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Questions and Answers
Which of the following is a major audit planning activity?
Which of the following is a major audit planning activity?
- Performing preliminary analytical procedures
- Establishing materiality and assessing risk
- Obtaining an understanding of the client and its environment (correct)
- Assessing the possibility of non-compliance
What does the term 'non-compliance' refer to in the context of an audit?
What does the term 'non-compliance' refer to in the context of an audit?
- Acts of omission or commission by the entity being audited (correct)
- Acts of omission or commission by the auditor
- Acts of omission or commission by both the auditor and the entity being audited
- Acts of omission or commission by external parties
What is the purpose of establishing materiality and assessing risk in audit planning?
What is the purpose of establishing materiality and assessing risk in audit planning?
- To reduce audit risk to an acceptably low level (correct)
- To identify related parties
- To determine the audit strategy
- To develop the audit plan
Which of the following statements about the relationship between tolerable misstatement and audit procedures is true?
Which of the following statements about the relationship between tolerable misstatement and audit procedures is true?
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When should analytical procedures be performed during an audit?
When should analytical procedures be performed during an audit?
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What is the primary objective of performing analytical procedures in the planning stage of an audit?
What is the primary objective of performing analytical procedures in the planning stage of an audit?
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