Multiple choice questions:

Q1: In establishing the overall audit strategy, the auditor shall:

1. Identify the characteristics of the engagement that define its scope

2. Ascertain the nature, timing and extent of resources necessary to perform the engagement

3. Ascertain the reporting objective of the engagement to plan the timing of the audit and the nature of the communication required

4. Consider the factors that, in the auditors professional judgement are significant in directing the engagement team.

3 only

1, 2 and 3 only

1, 2 ,3 and 4

1 and 2 only

Q2: Managements assessment of the entitys ability to continue as a going concern involves making a judgment Which of the following is/are the factors that are relevant to managements judgment?

1. The degree of uncertainty associated with the outcome of an event or condition

2. The size and complexity of the entity.

3. The nature and condition of its business.

1,2 and 3

.2 Only.

1 and 3 Only.

1 Only.

Q3: As per ISA 700, Which of the following is/are the auditors responsibilities in case of group audit?

1. Obtain sufficient appropriate audit evidence regarding the financial information of the entities within the group.

2. The direction, supervision and performance of the group audit.

3. Document the audit plans followed by the group auditors.

1 and 2 only

1, 2 and 3

2 and 3 only

1 and 3 only

Q4: As per ISA 570, If the auditor believes that there is a significant delay in the approval of financial statements. Auditor shall:

1. Express qualified opinion.

2. Inquiry the management or TCWG reasons for the delay.

3. Perform additional audit procedure.

4. Express unmodified opinion.

1 and 2 only

3 and 4 only

2 and 4 only

2 and 3 only

Q5: Which of the following shall the auditor do if, he/she encounters exceptional circumstances and is unable to continue the audit engagement?

1. Determine the professional and legal responsibilities applicable in the circumstances.

2. Discuss with the friends and the other auditing firm.

3. Discuss with the employees and labour union.

4. Discuss with the appropriate level of management and TCWG.

1 and 3 Only

1 and 4 Only

1 and 2 only

1, 2 and 4 only

Q6: Which of the following financial events or conditions may cast significant doubt on the entitys ability to continue as a going concern?

1. Emergence of a highly successful competitor.

2. Substantial operating losses.

3. Rearrangement with creditors for reduction in liability and inability to pay.

4. Management intentions to liquidate the entity or to cease operations

1 and 4 only

3 and 4 only

1 and 3 only

1 and 2 only

Q7:

Which of the following is not a part of the Substantive analytical procedure?

1. Test made to obtain evidence of material errors

2. Assessing the risk of material misstatement.

3. determine the necessity to modify the opinion in auditors report

4. Test of the details of the transactions.

1, 2 & 3

3 only

1 & 2 only

1 only

Q8: Which of the following should be made to cover the audit plan?

1. Establishing the expected degree of reliance to be placed on internal control.

2. Acquiring knowledge of the clients accounting systems, policies and internal control procedures.

3. Determining and programming the nature, timing, and extend of the audit procedures to be performed.

3 only

1 & 2 only

1, 2 & 3

1 only

Q9: As per ISA 500, Which of the following is/are the analytical Procedures?

1. Substantive test designed to assess control risk

2. Substantive test designed to evaluate the validity of Managements representation letter.

3. Substantive test designed to study relationship between financial and non-financial data

1 & 2 only

1 only

3 only

1, 2 & 3

Q10: Under what circumstances auditor may express an unqualified opinion?

1. The view presented by the financial information as a whole is consistent with the auditor's knowledge of the business of the entity.

2. The view presented by the financial information as a whole is inconsistent with the auditor's knowledge of the business of the entity.

3. The auditor concludes that the possible effects on the financial statements of undetected misstatements are both material and pervasive.

1, 2, and 3

1 only

1 and 4 only

2 and 3 only

Q11: As per ISA 700, what is/are the additional auditors responsibilities to be mentioned under the section of Auditors responsibilities for the financial statements?

1. Identify the assess the risk of material misstatement.

2. Obtain the understanding of the internal control

3. Evaluate the appropriateness of accounting polices used.

4. Conclusion on the management use of going concern basis.

1 and 4 only

1 and 2 only

1, 2, 3 and 4

1, 2 and 3

Q12: If the auditor identify and assess the risk of material misstatement due to fraud or error relating entitys related activities. The auditor shall:

1. Inquiry with management and others within the entity.

2. Perform other risk assessment procedures.

3. Inquiry with auditor firm and labour union.

2 and 3 only

1, 2 and 3 only

1 and 2 only

1 and 3 only