Questions from Auditing and Assurance

Q: How does an entity’s controls over cash receipts and disbursements affect the

How does an entity’s controls over cash receipts and disbursements affect the nature and extent of the auditor’s substantive tests of cash balances?

Q: The primary evidence regarding year-end bank balances is documented in

The primary evidence regarding year-end bank balances is documented in the a. Standard bank confirmations. b. Outstanding check listing. c. Interbank transfer schedule. d. Bank deposit lead schedule....

Q: On receiving the cutoff bank statement, the auditor should vouch

On receiving the cutoff bank statement, the auditor should vouch a. Deposits in transit on the year-end bank reconciliation to deposits in the cash receipts journal. b. Checks dated before year-end li...

Q: Which of the following cash transfers results in a misstatement of cash

Which of the following cash transfers results in a misstatement of cash at December 31?

Q: Which of the following controls would most effectively ensure that the proper

Which of the following controls would most effectively ensure that the proper custody of assets in the investing process is maintained? a. Direct access to securities in the safe-deposit box is limite...

Q: An auditor testing long-term investments would ordinarily use substantive analytical

An auditor testing long-term investments would ordinarily use substantive analytical procedures to ascertain the reasonableness of the a. Existence of unrealized gains or losses in the portfolio. b. C...

Q: To establish the existence and rights of a long-term investment

To establish the existence and rights of a long-term investment in the common stock of a publicly traded company, an auditor ordinarily performs a security count or a. Relies on the entity’s internal...

Q: Which of the following is likely to be the most effective audit

Which of the following is likely to be the most effective audit procedure for verifying dividends earned on investments in publicly traded equity securities? a. Trace deposits of dividend checks to th...

Q: An auditor would most likely verify the interest earned on bond investments

An auditor would most likely verify the interest earned on bond investments by a. Vouching the receipt and deposit of interest checks. b. Confirming the bond interest rate with the issuer of the bonds...

Q: The audit firm’s valuation specialist would likely be brought in to assist

The audit firm’s valuation specialist would likely be brought in to assist in the audit of fair value measurements at an entity when the following is present: a. The entity is a new audit client. b. S...