1. Which of the following is an assertion?

a. A statement made by management regarding the collectability of accounts receivable.

b. The audit firms estimation of the clients inventory obsolescence.

c. The statement by managment regarding the appointment of auditors.

c. The statement by management that the firm will close its branch office because of snow

2. Which of the following source of evidence would be the most reliable:

a. a written confirmation sent by a bank directly to the auditor

b. a written confirmation sent by a debtor to the client

c. a written document produced electronically by a client with good internal controls

d. a written document in the form of a fax sent by a debtor to the client indicating acceptance of a special offer

3. A covered member (i.e., the auditor) will be considered independemt from the client if his or her close relative:

a. has a direct financial interest in the client

b. is an employee of the client in a key position

c. has a financial interest in a client that allows the relative to have an insignificant inflience over the activities of the client

d. has a material indirect financial interest in a client

4. Which of the following is a compensating control for a lack of segregation of duties in a small business enviroment?

a. collusion between an accountant and cahier

b. active involvement and oversight by the owner

c. cumulative access and authority of a super user

d. requirement for an annual physical inventory count

5. Cut-off procedures:

a. can be tested at interim and rolled forward

b. can be tested at any point in the audit

c. apply only to balalnce sheet accounts

d. can only be tested at year end