CPA Auditing and Attestation (AUD) : CPA Auditing and Attestation (AUD)
Study concepts, example questions & explanations for CPA Auditing and Attestation (AUD)
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Example Questions
Example Question #1 : Fraud Vs Error
Misstatements discovered by an auditor were immaterial in the aggregate in prior years. Such misstatements should be:
Considered in the current year evaluation of audit findings
Disclosed by the current year client’s financial statements
Retested during the current year test of controls
Removed from the prior year summary because they were immaterial
Considered in the current year evaluation of audit findings
Misstatements discovered by an auditor were immaterial in the aggregate in prior years. Such misstatements should be considered in the current year evaluation of audit findings.
Example Question #3 : Fraud Vs Error
Prior to or during the information gathering procedures for an audit, team members should discuss the potential for material misstatement dur to fraud. Of the following, which best characterizes the mind set that the audit team should maintain during this discussion?
Questioning
Criticizing
Judgemental
Presumptive
Questioning
During an audit, the CPA should maintain an attitude of professional skepticism which includes a questioning mind and a critical assessment of audit evidence.
Example Question #4 : Fraud Vs Error
Of the following, which best characterizes the auditor's exercise of professional skepticism?
Having a questioning mind and attitude
Taking past relationships and experiences with management into account
Conducting all fraud-related inquiries in a respectful manner
Obtaining adequate evidence in support of the fairness of financial statements
Having a questioning mind and attitude
Professional skepticism is an attitude that includes a questioning mind and a critical assessment of audit evidence.
Example Question #1 : Fraud Vs Error
An employee at a company being audited may be more likely to commit fraud if he or she feels which of the following?
All of the answer choices are correct
Opportunity
Pressure
Rationalization
All of the answer choices are correct
These three factors in the fraud environment are the key components of the reasons someone would commit fraud.
Example Question #1 : Audit Sampling
Logical Checks include:
Limit Tests
Check Digits
Validity checks
All of the above
All of the above
Logical checks include: validity checks, limit checks and check digits
Example Question #2 : Audit Sampling
Test Data
data used to check management for fraud
all of the above
data used to test the sample size
includes erroneous information
includes erroneous information
Test data will include erroneous data. The purpose of using erroneous data is to assess the system capability of validating data. It uses erroneous data to locate and identify the source of the error.
Example Question #3 : Audit Sampling
As an audit test, John James CPA uploaded client data to its software and compared the results to the client output. This is an example of
Validity Checks
Check digits
Embedded audit modules
Parallel simulation
Parallel simulation
This is an example of a parallel simulation. The auditor compares the output received from its system with the output received from the client system.
Example Question #51 : Cpa Auditing And Attestation (Aud)
Of the following computer-assisted auditing techniques allows fictitious and real transactions to be processed together without client operating personnel being aware of the testing process?
Integrated test facility
Data entry monitor
Parallel simulation
Input control matrix
Integrated test facility
An integrated test facility uses test data commingled with actual data to test transactions.
Example Question #52 : Cpa Auditing And Attestation (Aud)
Processing data through the use of simulated files provide an auditor with information about the operating effectiveness of controls. One of the techniques involved in this approach makes use of:
Input validation
Controlled reprocessing
Program code checking
An integrated test facility
An integrated test facility
An integrated test facility runs test transactions through the live system and posts to simulated files to provide an auditor with information about the operating effectiveness of controls.
Example Question #1 : Audit Sampling
When an engagement team confronts a difficulty in their audit due to a lack of understanding of a certain component of IT, the team should resort to which option?
Assume fraudulent activity
Trust management's word
Abandoning the testing area
Pursuing an independent IT specialist
Pursuing an independent IT specialist
When there is an area of testing which the engagement team feels it would need additional expertise in, the correct option would be to work with a specialist in the field rather than make assumptions, give up, or blindly trust.
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