorded on internal documentation is
A) more timely.
B) less reliable.
C) more reliable.
D) less

npeelman 89 1 Reply

charleshardt

6 years ago

To improve the appropriateness of audit evidence, the auditor should

To improve the appropriateness of audit evidence, the auditor should
A) make sure to select a larger sample size for the items being tested.
B) add additional population items into the sample, improving sample variety.
C) select audit

npeelman 84 2 Replies

5 years ago

Evidence is generally considered appropriate when

Evidence is generally considered appropriate when
A) it has the qualities of being relevant, objective, and free from known bias.
B) there is enough of it to afford a reasonable basis for an opinion on financial statements.
C) it has b

npeelman 62 1 Reply

charleshardt

6 years ago

Which of the following characteristics of samples would make the sample more sufficient? Samples ...

Which of the following characteristics of samples would make the sample more sufficient? Samples that contain
A) at least one of each type of transaction that is in the population, and have a high number of sample items.
B) items with a hig

npeelman 103 2 Replies