The auditor is comparing expenses as a percentage of net sales with prior years percentages. This is an example of inspection of records and documents. *

True

False

An attitude, character, or set of ethical values exist that allow management or employees to commit a dishonest act ." describes the opportunities condition included in the fraud triangle. *

True

False

Some plant assets items are recorded under the current assets section of the balance sheet. The company violated the accuracy assertion in this case. *

True

False

Detection risk is the measure of the auditor's assessment of the likelihood that there are material misstatements before considering the effectiveness of internal control. *

True

False

Audit sampling is not commonly used to gather analytical procedures audit evidence. *

True

False

The auditor is reviewing the general ledger for unusual large entries. This is an example of scanning. *

True

False

Inexperienced accounting personnel were hired in the accounting department. This case is related to Inherent Risk. *

True

False

Information that is indirectly obtained from external sources is the most reliable audit evidence. *

True

False

The auditor sets the materiality at a low level. This is an example of audit risk. *

True

False

Inherent risk is unaffected by the auditor's experience with client's organization. *

True

False

Audit sampling is commonly used to gather inspection of records and documents audit evidence. *

True

False

The risk of incorrect acceptance relates to the effectiveness of the audit. *

True

False

When vouching entries in sales journal to sales invoices the auditor is testing the completeness assertion. *

True

False

Management has become overly aggressive in reaching target goals. This case is related to Inherent Risk. *

True

False

An example of a fraud risk factor describing incentives/pressures is "ineffective board of director monitoring over financial reporting." *

True

False

Cash is susceptible to theft in a small Company. This is an example of control risk. *

True

False

Expected population deviation rate has a direct effect on sample size. *

True

False

The purchase of Land was completed without any approval. The company violated the authorization assertion in this case. *

True

False

Reliability of evidence refers to the amount of evidence obtained. *

True

False

New accounting principles are applied. This will increase the inherent risk. *

True

False