AUD

AUD practice questions, page 23 of 41, with answer review and explanations.

Question 111

Investment and property schedules are presented for purposes of additional analysis in an auditor submitted document. The schedules are not required parts of the basic financial statements, but accompany the basic financial statements. When reporting on such additional information, the measurement of materiality is the:

  1. Same as that used in forming an opinion on the basic financial statements taken as a whole.
  2. Lesser of the individual schedule of investments or schedule of property taken by itself.
  3. Greater of the individual schedule of investments or schedule of property taken by itself.
  4. Combined total of both the individual schedules of investments and property taken as a whole.

Question 112

What is an auditor's responsibility for supplementary information which is outside the basic financial statements, but required by the FASB?

  1. The auditor has no responsibility for required supplementary information as long as it is outside the basic financial statements.
  2. The auditor's only responsibility for required supplementary information is to determine that such information has not been omitted.
  3. The auditor should apply certain limited procedures to the required supplementary information, and report deficiencies in, or omissions of, such information.
  4. The auditor should apply tests of details of transactions and balances to the required supplementary information, and report any material misstatements in such information.

Question 113

Which of the following best describes the auditor's reporting responsibility concerning information accompanying the basic financial statements in an auditor- submitted document?

  1. The auditor has no reporting responsibility concerning information accompanying the basic financial statements.
  2. The auditor should report on the information accompanying the basic financial statements only if the auditor participated in its preparation.
  3. The auditor should report on the information accompanying the basic financial statements only if the auditor did not participate in its preparation.
  4. The auditor should report on all the information included in the document.

Question 114

When audited financial statements are presented in a client's document containing other information, the auditor should:

  1. Perform inquiry and analytical procedures to ascertain whether the other information is reasonable.
  2. Add an explanatory paragraph to the auditor's report without changing the opinion on the financial statements.
  3. Perform the appropriate substantive auditing procedures to corroborate the other information.
  4. Read the other information to determine that it is consistent with the audited financial statements.

Question 115

An auditor may report on condensed financial statements that are derived from complete audited financial statements if the:

  1. Auditor indicates whether the information in the condensed financial statements is fairly stated in all material respects.
  2. Condensed financial statements are presented in comparative form with the prior year's condensed financial statements.
  3. Auditor describes the additional review procedures performed on the condensed financial statements.
  4. Condensed financial statements are distributed only to management and the board of directors.