Professional Standards in Auditing

Questions and Answers

What type of engagements are tested in the Auditing and Attestation section?

Engagements exclusively related to governmental entities

Only employee benefit plan audits

Only audits of issuers and nonissuers

Engagements including audits and other assurance services (correct)

Which auditing standards apply to audits of nonissuers?

Public Company Accounting Oversight Board Standards (PCAOB AS)

International Financial Reporting Standards (IFRS)

Statements on Auditing Standards (SAS) (correct)

Generally Accepted Accounting Principles (GAAP)

What is the primary purpose of PCAOB AS?

To offer guidelines for audits of public companies (correct)

To provide standards exclusively for governmental audits

To establish accounting principles for nonissuers

To define ethical guidelines for accountants

In the context of the described engagements, what does the term 'special reports' refer to?

Reports related to nonissuer audits as well as other services Signup and view all the answers

What is a characteristic of SAS regarding interim financial statements?

They guide the review of interim financial statements when annual statements have been audited Signup and view all the answers

Which of the following statements is NOT true regarding the audits of issuers?

Audits of issuers are governed by SAS Signup and view all the answers

Which standard setting body is responsible for establishing guidelines for public company audits?

Public Company Accounting Oversight Board (PCAOB) Signup and view all the answers

Which of the following does NOT fall under the Auditing and Attestation section?

Personal financial planning services Signup and view all the answers

Study Notes

Auditing and Attestation Overview

Covers audits of issuers, nonissuers, governmental entities, not-for-profit entities, and employee benefit plans.
Includes various types of engagements such as accounting reviews, nonaudit engagements, and assurance engagements.
Requires adherence to ethical guidelines and applicable standards for each specific engagement.

Professional Standards and Guidelines

Engagements covered include audits, review of interim financial information, and letters to underwriters.
Fundamental to audit engagements is compliance with Generally Accepted Auditing Standards (GAAS).
Specific standards and guidelines are categorized by standard-setting bodies, including AICPA and PCAOB.

Standard Setting Bodies

Statements on Auditing Standards (SAS):
- Set by AICPA for audits of nonissuers.
- Provide guidance for services such as interim financial reviews.
- Applicable for annual historical financial statements for nonissuers and special reports.
PCAOB Auditing Standards (PCAOB AS):
- Developed for audits of issuers.
- Offer guidance on services, including reviews of interim financial information and letters to underwriters.
- Relevant for audits of annual historical financial statements for issuers and special reports.
Generally Accepted Government Auditing Standards (GAGAS):
- Issued by the Government Accountability Office (GAO).
- Provide guidelines for audits of governmental programs and entities receiving government funds.
- Focus on performance audits and compliance audits related to government funding.

Key Engagements

Audit engagements necessitate following the respective standards to ensure accuracy and compliance.
Special reports may be required by both issuers and nonissuers under their specific guidelines.

Description

This quiz covers the fundamental professional standards in the Auditing and Attestation section. It focuses on various types of audits including those for issuers, non-issuers, governmental entities, and non-profit organizations. Additionally, the quiz includes topics on engagements such as accounting reviews and assurance services.