1- Which of the following procedures would an auditor likely include in the initial planning of a financial statement audit?

Obtain an attorney's letter

Examining documents to detect illegal acts having a material effect on the financial statements

Considering whether the client's accounting estimates are reasonable in the circumstances

None of the above

2- An auditor would least likely consider which of the following while planning the engagement?

Turnover of personnel in the accounting department

Objectivity of audit committee members

Comments of the client's attorney

Management's plans to repurchase stock

3- Which of the following would cause you the most concern about accepting an engagement?

The existence of related party transactions

Excessive turnover in the accounting department

A large percentage of the potential clients income is generated overseas

The internal auditors report to the controller

4-Which of the following would cause you least concern when deciding to accept an audit engagement?

		The potential clients loss of a major customer
		The existence of related party transactions
		A substantial decrease in the price of the potential clients stock

5- Analytical procedures used in planning an audit should focus on

		Assessing the adequacy of the available evidential matter
		Assessing business risk
		Providing assurance that potential material misstatements will be identified
		None of the above