ABA Audit & Attestation Services 2

Question 1

Which type of audit opinion is issued when financial statements are presented fairly in all material respects in accordance with GAAP?

Accepted Answer

Unmodified opinion

Answer

An unmodified (clean) opinion means the auditor found no material misstatements and the statements conform to GAAP.

Question 2

An auditor discovers that the client's management has intentionally misstated inventory values. This situation most likely requires the auditor to:

Accepted Answer

Withdraw from the engagement

Answer

Intentional misstatement by management (fraud) impairs the auditor-client relationship and typically requires withdrawal from the engagement.

Question 3

Under attestation standards, a practitioner performing an agreed-upon procedures engagement reports findings to:

Accepted Answer

Specified parties who agreed to the procedures

Answer

Agreed-upon procedures reports are restricted to the specified parties who agreed to and are responsible for the sufficiency of the procedures.

Question 4

Which sampling method gives every item in the population an equal chance of being selected?

Accepted Answer

Simple random sampling

Answer

Simple random sampling ensures each item has an equal and independent probability of selection, making it statistically representative.

Question 5

Analytical procedures used during the planning phase of an audit are primarily intended to:

Accepted Answer

Identify unusual relationships that may indicate risk areas

Answer

Planning-stage analytical procedures help identify areas with higher risk of misstatement so the auditor can allocate resources effectively.

(ABA) Accredited Business Accountant Practice Test