STRAYER ACC403 MIDTERM EXAM PART 1 AND 2

| November 24, 2016

Question
• 5 out of 5 points

The most common way for users to obtain reliable information is to:

• Question 2

5 out of 5 points

Which of the following is not a SysTrust Services principle as defined by the AICPA?

• Question 3

5 out of 5 points

One objective of an operational audit is to:

• Question 4

5 out of 5 points

An accountant:

• Question 5

0 out of 5 points

Any service that requires a CPA firm to issue a report about the reliability of an assertion that is made by another party is a(n):

• Question 6

5 out of 5 points

The three requirements for becoming a CPA include all but which of the following?

• Question 7

5 out of 5 points

Which of the following is an element of the CPA’s quality control system that should be considered in establishing its quality control policies and procedures?

• Question 8

5 out of 5 points

Which of the following statements best describes the primary purpose of Statements on Auditing Standards?

• Question 9

5 out of 5 points

Which of the following is not one of the responsibilities of an auditor under the principles underlying an audit?

• Question 10

5 out of 5 points

Within the context of quality control, the primary purpose of continuing professional education and training activities is to enable a CPA firm to provide its personnel with:

• Question 11

5 out of 5 points

Statements on Standards for Accounting and Review Services are issued by the:

• Question 12

5 out of 5 points

The purpose of establishing quality control policies and procedures to accept or continue a client relationship is to:

• Question 13

5 out of 5 points

Whenever the client imposes restrictions on the scope of the audit, the auditor should be concerned that management may be trying to prevent discovery of misstatements. In such cases, the auditor will likely issue a:

.

• Question 14

5 out of 5 points

If the phrase “except for” is present in the opinion paragraph of the audit report, the auditor has issued a(n):

• Question 15

5 out of 5 points

Auditing standards for public companies are established by the:

• Question 16

5 out of 5 points

A CPA may wish to emphasize specific matters regarding the financial statements even though an unqualified opinion will be issued. Normally, such explanatory information is:

.

• Question 17

5 out of 5 points

When there is uncertainty about a company’s ability to continue as a going concern, the auditor’s concern is the possibility that the client may not be able to continue its operations or meet its obligations for a “reasonable period of time.” For this purpose, a reasonable period of time is considered not to exceed:

• Question 18

5 out of 5 points

If most or all users’ decisions that are based on the financial statements are likely to be significantly affected, the materiality level is:

• Question 19

0 out of 5 points

Of the four parts of the AICPA’s Code of Professional Conduct, which part is enforceable?

• Question 20

5 out of 5 points

A CPA firm may charge a contingent fee for:

• Question 21

5 out of 5 points

________ means that a person acts according to conscience, regardless of the situation.

• Question 22

5 out of 5 points

Freedom from ________ means the absence of relationships that might interfere with objectivity or integrity.

• Question 23

5 out of 5 points

“Independence” in auditing means:

• Question 24

5 out of 5 points

Which of the following is required for a firm to designate itself “Member of the American Institute of Certified Public Accountants” on its letterhead?

• Question 25

5 out of 5 points

The AICPA’s Code of Professional Conduct states that a CPA should maintain integrity and objectivity. The term “objectivity” in the Code refers to a CPA’s ability to:

• 5 out of 5 points

The standard of due care to which the auditor is expected to adhere to in the performance of the audit is referred to as the:

• Question 2

5 out of 5 points

A broad interpretation of the rights of third-party beneficiaries holds that users that the auditor should have been able to foresee as being likely users of financial statements have the same rights as those with privity of contract. This is known as the concept of:

• Question 3

5 out of 5 points

If an auditor fails to fulfill a certain requirement in the contract, they may be guilty of:

• Question 4

5 out of 5 points

The preferred defense in third party suits is:

• Question 5

5 out of 5 points

Which of the following auditor’s defenses usually means nonreliance on the financial statements by the user?

• Question 6

5 out of 5 points

Laws that have been passed by the U.S. Congress and other governmental units are:

• Question 7

5 out of 5 points

Which of the following would most likely be deemed a direct-effect illegal act?

• Question 8

5 out of 5 points

Management assertions are:

• Question 9

5 out of 5 points

In certifying their annual financial statements, the CEO and CFO of a public company certify that the financial statements comply with the requirements of:

• Question 10

5 out of 5 points

In testing for cutoff, the objective is to determine:

• Question 11

5 out of 5 points

The objective of an audit of the financial statements is an expression of an opinion on:

• Question 12

5 out of 5 points

“The auditor should not assume that management is dishonest, but the possibility of dishonesty must be considered.” This is an example of:

• Question 13

5 out of 5 points

An example of a document the auditor receives from the client, but which was prepared by someone outside the client’s organization, is a:

• Question 14

5 out of 5 points

Audit evidence has two primary qualities for the auditor; relevance and reliability. Given the choices below, which provides the auditor with the most reliable audit evidence?

• Question 15

5 out of 5 points

When practical and reasonable, U.S. auditing standards require the confirmation of:

• Question 16

5 out of 5 points

The auditor must gather sufficient and appropriate evidence during the course of the audit. Sufficient evidence must:

• Question 17

5 out of 5 points

Which of the following statements regarding the relevance of evidence is correct?

.

• Question 18

5 out of 5 points

Which of the following generally provides the most reliable evidence?

• Question 19

5 out of 5 points

When the auditor develops supporting evidence for amounts posted to account balances with documentary evidence, that process is called:

• Question 20

5 out of 5 points

The preliminary audit strategy:

• Question 21

5 out of 5 points

The two major factors affecting acceptable audit risk are:

• Question 22

5 out of 5 points

Business risk:

• Question 23

5 out of 5 points

Written communication that the auditor will provide reasonable assurance for the detection of fraud is found in:

• Question 24

5 out of 5 points

Which of the following normally signs the engagement letter for an audit of a private company?

• Question 25

5 out of 5 points

If an auditor is requested to perform nonaudit services for a public company audit client, who is responsible for agreeing to those services with the audit firm?

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