18 Questions
Which of the following is NOT a risk assessment procedure the auditor should perform to obtain an understanding of the entity and its environment, including its internal control?
Analytical procedures
What is the primary purpose of the audit risk model?
For planning purposes in determining how much evidence to accumulate
Which of the following is most likely to identify an abnormal fluctuation in gross profit that might suggest the need for extended audit procedures for sales and inventories during the planning phase of the audit?
Analytical procedures
What is the primary purpose for internal auditors to review the adequacy of the company's internal control system?
To determine whether the internal control system ensures that financial statements are fairly presented
Which of the following is NOT a risk assessment procedure the auditor should perform to obtain an understanding of the entity and its environment, including its internal control?
Performing substantive procedures
Which of the following is the primary purpose of the audit risk model?
For planning purposes in determining how much evidence to accumulate
What is the primary purpose of assessing the adequacy of the available evidential matter during audit planning?
To provide assurance that potential material misstatement will be identified
Which of the following is the most accurate statement about the role of analytical procedures in an audit?
Analytical procedures may provide the best available information for the completeness assertion
Which of the following is the primary purpose of the auditor's review of the company's internal control system?
To provide reasonable assurance that the company's objectives and goals are met efficiently and economically
Which of the following best describes the role of analytical procedures in providing assurance about the completeness assertion?
Analytical procedures may provide the best available information for the completeness assertion
What is the primary purpose of using analytical procedures during the planning stage of an audit?
To enhance the auditor's understanding of the client's business
Which of the following is the most important role of the auditor's review of the internal control system?
To provide reasonable assurance that the company's objectives and goals are met efficiently and economically
What is the primary objective of an auditor's assessment of control risk?
To determine the extent of reliance on internal controls for substantive testing
Which of the following procedures is not part of an auditor's assessment of control risk?
Performing tests of details of transactions to detect material misstatements
If an auditor assesses control risk at a lower level, what impact does it have on the planned level of detection risk?
The planned level of detection risk can be decreased
Which of the following scenarios would not warrant a reduction in the planned level of detection risk?
The auditor identifies significant deficiencies in the entity's internal control system
Which of the following services is least likely to be structured as an attest engagement?
A consulting engagement to develop a new database system for the revenue cycle
If an auditor plans to rely on the assessments of inherent risk and control risk, what impact would it have on the planned level of detection risk?
The planned level of detection risk would need to be decreased
Test your knowledge on an auditor's assessment of control risk with this quiz. Identify the step that is not a part of the process of assessing control risk. Evaluate your understanding of internal control effectiveness and tests of details of transactions.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
