CHAPTER 2
MULTIPLE CHOICE
a. 1. Due professional care requires
a.A critical review of the work done at every level of supervision.
b.The examination of all corroborating evidence available.
c.The exercise of error-free judgment.
d.A consideration of internal control structure that includes tests of controls.
(AICPA ADAPTED)
c2.The first general standard requires that the audit of financial statements be performed by a person
or persons having adequate technical training and
a.Independence with respect to the financial statements and supplementary disclosures.
b.Exercising professional care as judged by peer reviewers.
c.Proficiency as an auditor, which likely has been acquired from previous experience.
d.Objectivity as an auditor, as verified by proper supervision.(AICPA ADAPTED)
d3.An auditor, while performing an audit, strives to achieve the appearance of independence in order
to
a.Reduce risk and liability.
b.Comply with the generally accepted standards of fieldwork.
c.Become independent in fact.
d.Maintain public confidence in the profession.(AICPA ADAPTED)
d4.Adequate technical training and proficiency as an auditor encompasses an ability to understand a
computer system sufficiently to identify and evaluate
a.The processing and imparting of information.
b.Essential accounting control features.
c.All control procedures.
d.The degree to which programming conforms to the application of generally accepted accounting
principles. (AICPA ADAPTED)
c5.Competence as a certified public accountant includes all of the following except
a.Having the technical qualifications to perform an engagement.
b.Possessing the ability to supervise and evaluate the quality of staff work.
c.Warranting the infallibility of the work performed.
d.Consulting others if additional technical information is needed.(AICPA ADAPTED)
a6.Ultimately, the decision about whether or not an auditor is independent must be made by the
a.Auditor.
b.Client.
c.Audit committee.
d.Public. (AICPA ADAPTED)
7
Why is this page out of focus?
This is a Premium document. Become Premium to read the whole document.
Why is this page out of focus?
This is a Premium document. Become Premium to read the whole document.
The following auditing standard has been rescinded effective as of December 31, 2016 pursuant to SEC Release No. 34-75935, File No. PCAOB-2015-01 (September 17, 2015). See PCAOB
Release No. 2015-002 An independent auditor plans, conducts, and reports the results of an audit in accordance with generally accepted auditing standards (GAAS). Auditing standards provide a measure of audit quality and the objectives to be achieved in an audit. Auditing procedures differ from auditing standards. Auditing procedures are acts that the auditor performs during the course of an audit to comply with auditing standards. The general, field work, and reporting standards (the 10 standards) approved and adopted by the membership of the AICPA, as amended by the AICPA Auditing Standards Board (ASB), are as follows: General Standards Standards of Field Work [The following paragraph is effective for audits of fiscal years beginning on or after December 15, 2010. See PCAOB Release No. 2010-004. For audits of fiscal years beginning before December 15, 2010,
click here.] Standards of Reporting Rule 202, Compliance With Standards, of the
AICPA Code of Professional Conduct [ET section 202.01], requires an AICPA member who performs an audit (the auditor) to comply with standards promulgated by the ASB. fn 1 The ASB develops and issues standards in the form of Statements on Auditing Standards (SASs) through a
due process that includes deliberation in meetings open to the public, public exposure of proposed SASs, and a formal vote. The SASs are codified within the framework of the 10 standards. The auditor should have sufficient knowledge of the SASs to identify those that are applicable to his or her audit. The nature of the 10 standards and the SASs requires the auditor to exercise professional judgment in applying them. Materiality and audit risk also underlie the application of
the 10 standards and the SASs, particularly those related to field work and reporting. [fn 2] The auditor should be prepared to justify departures from the SASs. Interpretive publications consist of auditing Interpretations of the SASs, appendixes to the SASs, fn 3 auditing guidance included in AICPA Audit and Accounting Guides, and AICPA auditing Statements of Position.
fn 4 Interpretive publications are not auditing standards. Interpretive publications are recommendations on the application of the SASs in specific circumstances, including engagements for entities in specialized industries. An interpretive publication is issued under the
authority of the ASB after all ASB members have been provided an opportunity to consider and comment on whether the proposed interpretive publication is consistent with the SASs. [As amended, effective September 2002, by Statement on Auditing Standards No. 98.] The auditor should be aware of and consider interpretive publications applicable to his or her audit. If the auditor does not apply the auditing guidance included in an applicable interpretive publication, the auditor
should be prepared to explain how he or she complied with the SAS provisions addressed by such auditing guidance. Other auditing publications include AICPA auditing publications not referred to above; auditing articles in the Journal of Accountancy and other professional journals; auditing articles in the AICPA CPA Letter; continuing professional education
programs and other instruction materials, textbooks, guide books, audit programs, and checklists; and other auditing publications from state CPA societies, other organizations, and individuals. fn 5 Other auditing publications have no authoritative status; however, they
may help the auditor understand and apply the SASs. If an auditor applies the auditing guidance included in an other auditing publication, he or she should be satisfied that, in his or her judgment, it is both relevant to the circumstances of the audit, and appropriate. In determining whether an other auditing publication is appropriate, the auditor may wish to consider the degree to which the publication is recognized as being helpful in understanding and applying the SASs and
the degree to which the issuer or author is recognized as an authority in auditing matters. Other auditing publications published by the AICPA that have been reviewed by the AICPA Audit and Attest Standards staff are presumed to be appropriate. fn 6 This section is effective for audits of financial statements for periods beginning on or after December 15, 2001. Generally Accepted Auditing Standards
(Supersedes SAS No. 1, section 150)Source: SAS No. 95; SAS No. 98.Effective for audits of financial statements for periods beginning on or after December 15, 2001, unless otherwise indicated..01
Auditing Standards
.02
.03
.04
Interpretive
Publications
.05
.06
Other Auditing Publications
.07
.08
Effective Date
.09