Test Prep CPA Test Exam Practice Questions and Answers

Question 6 of 313

In the first audit of a new client, an auditor was able to extend auditing procedures to gather sufficient evidence about consistency. Under these circumstances, the auditor should:

A.

Not report on the client's income statement.

B.

Not refer to consistency in the auditor's report.

C.

State that the consistency standard does not apply.

D.

State that the accounting principles have been applied consistently.

Question 7 of 313

The third general standard states that due care is to be exercised in the performance of an audit. This standard is ordinarily interpreted to require:

A.

Thorough review of the existing safeguards over access to assets and records.

B.

Limited review of the indications of employee fraud and illegal acts.

C.

Objective review of the adequacy of the technical training and proficiency of firm personnel.

D.

Critical review of the judgment exercised at every level of supervision.

Question 8 of 313

The concept of materiality would be LEAST important to an auditor when considering the:

A.

Adequacy of disclosure of a client's illegal act.

B.

Discovery of weaknesses in a client's internal control.

C.

Effects of a direct financial interest in the client on the CPA's independence.

D.

Decision whether to use positive or negative confirmations of accounts receivable.

Question 9 of 313

An auditor of a nonpublic company must conduct the audit in accordance with:

ASB standards.
PCAOB standards.

A.

1.

B.

Both 1 and 2.

C.

Either 1 or 2, but not both.

D.

2.

Question 10 of 313

Because of the risk of material misstatement, an audit of financial statements in accordance with generally accepted auditing standards should be planned and performed with an attitude of:

A.

Objective judgment.

B.

Independent integrity.

C.

Professional skepticism.

D.

Impartial conservatism.