31.When would auditors increase the amount of detailed audit procedures used to test the year-end account balances and transactions from throughout the year?

	A.	When the detection risk is low
	B.	When the control risk is low
	C.	When the inherent risk is low
	D.	When the inherent risk in high

32.Which of the following components of the AICPA are enforceable?

	A.	All of the above
	B.	Rules of conduct
	C.	Interpretations
	D.	Principles

33.Which of the following is an amount set by the auditor that is used to make decisions about the extent of audit procedures for a particular class of transaction, account balance, or disclosure?

	A.	Planning materiality
	B.	Performance materiality
	C.	Overall materiality
	D.	Qualitative materiality

34.A threat that a CPA will not appropriately evaluate the results of a previous judgment made by, or service performed by, an individual in the CPA's firm is a(n) __________.

	A.	self-review threat
	B.	advocacy threat
	C.	self-interest threat
	D.	familiarity threat

35.The concept of inherent risk is most closely tied to the idea of _________.

	A.	global risk
	B.	audit risk
	C.	currency risk
	D.	underlying business risks

36.Which of the following statements is true?

1. 1) Securities Exchange Act of 1934 regulates the ongoing trading of securities after the initial public offering and requires the annual audit of a public company's financial statements.

2) The Securities Act of 1933 enhances annual financial disclosures for public

companies and placed more emphasis on corporate responsibility.

	A.	Both 1 and 2
	B.	1 only
	C.	2 only
	D.	Neither

37.Which of the following statements is true?

1. 1). Independence in appearance is avoiding potential conflicts of interest that can be observed by others.

2) In the case ofan embezzlement, the bonding company can bring suits against the CPA for failing to discover the fraud

	A.	1 only
	B.	Both 1 and 2
	C.	Neither
	D.	2 only

38.Which of the following statements is true?

1. 1) Review of financial forecasts falls under attestation services.

2) Business valuation falls within the purview of non-assurance services.

	A.	Neither
	B.	2 only
	C.	Both 1 and 2
	D.	1 only

39.Which of the following statements is true?

1. 1) Among the various processes relating to auditing and assurance standards, the largest umbrella represents assurance services.

1. 2) Examination of non-financial information falls under assurance services and outside of audit services

	A.	Both 1 and 2
	B.	1 only
	C.	Neither
	D.	2 only

40.Auditors gathering evidence that transactions and events have been recorded at appropriate amounts consider _______.

	A.	occurrence
	B.	completeness
	C.	classification
	D.	accuracy

41.Which of the following statements is true?

1. 1). A due care defense is a primary defense against tort actionsjust as it constitutes a contributory negligence defense.

2) In the legal defense the defendant must establish that the plaintiff's loss resulted in whole or in part from causes other than the false or misleading statements.

	A.	2 only
	B.	1 only
	C.	Neither
	D.	Both 1and 2