Multiple Choice Questions!!

Please choose the correct answers wisely.

1) During the audit the independent auditor identified the existence of a weakness in the client's internal control and communicated this finding in writing to the client's senior management and those charged with governance. The auditor should :

a) Consider the weakness a scope limitation and therefore disclaim an opinion.

b) Suspend all audit activities pending directions from the client's audit committee.

c) Withdraw from the engagement.

d) Consider the effects of the condition on the audit.

2) Which of the following would require the auditor to increase the level of control testing for a particular control?

a) The control is performed monthly instead of daily.

b) There are several controls relating to a particular audit objective.

c) The WCGW addressed by the control is not very important.

d) A high degree of reliance is to be placed on the control to limit the amount of substantive testing required.

3) The auditor decides which controls to test by considering:

a) the points at which fraud or error can occur.

b) the nature of controls implemented by management.

c) the significance of each control in achieving its control objective.

d) All of these answers choices are correct.