ACCA SP Advanced Audit & Assurance 2

Question 1

Which of the following is an example of 'self-review threat' to auditor independence?

Accepted Answer

The audit firm prepared the financial statements it is now auditing

Answer

A self-review threat arises when the auditor reviews or relies on work they or their firm previously produced — such as auditing financial statements the firm prepared.

Question 2

Under ISA 530, 'audit sampling' involves:

Accepted Answer

Applying audit procedures to less than 100% of items in a population to draw conclusions about the whole population

Answer

Audit sampling (ISA 530) involves selecting a representative sample from a population and applying audit procedures to it, enabling the auditor to draw conclusions about the entire population.

Question 3

An 'emphasis of matter' paragraph differs from an 'other matter' paragraph in that:

Accepted Answer

Emphasis of matter refers to a matter disclosed in the financial statements; other matter refers to something outside the financial statements

Answer

Emphasis of matter (ISA 706) draws attention to a matter properly disclosed in the financial statements. Other matter paragraphs refer to matters relevant to users that are outside the financial statements.

Question 4

Under ISAE 3000, a 'review engagement' provides:

Accepted Answer

Limited assurance — the practitioner concludes nothing has come to their attention indicating a material misstatement

Answer

A review engagement (ISAE 3000) provides limited (negative) assurance. The practitioner states that nothing has come to their attention to indicate the subject matter is materially misstated — a lower level than reasonable assurance.

Question 5

Professional scepticism in an advanced audit context requires the auditor to:

Accepted Answer

Maintain a questioning mind, critically assess evidence, and be alert to conditions indicating fraud or error, without being predisposed to disbelieve management

Answer

Professional scepticism (ISA 200) is a critical mindset alert to conditions suggesting fraud or error. It requires evaluation of evidence quality and does not assume management is either honest or dishonest a priori.

ACCA Strategic Professional Practice Test

ACCA Strategic Professional Practice Test

ACCA SP Advanced Audit & Assurance 2