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Test Bank for -Principles of Auditing and Other Assurance Services 22nd Edition by Ray Whittington, Kurt Pany,newest version 2024|25 A+ $20.99   Add to cart
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Test Bank for -Principles of Auditing and Other Assurance Services 22nd Edition by Ray Whittington, Kurt Pany,newest version 2024|25 A+
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Test Bank for -Principles of Auditing and Other Assurance Services 22nd Edition by Ray Whittington, Kurt Pany,newest version 2024|25 A+Test Bank for -Principles of Auditing and Other Assurance Services 22nd Edition by Ray Whittington, Kurt Pany,newest version 2024|25 A+Test Bank for -Principles of ...

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  • September 20, 2024
  • 516
  • 2024/2025
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Test Bank for Principles of Auditing and Other Assurance Services
22nd Edition by Ray Whittington, Kurt Pany 2024|25 A+




A+ Page 1
#

,Answers are at the end of each chapter Chapter 1
# # # # # # # # #




Student name: #




1) Accountants are regulated by a variety of organizations. Match the statements with the
# # # # # # # # # # # #




# most directly related organization:
# # #




● Accounting and Review Services Committee. # # # #




● American Institute of Certified Public Accountants. # # # # #




● Auditing Standards Board. # #




● Federal Accounting Standards Advisory Board.
# # # #




● Financial Accounting Standards Board. # # #




● General Accounting Office. # #




● Government Accounting Standards Board. # # #




● Public Company Accounting Oversight Board.
# # # #




● Securities and Exchange Commission. # # #




● State Boards of Accountancy.
# # #




Organizations may be used once, more than once, or not at all.
# # # # # # # # # # #




Statements Organizations
A. Develops accounting standards
# # #




for public and nonpublic companies.
# # # #




B. Develops accounting standards for the U.S. Government.
# # # # # # #




C. Improves standards of financial accounting for state and local
# # # # # # # # #




government entities. #




D. Issues auditing standards for public companies.
# # # # # #




E. Issues CPA certificates.
# # #




F. Prepares the CPA exam.
# # # #




Organizations: American Institute of Certified Public Accountants, Federal Accounting Standards
# # # # # # # # #




# Advisory Board, Financial Accounting Standards Board, Government Accounting Standards
# # # # # # # #




# Board, Public Company Accounting Oversight Board, State Boards of Accountancy.
# # # # # # # # #



#




2) The Sarbanes-Oxley Act of 2002 made significant reforms for public companies and their
# # # # # # # # # # # #




# auditors.

A+ Page 2
#

,a. Describe the events that led up to the passage of the Act.
# # # # # # # # # # #




b. Describe the major changes made by the Act. # # # # # # #




3) Many people confuse the responsibilities of the independent auditors and the client's
# # # # # # # # # # #




# management with respect to audited financial statements.
# # # # # #




a. Describe management's responsibility regarding audited financial statements.
# # # # # #




b. Describe the independent auditors' responsibility regarding audited financial statements.
# # # # # # # #




c. Evaluate the following statement: "If the auditors disagree with management regarding an
# # # # # # # # # # #




# accounting principle used in the financial statements, the auditors should express their views in the
# # # # # # # # # # # # # #




# notes to the financial statements."
# # # #




4) An investor is considering investing in one of two companies. The companies have very
# # # # # # # # # # # # #




# similar reported financial position and results of operations. However, only one of the companies
# # # # # # # # # # # # #




# has its financial statements audited.
# # # #




a. Describe what creates the demand for an audit in this situation. Include a discussion of how
# # # # # # # # # # # # # # #




# audited financial statements facilitate this investment transaction, and the effect of the audit on
# # # # # # # # # # # # #




# business risk and information risk.
# # # #




b. Identify the potential consequences to the company of not having its financial statements
# # # # # # # # # # # #




# audited.


5) A summary of findings rather than assurance is most likely to be included in a(n):
# # # # # # # # # # # # # #




A) Agreed-upon procedures report. # #




B) Compilation report. #




C) Audit report. #




D) Review report. #



#



6) The Statements on Auditing Standards have been issued by the:
# # # # # # # # #




A+ Page 3 #

, A) Auditing Standards Board. # #




B) Financial Accounting Standards Board.
# # #




C) Securities and Exchange Commission. # # #




D) Federal Bureau of Investigation.
# # #




7) The risk that a company’s financial statements will materially depart from generally
# # # # # # # # # # #




# accepted accounting principles is referred to as:
# # # # # #




A) Business Risk. #




B) Information Risk. #




C) Detection Risk. #




D) Document Risk. #




8) Historically, which of the following has the AICPA been most concerned with providing?
# # # # # # # # # # # #




A) Auditing standards. #




B) Professional guidance for regulating financial markets.
# # # # #




C) Internal auditing standards.
# #




D) Staff support to Congress.
# # #




9) The organization charged with protecting investors and the public by requiring full
# # # # # # # # # # #




# disclosure of financial information by companies offering securities to the public is the:
# # # # # # # # # # # #




A+ Page 4
#

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