AUD

AUD practice questions, page 27 of 41, with answer review and explanations.

Question 131

Which of the following procedures would an auditor most likely perform to obtain evidence about the occurrence of subsequent events?

  1. Recomputing a sample of large-dollar transactions occurring after year-end for arithmetic accuracy.
  2. Investigating changes in stockholders' equity occurring after year-end.
  3. Inquiring of the entity's legal counsel concerning litigation, claims, and assessments arising after yearend.
  4. Confirming bank accounts established after year-end.

Question 132

What is an auditor's responsibility for supplementary information required by the GASB that is placed outside the basic financial statements?

  1. Label the information as unaudited and expand the auditor's report to include a disclaimer on the information.
  2. Add an explanatory paragraph to the auditor's report and refer to the information as "required supplementary information."
  3. Apply limited procedures to the information and report deficiencies in, or the omission of, the information.
  4. Audit the required supplementary information in accordance with generally accepted governmental auditing standards.

Question 133

An auditor's responsibility to express an opinion on the financial statements is:

  1. Implicitly represented in the auditor's standard report.
  2. Explicitly represented in the opening paragraph of the auditor's standard report.
  3. Explicitly represented in the scope paragraph of the auditor's standard report.
  4. Explicitly represented in the opinion paragraph of the auditor's standard report.

Question 134

When an independent CPA assists in preparing the financial statements of a publicly held entity, but has not audited or reviewed them, the CPA should issue a disclaimer of opinion. In such situations, the CPA has no responsibility to apply any procedures beyond:

  1. Ascertaining whether the financial statements are in conformity with generally accepted accounting principles.
  2. Determining whether management has elected to omit substantially all required disclosures.
  3. Documenting that the internal control structure is not being relied on.
  4. Reading the financial statements for obvious material misstatements.

Question 135

An auditor issued an audit report that was dual dated for a subsequent event occurring after the original date of the auditor's report. The auditor's responsibility for events occurring subsequent to the original date was:

  1. Extended to subsequent events occurring through the date of reissuance of the report.
  2. Extended to include all events occurring since the original date of the auditor's report.
  3. Limited to the specific event referenced.
  4. Limited to include only events occurring up to the date of the last subsequent event referenced.