LSU ACCT 3222 TESTS COMPILATION BUNDLE

What is the role of auditing? correct answer: To determine whether the reports prepared by the manager conform to the contract's provisions (reduces information risk) What is the main task of the auditor? correct answer: To collect sufficient appropriate evidence that management's assertions ...

any independent service that improves the quality of information (financial or non-financial) correct answer: Assurance Services What two other services fall under the umbrella of Assurance services? correct answer: 1. Attestation Services 2. Audit Services Name the 4 other services of Assu...

Assurance Services correct answer: Indepent professional services that improve the quality of information, or its context, for decision makers. Encompasses attest services and financial statement audits Attest Services correct answer: Services provided by a practitioner engaged to issue a repor...

Audit Risk correct answer: - The risk that the auditor expresses an inappropriate audit opinion when the financial statements are materially misstated. - Risk auditor will issue an unqualified opinion on materially misstated financial statements. Assertions in relation to Audit Risk correct ans...

Components of unmodified opinion for PUBLIC co: (9) correct answer: 1. Title ("registered" "independent") 2. Addressed to BOD and shareholders 3. Opinion paragraph (statements audited and opinion) 4. Audit of IC - effectiveness of ICFR 5. Basis for opinion - responsibilities and adher...

Assertion correct answer: Statement or representation, explicit or implicit, made by management regarding the recognition, measurement, presentation, and disclosure of items included in the financial statements and notes Relevant assertion correct answer: An assertion that has a reasonable poss...

Revenue Recognition correct answer: - FASB Definition: inflows or other enahancements of assets of an entity or settlements of its liabilities from delivery or producing goods, rendering services or other activities that consistute the entity's major or central operations. - FASB Statement of Fin...

What assertion is most important in auditing payables and liabilities? correct answer: completeness What assertion is tested when performing initial procedures for A/P balances? correct answer: valuation 4 initial procedures for A/P correct answer: 1. agree BB to PY 2. obtain A/P TB 3. ...

Internal Control (IC) correct answer: - Management has the responsibility to design and maintain a system of IC that provides reasonable assurance that assets and records are properly safeguarded, and that the entity's information system generates information that is reliable for decision making. ...

What assertion is of most concern when auditing payables/liabilities? correct answer: completeness what should you be aware of when auditing payables/liabilities? correct answer: beware of understatement of liabilities/expenses and unrecorded liabilities/expenses Steps to audit payables/liab...

Transactions and Events: CAPCO correct answer: Completeness, Proper period cutoff, Accuracy, Classification, Occurrence Account Balances: CARE correct answer: Completeness, Allocation and valuation, rights and obligations, Existence Presentation and Disclosure: CURV correct answer: Complete...

Auditor's Responsibilities w.r.t. Auditing Standards and Standards of Professional Conduct correct answer: - Private Entity: CPA must follow standards established by the ASB, as well as the independence and other standards of professional conduct established by the AICPA Code of Professional Condu...

Auditing Prepaid Expenses correct answer: - Examples: prepaid insurance, prepaid rent, and prepaid interest - Prepaid expense balances are generally not highly material; as a result, substantive analytical procedures are often used to verify these accounts - Inherent Risk: generally assessed as l...

an existing condition or situation involving uncertainty as to possible loss that will ultimately be resolved when one or more future events occur or fail to occur correct answer: loss contingency 3 categories of the likelihood of loss correct answer: 1. Probably 2. Reasonably possible 3. R...