Balance-related audit objectives are usually applied to the ending balance in income statement accounts; transaction-related audit objectives are usually applied to transactions reflected in balance sheet accounts.

True

False

Auditors have less responsibility for recovery of employee fraud than for errors.

Truer

False

The effect of a violation of the existence transaction-related audit objective for the sales account would be an overstatement of that account

True

False

The effect of a violation of the completeness transaction-related audit objective for cash disbursements transactions would be an understatement of cash disbursements

True

False

The transaction-related audit objective that deals with whether recorded transactions have actually occurred is the completeness objective

True

False

The general balance-related audit objective that deals with determining that details in the account balance agree with related master file amounts, foot to the total in the account balance, and agree with the total in the general ledger is the accuracy objective.

True

False

The cut-off objective transaction eat the balance sheet date are recorded in the proper period is, a transaction-related, not a balance-related audit objective.

True

False

When an auditor has reduced assessed control risk based on the identification of controls, he or she may then reduce the extent to which the accuracy of the financial statement information directly related to those controls must be supported through the accumulation of evidence

True

False

Tess of controls are normally performed only on those internal controls the auditor believes have not been operating effectively during the period under audit.

True

False

Test of details of balances typically involve the use of comparisons and relationships to assess the overall reasonableness of account balances.

True

False

Other than inquiring of management about policies they have established to prevent illegal acts and whether management knows of any laws or regulations that the company has violated, the auditor should nor search for indirect-effect illegal acts unless there is reason to believe they may exist

True

False

An audit generally provides no assurance that indirect-effect illegal acts will be detected

True

False

When an auditor believes that an illegal act may have occurred, the first step he or she should take is to inquire of management at a level above those to be involved in the potential illegal act.

True

False