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.Management Sciences
Category: Introduction to Auditing
Concurrent audit is a part of____________?
A. Internal check system
B. Continuous audit
C. Internal audit system
D. None of these
Which of the following best describes the primary purpose of audit programme preparation?
A. To detect errors or fraud
B. To comply with GAAP appropriate evidence
C. To gather sufficient
D. To assess audit risk
In an audit of financial statements, substantive tests are audit procedures that __________?
A. May be eliminated for an account balance under certain conditions
B. Are designed to discover significant subsequent events
C. Will increase proportionately when the auditor decreases the assessed level of control risk
D. May be test of transactions, test of balance and analytical procedures
Institute of Chartered Accountants of Pakistan was established in____________?
A. 1949
B. 1956
C. 1961
D. 1972
The nature, timing and extent of substantive procedures is related to assessed level of control risk
A. Randomly
B. Disproportionately
C. Directly
D. Inversely
Analytical procedures issued in the planning stage of an audit, generally
A. Helps to determine the nature, timing and extent of other audit procedures
B. Directs attention to potential risk areas
C. Indicates important aspects of business
D. All of the above
Which of the following factors would least likely affect the quantity and content of an auditor’s working papers
A. The assessed level of control risk
B. The possibility of peer review
C. The nature of auditor’s report
D. The content of management representation letter
Which of the following statements is not correct about materiality?
A. Materiality is a relative concept
B. Materiality judgments involve both quantitative and qualitative judgments
C. Auditor’s consideration of materiality is influenced by the auditor’s perception of the needs of an informed decision maker who will rely on the financial statements
D. At the planning state, the auditor considers materiality at the financial statement level only
Which of the following statements is not true about continuous audit?
A. It is conducted at regular interval
B. It may be carried out on daily basis
C. It is needed when the organization has a good internal control system
D. It is expensive
Which of the following affects audit effectiveness?
A. Risk of over reliance
B. Risk of incorrect rejection
C. Risk of incorrect acceptance
D. Both A and C
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