CPA Auditing and Attestation (AUD) : Compliance, & Government Audits
Study concepts, example questions & explanations for CPA Auditing and Attestation (AUD)
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Example Questions
Example Question #101 : Cpa Auditing And Attestation (Aud)
Each of the following types of controls is considered to be an entity-level control, except those:
Relating to the control environment
Pertaining to the company's risk assessment process
Addressing policies over significant risk management policies
Regarding the company's annual shareholder meeting
Regarding the company's annual shareholder meeting
Entity level controls include controls related to the control environment, the risk assessment process, and the policies over risk management policies. Controls regarding the company's annual shareholder meeting are controls related to a specific event rather than the entity as a whole.
Example Question #102 : Cpa Auditing And Attestation (Aud)
Internal control over financial reporting consists of which component?
Existing control activities
Risk assessment
Monitoring
All of these components
All of these components
The components not listed would include Information and communication and control environment. These 5 components make up ICFR.
Example Question #103 : Cpa Auditing And Attestation (Aud)
Government Accounting Standards
May require a duty to report fraud
Require a written report on internal control
Require a written report on compliance with applicable laws and regulations
All of the answer choices are correct
All of the answer choices are correct
Under GASB standards the auditor is required to report on internal control. The written report is also required to establish compliance with applicable laws and regulations and may require a duty to report fraud.
Example Question #104 : Cpa Auditing And Attestation (Aud)
The Single Audit Act of 1984
Requires one audit firm direct the audits of a state or local government agencies
Requires on government audit per year
Applies to State funding over $750,000
Applies to Federal funding over $750,000
Applies to Federal funding over $750,000
The single audit act of 1984 requires audits of federal funds received over a threshold of $750,000.
Example Question #105 : Cpa Auditing And Attestation (Aud)
Governmental audits fall under standards developed by:
PCAOB
AICPA
None of the answer choices are correct
GAGAS
GAGAS
Governmental auditing standards are developed by the General Accounting Office who publishes Generally Accepted Governmental Audit Standards.
Example Question #106 : Cpa Auditing And Attestation (Aud)
When auditing the financial statements of a governmental entity, the auditor is required to report on A) Noteworthy accomplishments of the program B) The scope of the auditor's testing of internal controls
A
B
Neither
Both
B
When auditing the financial statements of a governmental entity in accordance with GAS, the auditor is required to report on the scope of the auditor's testing of internal control but not on noteworthy accomplishments.
Example Question #107 : Cpa Auditing And Attestation (Aud)
An enterprise engaged a CPA to audit its financial statements in accordance with GAS because of the provisions of government grant funding agreements. Under these circumstances, the CPA is required to report on the enterprise's internal controls either in the report on the financial statements or in:
The report on the performance audit
A letter to the government funding agency
The notes to the financial statements
A separate report
A separate report
The report on the audit of the financial statements should describe the scope of the auditor's testing of compliance with laws and regulations and internal control over financial reporting and should either present the results of those tests or refer to a separate report containing that info.
Example Question #108 : Cpa Auditing And Attestation (Aud)
One of the most notable attributes of governmental audits is that ______.
They ensure absolute assurance
They are the most difficult type of audit
A written report on internal control must be prepared
They demand the highest level of assurance
A written report on internal control must be prepared
This point about governmental audits is heavily tested and the other options are not true about governmental audits.
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