Questions from General Auditing

Q: Kerry is a senior auditor and a member of the team auditing

Kerry is a senior auditor and a member of the team auditing a long-standing client, the listed public company Darcy Industries Ltd. Kerry’s wife’s uncle died recently and his estate is being finalized...

Q: If an auditor adopts a substantive strategy for the audit, do

If an auditor adopts a substantive strategy for the audit, do they have to consider and test the client’s internal controls? If an auditor adopts a combined audit strategy, do they have to perform any...

Q: Consider the following statement: “If inherent and control risk are

Consider the following statement: “If inherent and control risk are high, the auditor will set detection risk as low, to bring audit risk down.” Explain how setting detection risk as low brings down a...

Q: How does the auditor’s preliminary assessment of materiality affect audit planning?

How does the auditor’s preliminary assessment of materiality affect audit planning? What does an auditor consider when making the preliminary assessment of materiality?

Q: The materiality of an item is assessed relative to a particular base

The materiality of an item is assessed relative to a particular base number. What are some of the choices for this base, and what factors guide the auditor in this choice?

Q: What factors should be considered to determine if an item is qualitatively

What factors should be considered to determine if an item is qualitatively material?

Q: Explain using examples how you could use analytical procedures in assessing the

Explain using examples how you could use analytical procedures in assessing the risk of misstatement of sales revenue

Q: What are some possible explanations of a change in the gross profit

What are some possible explanations of a change in the gross profit margin? How could the auditor investigate which of these explanations is the most likely cause of the change in the ratio?

Q: In what ways are the occurrence and existence assertions similar?

In what ways are the occurrence and existence assertions similar?

Q: Review the examples of working papers provided in the chapter. List

Review the examples of working papers provided in the chapter. List six things that should be included in every working paper.