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.Management Sciences
Category: Auditing Mcqs
Auditor of a___________company does not have right to visit foreign branches of the company?
A. Unlimited liability
B. Manufacturing
C. Banking
D. Nonprofit making
Auditing is compulsory for____________?
A. Small scale business
B. Partnership firms
C. Joint stock Companies
D. Proprietary Concerns
The branch auditor is appointed by___________?
A. Shareholders in an annual general meeting
B. Shareholders in general meeting
C. Board of directors in board meeting
D. Any of the above
The basic assumption underlying the use of analytical procedures is:____________?
A. It helps the auditor to study relationship among elements of financial information
B. Relationship among data exist and continue in the absence of known condition to the contrary
C. Analytical procedures will not be able to detect unusual relationships
D. None of the above.
The board of directors shall appoint first auditor of a company
A. With in one month of completion of capital subscription state of the company
B. With in one month of the promotion of the company
C. With in one month of the commencement of the business of the company
D. With in one month of incorporation of the company
Which of the following are fundamental ethical principles for professional accountants?
1 Competence
2 Compliance
3 Integrity
4 Objectivity
A. 1, 2 and 3 only
B. 1, 3 and 4 only
C. 2, 3 and 4 only
D. 1, 2 and 4 only
Balance sheet does not include:_____________?
A. Verification of assets and liabilities
B. Vouching of income and expense accounts related to assets and liabilities
C. Examination of adjusting and closing entries
D. Routine checks
Who out of the following cannot be appointed as a statutory auditor of the company?
A. Erstwhile director
B. Internal auditor
C. Relative of a director
D. Only (B. and (C.
What would most appropriately describe the risk of incorrect rejection in terms of substantive testing?
A. The auditor concludes balance is materially correct when in actual fact it is not
B. The auditor concludes that the balance is materially misstated when in actual fact it not
C. The auditor has rejected an item for sample which was material
D. None of the above
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
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