CGAP MCQ 4

Question 1

Which of the following situations would most likely impair an auditor's independence under GAGAS?

Accepted Answer

The auditor's spouse is a senior manager at the audited entity

Answer

A close family member in a key management position at the audited entity creates a personal impairment to independence under GAGAS.

Question 2

The 'efficiency' component of a government performance audit measures:

Accepted Answer

The cost per unit of output produced

Answer

Efficiency measures the relationship between outputs produced and resources consumed, often expressed as cost per unit of output.

Question 3

An auditee disagrees with the auditor's finding in a draft report. The appropriate GAGAS procedure is to:

Accepted Answer

Include the auditee's response and the auditor's evaluation of it in the final report

Answer

GAGAS requires that auditee responses to findings be included in the report along with the auditor's assessment of those responses.

Question 4

Which document establishes the scope, objectives, and methodology for a specific government audit engagement?

Accepted Answer

Audit program

Answer

The audit program documents the specific procedures, scope, and objectives for the current engagement and guides fieldwork.

Question 5

Under GASB standards, which basis of accounting is used for governmental funds?

Accepted Answer

Modified accrual basis

Answer

Governmental funds use the modified accrual basis, recognizing revenues when measurable and available, and expenditures when a fund liability is incurred.

CGAP - Certified Government Auditing Professional Practice Test

CGAP - Certified Government Auditing Professional Practice Test

CGAP MCQ 4