AICPA Auditing and Attestation 2

Question 1

An auditor discovers that a client's internal control over cash disbursements is weak. Which audit response is most appropriate?

Accepted Answer

Increase substantive testing over cash disbursements

Answer

When control risk is assessed as high, auditors compensate by performing more extensive substantive procedures in the affected area.

Question 2

Which type of analytical procedure compares current-year financial ratios to prior-year ratios and industry benchmarks?

Accepted Answer

Ratio analysis

Answer

Ratio analysis evaluates relationships between financial statement items and compares them to historical data and industry norms to identify unusual fluctuations.

Question 3

Under PCAOB standards, an integrated audit requires the auditor to express opinions on which two items?

Accepted Answer

Financial statements and internal control over financial reporting

Answer

PCAOB AS 2201 requires auditors of public companies to opine on both the financial statements and the effectiveness of internal control over financial reporting.

Question 4

When an auditor is unable to obtain sufficient appropriate audit evidence about a material account balance, the appropriate audit report modification is:

Accepted Answer

Qualified opinion or disclaimer of opinion

Answer

A scope limitation that is material but not pervasive results in a qualified opinion; if pervasive, the auditor issues a disclaimer of opinion.

Question 5

Which sampling method gives every item in a population an equal and nonzero chance of selection?

Accepted Answer

Random sampling

Answer

Random sampling (probabilistic) ensures each population item has an equal chance of selection, supporting valid statistical inference.

(AICPA) American Institute of Certified Public Accountants Practice Test

(AICPA) American Institute of Certified Public Accountants Practice Test

AICPA Auditing and Attestation 2