Auditing And Assurance Services
17th Edition
ISBN: 9780134897431
Author: ARENS, Alvin A.
Publisher: PEARSON
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Question
Chapter 24, Problem 22.1MCQ
To determine
Identify the option that describes the auditor’s responsibility for the MD&A information.
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Students have asked these similar questions
An auditor issues a report dated 2/12/Year 2 on financial statements for the year ended 12/31/Year 1. Which best describes the
auditor's responsibility for an event occurring on 2/1/Year 2 and an event occurring on 3/1/Year 27
A. The auditor has an active responsibility to investigate both events.
B. The auditor has an active responsibility to investigate the 2/1/Year 2 event, but no responsibility concerning the
3/1/Year 2 event.
C. The auditor has an active responsibility to investigate the 2/1/Year 2 event, and must also consider the effect of the
3/1/Year 2 event if it comes to his/her attention.
D. The auditor has no responsibility for either event, since both occur after the date of the financial statements.
The standard unqualified opinion based on the audit of a public company's financial statements includes
a.
A discussion of Key Audit Matters if KAMs are discovered.
b.
A reference to Key Audit Matters if no KAMs are discovered.
c.
A statement that the CPA firm is registered with the AICPA.
d.
An indication of how long the firm has served as the company's auditors.
e.
A Basis for Opinion section preceding the Opinion of Financial Statements section.
Consider the following statements:
I. For an audit of a non-public company a issue involving information in the “Management
Discussion and Analysis section of the company’s annual report would be addressed in an
Other Matter paragraph.
II. The new PCAOB audit report includes a section involving Key Audit Matters.
I is true; II is true
I is true; II is false
I is false; II is true
I is false; II is false
Chapter 24 Solutions
Auditing And Assurance Services
Ch. 24 - Prob. 1RQCh. 24 - Explain why an auditor is interested in a clients...Ch. 24 - Prob. 3RQCh. 24 - Prob. 4RQCh. 24 - Prob. 5RQCh. 24 - Prob. 6RQCh. 24 - Prob. 7RQCh. 24 - Prob. 8RQCh. 24 - What major considerations should the auditor take...Ch. 24 - Identify five audit procedures normally done as a...
Ch. 24 - Prob. 11RQCh. 24 - Prob. 12RQCh. 24 - Prob. 13RQCh. 24 - Prob. 14RQCh. 24 - Prob. 15RQCh. 24 - Prob. 16RQCh. 24 - Prob. 17RQCh. 24 - Prob. 18RQCh. 24 - Prob. 19RQCh. 24 - Prob. 20.1MCQCh. 24 - Prob. 20.2MCQCh. 24 - Prob. 20.3MCQCh. 24 - Prob. 21.1MCQCh. 24 - Prob. 21.2MCQCh. 24 - Prob. 21.3MCQCh. 24 - Prob. 22.1MCQCh. 24 - Prob. 22.2MCQCh. 24 - Prob. 22.3MCQCh. 24 - Prob. 23.1MCQCh. 24 - Prob. 23.2MCQCh. 24 - Prob. 23.3MCQCh. 24 - Prob. 24DQPCh. 24 - Prob. 25DQPCh. 24 - Prob. 26DQPCh. 24 - Prob. 28DQPCh. 24 - Prob. 29DQPCh. 24 - Prob. 32DQPCh. 24 - Prob. 33DQP
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Similar questions
- Which of the following statements about the auditor's responsibilities in public company audits is true as covered by the PCAOB? A. The auditor issues an opinion on the financial statements and management issues the opinion on internal control over financial reporting. B. The auditor issues an opinion on the financial statements only if internal control over financial reporting is found to be effective. C. The auditor issues an opinion on the financial statements; if those are found to be fairly stated, the auditor proceeds to issue an opinion on internal control over financial reporting. D. The auditor issues opinions on the financial statements and internal control over financial reporting.arrow_forwardWhich of the following is NOT an implication of Section 302 of SOX?a. Auditors must determine whether changes in internal control have materially affected, or are likely to materially affect, internal control over financial reporting.b. Auditors must interview management regarding significant changes in the design or operation of internal control that occurred since the last audit.c. Corporate management (including the CEO) must certify monthly and annually their organization’s internal controls over financial reporting.d. Management must disclose any material changes in the company’s internal controls that have occurred during the most recent fiscal quarter.arrow_forwardThe audit report date on a standard unmodified opinion audit report indicates A. the last day of the fiscal period. B. the last day of the auditor's responsibility for the review of significant events that occurred after the date of the financial statements. O C. the date on which the financial statements were filed with the Securities and Exchange Commission. D. the last date on which users may institute a lawsuit against either the client or the auditor.arrow_forward
- 13. When auditing an entity's financial statements in accordance with Government Auditing Standards (the "Yellow Book"), an auditor is required to report on: I. Recommendations for actions to improve operations. II. The scope of the auditor's tests of compliance with laws and regulations. Group of answer choices I only. II only. Both I and II. Neither I nor II.arrow_forwardUnder which section in the auditor's report is stated that, "we have audited the financial statements of the company"? O a. Auditor's responsibilities for the audit of the Financial Statements paragraph O b. Opinion paragraph O c Basis for Opinion paragraph O d. Responsibilities of Management for the Financial Statements paragrapharrow_forwardWhich of the following is not correct with regard to the Public Company Accounting Oversight Board?a. The board can expel a registered auditing firm without SEC approval.b. All registered auditing firms must be inspected at least every three years.c. The board members must be appointed by Congress.d. The board has the authority to set auditing standards rather than utilize the work of the Auditing Standards Board.arrow_forward
- An auditor issues an audit report that expresses three opinions. Which of the following is not one of those opinions? Question 23 options: a) whether management’s assessment of the company’s internal control over its financial reporting is appropriate b) whether management’s assessment that the financial statements are based upon the proper use of GAAP c) whether the company maintained effective internal control over its financial reporting d) whether the company’s financial statements present fairly the results of operations and cash flows in conformity with GAAParrow_forwardWhich of the following statements, relating to the auditor's responsibilities regarding subsequent events, if any, is/are correct? (1) Auditors do not have a responsibility to perform procedures to identify subsequent events after the date of the auditor's report(2) Where a material adjusting subsequent event is identified after the financial statements are issued, but prior to approval by the shareholders, the auditor should includeja qualified opinion in their audit report if management refuses to adjust the financial statements for the event a. 1 only b. Neither 1 nor 2 c. 2 only d. Both 1 and 2arrow_forward21)An audit engagement letter A.May not be prepared each period for a recurring audit engagement B.Is prepared for the benefit of the audit, audit client and general public C.Shall include specific audit procedures to be performed by the auditor D.Is usually sent by auditor to the client upon the commencement of the audit 22)The engagement letter A.Can affect legal responsibility to the client B.Can be used to alter the auditor’s responsibilities under the standards on auditing C.Is used only if it is an engagement, but has no effect for review or compilation services D.Affects the CPA firm’s responsibility to external users of audited financial statements 23)Which of the following is notinvolved during pre-planning phase? A.Obtaining information about client’s legal obligation B.Obtaining an engagement letter C.Selecting staff for engagement D.Deciding whether to accept or continue an audit engagement 24)Which of the following matters is least likely to be discussed in an…arrow_forward
- Which required SEC filing would contain the following content? "Our auditors identified the following critical audit matter: Significant judgment may be required by the Company in determining revenue recognition for these customer agreements. a) 8-K b) Proxy c) 10-Karrow_forwardStatutory auditor, during the regular audit, from incoming company A to draft letters that will be addressed to customers with a request that customers confirm by direct letter that they will send to the auditor the information stated in the letter to the door of the customers' account. , audited company A refused to compile and send them to its clients. In this case, what type of report will the regular auditor issue for the balance sheet audit?arrow_forwardtrue or false In the auditor's responsibilities paragraph of the audit report issued for financial statements of anonpublic company, the auditor expresses an opinion about the internal controls of the company.arrow_forward
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