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Chapter 1: INTRODUCTION AND OVERVIEW OF AUDIT AND ASSURANCE 7) In Canada, publicly traded companies are a) required to have audits. b) strongly encouraged to

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Chapter 1: INTRODUCTION AND OVERVIEW OF AUDIT AND ASSURANCE 7) In Canada, publicly traded companies are a) required to have audits. b) strongly encouraged to have audits. c) not required to have an audit if they have a review. d) not required to have an audit. primary difference between internal and external auditors The 8) What is the primary difference between intern a) level of competence required. b) parties to whom the auditor is responsible. c) type of audit that is being completed d) all of the above inancial statement audit? 9) Which of the following best describes the purpose of a financial stateme a) To provide an opinion on whether the company is run effectively b) To assist management with the preparation of the vear-end financial staten c) To assess whether the financial statements are fairly presented in accordance all material respects d) To provide shareholders with a guarantee that there are no errors in the financial statements are fairly presented in accordance with IFRS, in rors in the financial 10) Performance audits are generally performed by internal auditors or government auditors. The primary purpose of an operational audit is to provide: a) To aid the independent auditors with the financial statement audit b) To assess whether the company's processes are efficient and effective -) To review operational management to ensure they are complying with company policies ) To ensure that individuals are completing their tax returns properly extbook Homework Assignment to be ready for Day 2 Self-Test Questions (page 1-31): #1.1 to 1.5 Review Questions (page 1-31): #1.3 & #1.4 rofessional Application Questions (page 1-32): #1.1 & 1.2 SO Day 2 Chapter 1: INTRODUCTION AND OVERVIEW OF AUDIT AND ASSURANCE-CONTD CHECK IN QUESTIONS: 1) An audit engagement provides a) moderate assurance. b) negative assurance. c) absolute assurance. d) reasonable assurance. 2) A compilation engagement provides which type of assurance? a) moderate assurance. (b) no assurance. c) absolute assurance. d) reasonable assurance. 3) An audit report is generally addressed to the @shareholders. b) management. c) company. d) none of the above. 4) During an audit, which of the following is false with regards to materiality @ Professional judgment is very important when determining materiality b) If an auditor finds accounting errors that are not material, they do not need to track them c) If an accounting error is immaterial but is due to fraud, the auditor must investigate further d) Immaterial errors identified in the previous year audit should be tracked and considered when performing the current year audit e) None of the above 5) Which of the following engagements would involve audit procedures such as confirmations and inspections? a) review engagement b) compilation engagement audit engagement ch o colat d) All of them 10 FMGT3310 - AUDIT 1

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