1. ch 1

Which of the following is considered an assurance engagement?

(1) Bookkeeping (3) Compilation (2) Preparation (4) Audit

2. Which of the following engagements is most likely to be considered an operational audit?

(1) The auditor evaluates the organizations efficiency in processing payments. (2) The auditor examines information presented in an entitys financial statements to determine whether the financial statements are presented fairly in accordance

with the applicable financial reporting framework. (3) The auditor determines whether the organization is following provisions of laws

and regulations. (4) The auditor assists the client in preparation of financial statements.

3. In a financial statement audit, the auditor obtains a reasonable level of assurance about whether the financial statements are free of material misstatement in order to express an opinion. In order to obtain reasonable assurance, the auditor must (1) have prior experience in the industry in which the audit client operates.

(2) examine all documents available that support the financial statements. (3) obtain sufficient audit evidence. (4) test controls around significant transaction cycles.

ch2

An auditor of an entity subject to the rules of the SEC must conduct the financial statement audit in accordance with (1) PCAOB standards. (2) Statements on Standards for Accounting and Review Services.

(3) International Auditing Standards. (4) Generally Accepted Government Auditing Standards.

Which of the following provides authoritative guidance for the auditor of a nonpublic company?

(1) An article in the Journal of Accountancy that discusses new audit requirements (2) Information obtained from continuing professional education programs (3) Publication from state CPA societies that provides questions and answers on frequently asked audit questions (4) Statements on Auditing Standards

The Public Company Accounting Oversight Board (PCAOB) has the duty to (1) select the public accounting firm for the issuers annual audit. (2) establish rules related to the preparation of audit reports for nonissuers. (3) conduct investigations concerning registered public accounting firms. (4) conduct disciplinary proceedings for nonpublic accounting firms.