The decision of how many items to test must be made by the auditor for each audit procedure. The sample size for any given procedure

A. is likely to vary from audit to audit.

B. is focused on highdollarvalue items only.

C. will be the same if the same level of assurance is required.

D. must cover the entire period under audit.

For income statementaccounts, evidence is more persuasive if there is a sample from

A. December, since this would include large holiday sales.

B. the period closest to the end of the fiscal period.

C. at least three months of the fiscal year.

D. the entire period under audit.

A PA is planning the audit ofLowden's Company. Lowden verbally asserts to the PA that all the expenses for the year have been recorded in the accounts.Lowden's representation

A. is sufficient evidence for the PA to conclude that the completeness assertion is supported for the expenses.

B. should be disregarded because it is not in writing.

C. can enable the PA to minimize his work during control testing for the completeness of expenses.

D. is not considered a sufficient basis for the PA to conclude that all expenses have been recorded.

Audit evidence can come in different forms with different degrees of persuasiveness. Which of the following is the least persuasive type ofevidence?

A. bank statement obtained from the client

B. computations made by the auditor

C. avendor's invoice

D. prenumbered client sales invoices

Which one of the following forms of evidence would be leastreliable?

A. a letter fromclient's lawyer stating that there are no known lawsuits pending against client

B. client's file copy of a purchase requisition

C. monthly bank statement

D. positive confirmation ofcustomer's balance

Evidence can be obtained from others or provided by the auditor who has good knowledge of each industry but is not an expert. Which of the following types of evidence is considered to be mostreliable?

A. examination of diamond inventory by the auditor

B. examination of oil and gas reserves by the auditor

C. external confirmations from financial institutions

D. external confirmations from individual owners of condominium units

Inspection of assets is not a sufficient form of evidence when the auditor wants to determine the

A. quantity and description of the asset.

B. existence of the asset.

C. condition or quality of the asset.

D. ownership of the asset.

Observation is an important audit technique where the auditor can usesight, hearing,touch, and smell. Observation needs to be used together with other audit techniques because

A. it is a pointintime technique limited to the time of the observation.

B. it is a highcost technique that is rarely used by auditors.

C. auditors may not accurately observe and interpret what is happening.

D. employees will often perform their procedures consistently over time.

Inquiry is a valuable technique during the planning phase of the audit because it

A. helps obtain information about how procedures and internal controls operate.

B. involves the rechecking of controls to ensure that they are conducted accurately.

C. is conclusive evidence from an independent source.

D. is a type of audit evidence that provides a very high level of assurance.

An example of an external document is

A. employees' time reports.

B. a cancelled cheque.

C. the minutes of the board ofdirectors' meetings.

D. inventory receiving reports.

When comparing the reliability of external versus internaldocuments, the external documents are generally considered

A. less reliable.

B. equally reliable.

C. more reliable.

D. unreliable.

When the auditor examines theclient's documents and records to support recorded transactions oramounts, it is commonly referred to as

A. vouching.

B. physical examination.

C. inquiry.

D. confirmation.

An example of vouching would be to trace from

A. cancelled cheques to the cash disbursement journal.

B. the acquisitions journal to supporting vendor invoices.

C. duplicate bank deposit slips to the cash receipts journal.

D. receiving reports to the acquisitions journal.

"Use of comparisons and relationships to determine whether account balances or other data appearreasonable" is a definition of

A. analytical procedures.

B. tests of balances.

C. tests of controls.

D. auditing.