1. Which of the following is NOT one of the reasons why users demand financial statement audits? a) Users do not have knowledge to be able to make disclosure choices. b) Users may find it difficult to identify when management is presenting biased information c Users would like the auditors to confirm that that management has done an effective job operating the company d) All of the responses are appropriate reasons e) Users do not have access to information themselves

2. Which of the following would an auditor review when understanding the client's industry? a) Major customers b) Warranties & discounts offered to customers c) Employment contracts, relations with employee d) None of the responses provided e) Client's reputation relative to competitors, risk of losing business and profits.

3. Which of the following is an example of a "Non-Assurance" Service? a) Financial statement audit b) Tax return preparation c) All of the responses provided d) Report on the Internal Control over Financial Reporting e) Review engagement of financial statements