SECTION A Question 1,2 and 3 QUESTION 1 1.1 Which of the following is NOT set out as a component of internal control within ISA 315? A. Control environment B. The information system relevant to financial reporting C. Human resource policies and practices

1.2. Which of the following processes could be described as control activities? (i) Approval by a manager of documents. (ii) Computer controls. (iii) Disclosure of documents to the auditor. (iv) Arithmetical checks. (v) Repair of Non-Current Assets. A. (iii) only B. All the above C. (i), (ii) & (iv) only D. (i) & (ii) only

1.3. Which of the following may indicate that an entity has a weak control environment? A. The directors are very aware of the importance of internal controls and act to implement them. B. There is a limited human resources budget with many staff undertaking more than one role. C.The entity has a very bureaucratic organizational structure. 1.4. In the purchases cycle within an entity the control objectives at the stage of placing a purchase order will be: i) To ensure that the item purchased is not already in stock. ii) To ensure that the stock count is accurate. iii) To ensure that the order is actually required. iv) To ensure that all orders are paid for. A. All the above. B. (i) iii) and iv) only. C. (i) only D. (i) and iii) only.

1.5. Juntary Co. has high value inventory which is stored in a secure location. How can the auditor test whether this control is being carried out? A. Observe the location and inspect the security procedures to ensure they are adequate. B. For a sample of invoices ensure that the delivery address matches that of the secure location. C. For a sample of invoices, ensure that the orders are only made for goods that are not in stock.

1.6. Which of the following are areas of the financial statements for which the assertions differ? i) Transactions and events. 2 ii) Nominal codes. iii) Ledger accounts. iv) Disclosures. v) Account balances. A. All of the above. B. ii) & iii) only. C. i) ii) & v) only. D. i) iv) & v) only.

1.7. Which of the following are the assertions for transactions and events? A. Occurrence, Completeness, Accuracy, Cut-off & Classification. B. Existence, Rights and obligations, Completeness & Valuation. C. Occurrence, Rights and obligations, Completeness, Valuation, Allocation & Classification/understandability.

1.8. Which of the following describes a substantive test? i) A test of the details in the financial statements. ii) A test of an assertion. iii) A test of a balance. A. ii) only B. iii) only C. All the above

1.9. Analytical procedures can be described as: A. A review of expectations based on ratio analysis, trends and industry information. B. Ratio analysis to predict what next years figures may look like. C. Industry analysis to evaluate technological advances.

1.10. Which of the following is a procedure that the auditor could use to verify existence of receivables? A. Add up the aged receivable listing. B. Undertake a receivables circularisation. C. Re-calculate the bad debt write-off amount. D. Check with companies house that each debtor is a legitimate company.