Question 5

Which of the following best describes the concept of risk assessment on which auditors can provide independent assurance?

1) The risk that financial statements are misstated because of fraud.

2) The risk that financial statements are misstated because of error or fraud.

3) Whether management has systems in place to evaluate and effectively manage the entity's business risks.

4) Developing client acceptance and continuance practices that minimize the likelihood of lawsuits against the auditor.

Question 6

The three PCAOB general standards are concerned with

1) Adequate training and proficiency of the auditor, proper planning and supervision, and due professional care.

2) Adequate training and independence.

3) Due professional care.

4) Independence, adequate training and due professional care.