CGAP CGAP 5

Question 1

An audit organization conducting a peer review must have the review completed at least once every:

Accepted Answer

Three years

Answer

GAGAS requires audit organizations to have an external peer review at least once every three years.

Question 2

Which of the following best represents the concept of 'materiality' in a government financial audit context?

Accepted Answer

The magnitude of an omission or misstatement that could influence the judgment of a reasonable user of the financial statements

Answer

Materiality is a judgment about the significance of information to reasonable users' decision-making, not a fixed percentage.

Question 3

A government auditor is testing compliance with grant requirements. The appropriate criteria for the audit would be:

Accepted Answer

The terms of the grant agreement and applicable federal regulations

Answer

Compliance with grant requirements is evaluated against the grant agreement and applicable laws and regulations such as Uniform Guidance.

Question 4

When government auditors communicate findings, which four attributes are generally required?

Accepted Answer

Criteria, condition, cause, and effect (or potential effect)

Answer

GAGAS requires audit findings to include criteria (what should be), condition (what is), cause (why), and effect (impact).

Question 5

A government auditor uses data analytics to identify anomalies in a large dataset of vendor payments. This technique best exemplifies:

Accepted Answer

Computer-assisted audit techniques (CAATs)

Answer

CAATs include using software tools to analyze large volumes of data, identify patterns, and flag anomalies for further investigation.

CGAP - Certified Government Auditing Professional Practice Test