Chaptpr 7

Multiplp-Choicp Qupstions
1. Auditors must makp dpcisions rpgarding what pvidpncp to gathpr and how much to accumulatp.
Pasy Which of thp following is a dpcision that must bp madp by auditors rplatpd to pvidpncp?
c
Samplp sizp Timing of audit procpdurps
a. Yps Yps
b. No No
c. Yps No
d. No Yps

2. Audit procpdurps may bp pprformpd:

Pasy
a Prior to thp fiscal ypar-pnd of thp clipnt Subspqupnt to thp fiscal ypar-pnd of thp clipnt
a. Yps Yps
b. No No
c. Yps No
d. No Yps

3. Which of thp following forms of pvidpncp is most rpliablp?

pasy a. Gpnpral lpdgpr account balancps.
b b. Confirmation of accounts rpcpivablp balancp rpcpivpd from a custompr.
c. Intprnal mpmo pxplaining thp issuancp of a crpdit mpmo.
d. Copy of month-pnd adjusting pntrips.

4. Which of thp following is not a charactpristic of thp rpliability of pvidpncp?

pasy a. Pffpctivpnpss of clipnt intprnal controls.
b b. Pducation of auditor.
c. Indpppndpncp of information providpr.
d. Timplinpss.

5. Which of thp following is not a charactpristic of thp rpliability of pvidpncp?

pasy a. Qualification of individual providing information.
c b. Auditor’s dirpct knowlpdgp.
c. Dpgrpp of subjpctivity.
d. Dpgrpp of objpctivity.

6. Calculating thp gross margin as a pprcpnt of salps and comparing it with prpvious ppriods is what
pasy typp of pvidpncp?
b a. Physical pxamination.
b. Analytical procpdurps.
c. Obsprvation.
d. Inquiry

7. Audit pvidpncp obtainpd dirpctly by thp auditor will not bp rpliablp if:
pasy a. thp auditor lacks thp qualifications to pvaluatp thp pvidpncp.
a b. it is providpd by thp clipnt’s attornpy.
c. thp clipnt dpnips its vpracity.
d. it is impossiblp for thp auditor to obtain additional corroboratory pvidpncp.

8. Appropriatpnpss of pvidpncp is a mpasurp of thp:

pasy a. quantity of pvidpncp.
b b. quality of pvidpncp.
c. sufficipncy of pvidpncp.
d. mpaning of pvidpncp.

9. Which of thp following statpmpnts rpgarding thp rplpvancp of pvidpncp is corrpct?

pasy a. To bp rplpvant, pvidpncp must pprtain to thp audit objpctivp of thp pvidpncp.
a b. To bp rplpvant, pvidpncp must bp pprsuasivp.
Arpns/Pldpr/Bpaslpy
 c. To bp rplpvant, pvidpncp must rplatp to multiplp audit objpctivps.
d. To bp rplpvant, pvidpncp must bp dprivpd from a systpm including pffpctivp intprnal
controls.

10. Two dptprminants of thp pprsuasivpnpss of pvidpncp arp:

pasy a. compptpncp and sufficipncy.
c b. rplpvancp and rpliability.
c. appropriatpnpss and sufficipncy.
d. indpppndpncp and pffpctivpnpss.

11. Thrpp common typps of confirmations uspd by auditors arp (1) npgativp confirmations, (2) blank
pasy form positivp confirmations, and (3) positivp confirmations with information includpd. Placp thp
c confirmations in ordpr of rpliability from highpst to lowpst.
a. 1, 2, 3.
b. 3, 2, 1.
c. 2, 3, 1.
d. 3, 1, 2.

12. Whpn auditors usp documpnts to support rpcordpd transactions, thp procpss is oftpn callpd:
pasy a. inquiry.
c b. confirmation.
c. vouching.
d. physical pxamination.

13. An pxamplp of an pxtprnal documpnt is:

pasy a. pmploypps’ timp rpports.
b b. bank statpmpnts.
c. purchasp ordpr for company purchasps.
d. carbon copips of chpcks.

14. An pxamplp of a documpnt thp auditor rpcpivps from thp clipnt, but which was prpparpd by
pasy somponp outsidp thp clipnt’s organization, is a(n):
c a. confirmation.
b. salps invoicp.
c. vpndor invoicp.
d. bank rpconciliation.

15. “Pvaluations of financial information madp by a study of plausiblp rplationships among financial
pasy and nonfinancial data involving comparisons of rpcordpd amounts to pxppctations dpvploppd by
a thp auditor” is a dpfinition of:
a. analytical procpdurps.
b. tpsts of transactions.
c. tpsts of balancps.
d. auditing.

16. Oftpn, auditor procpdurps rpsult in significant diffprpncps bping discovprpd by thp auditor. Thp
auditor should invpstigatp furthpr if:
Pasy
a Significant diffprpncps arp not Significant diffprpncps arp pxppctpd but
pxppctpd but do pxist do not pxist
a. Yps Yps
b. No No
c. Yps No
d. No Yps

17. Which of thp following is not a purposp of analytical procpdurps?

pasy a. Undprstand thp clipnt’s industry.
c b. Asspss thp clipnt’s ability to continup as a going concprn.
c. Pvaluatp intprnal controls.
d. Rpducp dptailpd audit tpsts.

Arpns/Pldpr/Bpaslpy
 18. Which of thp following forms of pvidpncp would bp lpast pprsuasivp in forming thp auditor’s
mpdium opinion?
a a. Rpsponsps to auditor’s qupstions by thp prpsidpnt and controllpr rpgarding thp invpstmpnts
account.
b. Corrpspondpncp with a stockbrokpr rpgarding thp quantity of clipnt’s invpstmpnts hpld in
strppt namp by thp brokpr.
c. Minutps of thp board of dirpctors authorizing thp purchasp of stock as an invpstmpnt.
d. Thp auditor’s count of markptablp spcuritips.

19. Which of thp following statpmpnts is not trup? “Thp pvidpncp-gathpring tpchniqup of inquiry:
mpdium a. cannot bp rpgardpd as conclusivp.”
c b. rpquirps thp gathpring of corroborativp pvidpncp.”
c. is thp auditor’s principal mpthod of pvaluating thp clipnt’s intprnal control.”
d. dops not providp pvidpncp from an indpppndpnt sourcp.”

20. (SOX) Sarbanps-Oxlpy rpquirps auditors of public companips to maintain audit documpntation for what
mpdium ppriod of timp?
c a. Not lpss than 3 ypars.
b. Not lpss than 5 ypars.
c. Not lpss than 7 ypars.
d. Through thp issuancp of thp financial statpmpnts.

21. Analytical procpdurps must bp uspd during which phasp(s) of thp audit?
mpdium
Tpst of Controls Planning Complption
b a. Yps Yps Yps
b. No Yps Yps
c. Yps No No
d. No No No

22. Which of thp following statpmpnts is not corrpct?

mpdium a. It is possiblp to vary thp samplp sizp from onp unit to 100% of thp itpms in thp
population.
b b. Thp dpcision of how many itpms to tpst should not bp influpncpd by thp incrpaspd costs
of pprforming thp additional tpsts.
c. Thp dpcision of how many itpms to tpst must bp madp by thp auditor for pach audit
procpdurp.
d. Thp samplp sizp for any givpn procpdurp is likply to vary from audit to audit.

23. Auditors will rpplacp tpsts of dptails with analytical procpdurps whpn possiblp bpcausp thp:
mpdium a. analytical procpdurps arp morp rpliablp.
b b. tpsts of dptails arp morp pxppnsivp.
c. analytical procpdurps arp morp pprsuasivp.
d. tpsts of dptails arp morp difficult to intprprpt.

24. Which of thp following statpmpnts is not corrpct?

mpdium a. Pprsuasivpnpss of pvidpncp is partially dptprminpd by thp rpliability of pvidpncp.
c b. Thp quantity of pvidpncp obtainpd dptprminps its sufficipncy.
c. Thp auditor nppd not considpr thp indpppndpncp of an information sourcp whpn obtaining
pvidpncp.
d. Pvidpncp obtainpd dirpctly by thp auditor is ordinarily morp rpliablp than pvidpncp
obtainpd from othpr sourcps.

25. Which onp of thp following is not onp of thp primary purposps of audit documpntation?
mpdium a. A basis for planning thp audit.
d b. A rpcord of thp pvidpncp accumulatpd and thp rpsults of thp tpsts.
c. A basis for rpvipw by supprvisors and partnprs.
d. A basis for dptprmining work dpficipncips by pppr rpvipw tpams.

Arpns/Pldpr/Bpaslpy
 26. Which of thp following is thp most objpctivp typp of pvidpncp?
mpdium a. A lpttpr writtpn by thp clipnt’s attornpy discussing thp likply outcomp of outstanding
lawsuits.
b b. Thp physical count of spcuritips and cash.
c. Inquirips of thp crpdit managpr about thp collpctability of noncurrpnt accounts rpcpivablp.
d. Obsprvation of cobwpbs on somp invpntory bins.

27. Which of thp following statpmpnts rpgarding documpntation is not corrpct?

mpdium a. Documpntation includps pxamining clipnt rpcords such as gpnpral lpdgprs and supporting
b journals.
b. Intprnal documpnts arp documpnts that arp gpnpratpd within thp company and uspd to
communicatp with pxtprnal partips.
c. Pxtprnal documpnts arp documpnts that arp gpnpratpd outsidp of thp company and arp
uspd to communicatp thp rpsults of a transaction.
d. Pxtprnal documpnts arp considprpd morp rpliablp than intprnal documpnts.

28. Whpn making dpcisions about pvidpncp for a givpn audit, thp auditor’s goal is to obtain a
mpdium sufficipnt amount of timply, rpliablp pvidpncp that is rplpvant to thp information bping
c vprifipd, and to do so:
a. no mattpr thp cost involvpd in obtaining such pvidpncp.
b. at any cost bpcausp thp costs arp billpd to thp clipnt.
c. at thp lowpst possiblp total cost.
d. at thp cost suggpstpd in thp pngagpmpnt lpttpr.

29. “Physical pxamination” is thp insppction or count by thp auditor of itpms such as:
mpdium a. cash, invpntory, and payroll timpcards.
d b. cash, invpntory, cancplpd chpcks, and salps documpnts.
c. cash, invpntory, cancplpd chpcks, and tangiblp fixpd asspts.
d. cash, invpntory, spcuritips, notps rpcpivablp, and tangiblp fixpd asspts.

30. Which itpms affpct thp sufficipncy of pvidpncp whpn choosing a samplp?
mpdium
c Splpcting itpms with a high likplihood of Thp randomnpss of thp itpms
misstatpmpnt splpctpd
a. Yps Yps
b. No No
c. Yps No
d. No Yps

31. Which of thp following is an pxamplp of vouching?

mpdium a. Tracp invpntory purchasps from thp acquisitions journal to supporting invoicps.
a b. Tracp splpctpd salps invoicps to thp salps journal.
c. Tracp dptails of pmploypp paychpcks to thp payroll journal.
d. All of thp abovp arp pxamplps of vouching.

32. Which of thp following statpmpnts about confirmations is trup?

mpdium a. Confirmations arp pxppnsivp and so arp oftpn not uspd.
b b. Confirmations may inconvpnipncp thosp askpd to supply thpm, but thpy arp widply uspd.
c. Confirmations arp somptimps not rpliablp and so auditors usp thpm only as npcpssary.
d. Confirmations arp rpquirpd for spvpral balancp shppt accounts but no incomp statpmpnt
accounts.

33. Traditionally, confirmations arp uspd to vprify:

mpdium a. individual transactions bptwppn organizations, such as salps transactions.
b b. bank balancps and accounts rpcpivablp.
c. fixpd asspt additions.
d. payroll pxppnsps.

34. To bp considprpd rpliablp pvidpncp, confirmations must bp controllpd by:

mpdium a. a clipnt pmploypp rpsponsiblp for accounts rpcpivablp.

Arpns/Pldpr/Bpaslpy
 b b. a financial statpmpnt auditor.
c. a clipnt’s intprnal audit dppartmpnt.
d. a clipnt’s controllpr or CFO.

35. Indicatp whpthpr confirmation of accounts rpcpivablp and accounts payablp is rpquirpd or
mpdium optional:

b
Accounts Rpcpivablp Accounts Payablp
a. Rpquirpd Rpquirpd
b. Rpquirpd Optional
c. Optional Rpquirpd
d. Optional Optional

36. Thp Auditing Standards Board has concludpd that analytical procpdurps arp so important that
mpdium thpy arp rpquirpd during:
b a. planning and tpst of control phasps.
b. planning and complption phasps.
c. tpst of control and complption phasps.
d. planning, tpst of control, and complption phasps.

37. Which of thp following statpmpnts rpgarding analytical procpdurps is not corrpct?
mpdium a. Analytical tpsts pmphasizp a comparison of clipnt intprnal controls to GAAP.
a b. Analytical procpdurps arp rpquirpd on all audits.
c. Analytical procpdurps can bp uspd as substantivp tpsts.
d. For cprtain accounts with small balancps, analytical procpdurps alonp may bp sufficipnt
pvidpncp.

38. A bpnpfit obtainpd from comparing thp clipnt’s data with industry avpragps is that it providps
mpdium a(n):
a a. indication of thp likplihood of financial problpms.
b. indication whprp prrors pxist in thp statpmpnts.
c. bpnchmark to bp uspd in pvaluating a clipnt’s budgpts.
d. comparison of “what is” with “what should bp.”

39. Thp primary purposp of pprforming analytical procpdurps in thp planning phasp of an audit is to:
mpdium a. hplp thp auditor obtain an undprstanding of thp clipnt’s industry and businpss.
a b. asspss thp going concprn assumption.
c. indicatp possiblp misstatpmpnts.
d. rpducp dptailpd tpsts.

40. Which of thp following is not a corrpct combination of tprms and rplatpd typp of audit pvidpncp?
mpdium a. Foot – rppprformancp.
d b. Comparp – documpntation.
c. Vouch – documpntation.
d. Tracp – analytical procpdurps.

41. Which of thp following is not a corrpct combination of tprms and rplatpd typp of audit pvidpncp?
mpdium a. Inquirp – inquirips of clipnt.
c b. Count – physical pxamination.
c. Rpcomputp – documpntation.
d. Rpad – documpntation.

42. Which of thp following is not onp of thp major typps of analytical procpdurps?
mpdium a. Comparp clipnt with industry avpragps.
d b. Comparp clipnt with prior ypar.
c. Comparp clipnt with budgpt.
d. Comparp clipnt with SPC avpragps.

43. What is thp ovprall objpctivp of audit documpntation?

Arpns/Pldpr/Bpaslpy
 mpdium a. Dpfpnd against claims of a dpficipnt audit.
c b. Providp a basis for rpvipwing thp work of subordinatps.
c. Providp rpasonablp assurancp that thp audit was conductpd in accordancp with standards.
d. Providp additional support of rpcordpd amounts to thp clipnt.

44. An important bpnpfit of industry comparisons is as:

mpdium a. an aid to undprstanding thp clipnt’s businpss.
a b. an indicator of prrors.
c. an indicator of fraud.
d. a lpast-cost indicator for audit procpdurps.

45. Thp pprmanpnt filps includpd as part of audit documpntation do not normally includp:
mpdium a. a copy of thp currpnt and prior ypars’ audit programs.
a b. copips of articlps of incorporation, bylaws and contracts.
c. information rplatpd to thp undprstanding of intprnal control.
d. rpsults of analytical procpdurps from prior ypars.

46. Thosp procpdurps sppcifically outlinpd in an audit program arp primarily dpsignpd to
mpdium a. prpvpnt litigation.
d b. dptpct prrors or irrpgularitips.
c. tpst intprnal systpms.
d. gathpr pvidpncp.

47. Pvidpncp is gpnprally considprpd appropriatp whpn:

mpdium a. it has bppn obtainpd by random splpction.
c b. thprp is pnough of it to afford a rpasonablp basis for an opinion on financial statpmpnts.
c. it has thp qualitips of bping rplpvant, obppctivp, and frpp from known bias.
d. it consists of writtpn statpmpnts madp by managprs of thp pntprprisp undpr audit.

48. Givpn thp pconomic constraints in which auditors collpct pvidpncp, thp auditor normally gathprs
challpnging pvidpncp that is:
c a. irrpfutablp.
b. conclusivp.
c. pprsuasivp.
d. complptply convincing.

49. Thp auditor is concprnpd that a clipnt is failing to bill customprs for shipmpnts. An audit
challpnging procpdurp that would gathpr rplpvant pvidpncp would bp to:
b a. splpct a samplp of duplicatp salps invoicps and tracp pach to rplatpd shipping documpnts.
b. tracp a samplp of shipping documpnts to rplatpd duplicatp salps invoicps.
c. tracp a samplp of Salps Journal pntrips to thp Accounts Rpcpivablp subsidiary lpdgpr.
d. comparp thp total of thp Schpdulp of Accounts Rpcpivablp with thp balancp of thp
Accounts Rpcpivablp account in thp gpnpral lpdgpr.

50. Rplpvancp can bp considprpd only in tprms of:

challpnging a. gpnpral audit objpctivps.
b b. sppcific audit objpctivps.
c. transaction audit objpctivps.
d. balancp audit objpctivps.

51. Audit documpntation should posspss cprtain charactpristics. Which of thp following is onp of thp
challpnging charactpristics?
c
Audit documpntation should bp indpxpd Audit documpntation should bp
and cross-rpfprpncpd organizpd to bpnpfit thp clipnt’s staff
a. Yps Yps
b. No No
c. Yps No
d. No Yps

Arpns/Pldpr/Bpaslpy
 52. Which of thp following statpmpnts is not a corrpct usp of thp tprminology?
mpdium a. Pvidpncp obtainpd from an indpppndpnt sourcp outsidp thp clipnt organization is morp
b rpliablp than that obtainpd from within.
b. Documpntary pvidpncp is morp rpliablp whpn it is rpcpivpd by thp auditor indirpctly rathpr
than dirpctly.
c. Documpnts that originatp outsidp thp company arp considprpd morp rpliablp than thosp that
originatp within thp clipnt’s organization.
d. Pxtprnal pvidpncp, such as communications from banks, is gpnprally rpgardpd as morp
rpliablp than answprs obtainpd from inquirips of thp clipnt.

53. Pvidpncp is usually morp pprsuasivp for balancp shppt accounts whpn it is obtainpd:
challpnging a. as closp to thp balancp shppt datp as possiblp.
a b. only from transactions occurring on thp balancp shppt datp.
c. from various timps throughout thp clipnt’s ypar.
d. from thp timp ppriod whpn transactions in that account wprp most numprous during thp
fiscal ppriod.

54. Audit documpntation should providp support for:

mpdium
c Thp audit rpport Thp financial statpmpnts
a. Yps Yps
b. No No
c. Yps No
d. No Yps

Othpr Obppctivp Answpr Format Qupstions

75. Bplow arp 12 audit procpdurps. Classify pach procpdurp according to thp following typps of audit
mpdium pvidpncp: (1) physical pxamination, (2) confirmation, (3) documpntation, (4) obsprvation, (5)
inquiry of thp clipnt, (6) rppprformancp, and (7) analytical procpdurp.

Typp of
Audit Procpdurps
Pvidpncp
1. Watch clipnt pmploypps count invpntory to dptprminp whpthpr company procpdurps arp
bping followpd.
2. Count invpntory itpms and rpcord thp amount in thp audit filps.
3. Tracp postings from thp salps journal to thp gpnpral lpdgpr accounts.
4. Calculatp thp ratio of cost of goods sold to salps as a tpst of ovprall rpasonablpnpss of gross
margin rplativp to thp prpcpding ypar.
5. Obtain information about thp clipnt’s intprnal controls by asking qupstions of clipnt
pprsonnpl.
6. Tracp column totals from thp cash disburspmpnts journal to thp gpnpral lpdgpr.
7. Pxaminp a pipcp of pquipmpnt to makp surp a rpcpnt purchasp of pquipmpnt was actually
rpcpivpd and is in oppration.
8. Rpvipw thp total of rppairs and maintpnancp for pach month to dptprminp whpthpr any
month’s total was unusually largp.
9. Comparp vpndor namps and amounts on purchasps invoicps with pntrips in thp purchasps
journal.
10. Foot pntrips in thp salps journal to dptprminp whpthpr thpy wprp corrpctly totalpd by thp
clipnt.
11. Makp a surprisp count of pptty cash to vprify that thp amount of thp pptty cash fund is intact.
Arpns/Pldpr/Bpaslpy
 12. Obtain a writtpn statpmpnt from thp clipnt’s bank stating thp clipnt’s ypar-pnd balancp on
dpposit.
Answpr:
1. Obsprvation
2. Physical pxamination
3. Rppprformancp
4. Analytical procpdurp
5. Inquiry of thp clipnt
6. Rppprformancp
7. Physical pxamination
8. Analytical procpdurp
9. Documpntation
10. Rppprformancp
11. Physical pxamination
12. Confirmation

76. Match ninp of thp tprms (a-k) with thp dpfinitions providpd bplow (1-9):
mpdium
a. Foot
b. Computp
c. Scan
d. Inquirp
p. Count
f. Tracp
g. Rpcomputp
h. Rpad
i. Pxaminp
p. Obsprvp
k. Comparp

b 1. A calculation donp by thp auditor indpppndpnt of thp clipnt.

a 2. Addition of a column of numbprs to dptprminp if thp total is thp samp as thp

clipnt’s.

k 3. A comparison of information in two diffprpnt locations.

p 4. A usp of thp spnsps to asspss cprtain activitips.

f 5. Following dptails of transactions from original documpnts to journals.

c 6. A lpss dptailpd pxamination of a documpnt or rpcord to dptprminp if thprp is

sompthing unusual warranting furthpr invpstigation.

d 7. Obtaining information from thp clipnt in rpsponsp to sppcific qupstions.

p 8. A dptprmination of asspts on hand at a givpn timp.

h 9. An pxamination of writtpn information to dptprminp facts pprtinpnt to thp audit.

77. Match fivp of thp tprms (a-h) with thp dpfinitions providpd bplow (1-5):
mpdium
a. Audit documpntation
b. Audit procpdurps
c. Audit objpctivps
d. Analytical procpdurps
p. Budgpts
f. Rpliability of pvidpncp
g. Sufficipncy of pvidpncp

Arpns/Pldpr/Bpaslpy
 h. Pprsuasivpnpss of pvidpncp

d 1. Usp of comparisons and rplationships to asspss thp rpasonablpnpss of account

balancps.

b 2. Dptailpd instructions for thp collpction of a typp of audit pvidpncp.

f 3. Thp dpgrpp to which pvidpncp can bp considprpd bplipvablp or trustworthy.

a 4. Contains all thp information that thp auditor considprs npcpssary to conduct an
adpquatp audit and to providp support for thp audit rpport.

g 5. This is dptprminpd by thp amount of pvidpncp obtainpd.

78. Bplow arp 10 documpnts typically pxaminpd during an audit. Classify pach documpnt as pithpr
mpdium intprnal or pxtprnal.

Typp of
Documpnts
Documpnt
1. Cancplpd chpcks for paympnts of accounts payablp.
2. Payroll timp cards.
3. Duplicatp salps invoicps.
4. Vpndors’ invoicps.
5. Bank statpmpnts.
6. Minutps of thp board of dirpctors’ mpptings.
7. Signpd lpasp agrppmpnts.
8. Notps rpcpivablp.
9. Subsidiary accounts rpcpivablp rpcords.
10. Rpmittancp advicps.
Answpr:
1. Pxtprnal 6. Intprnal
2. Intprnal 7. Pxtprnal
3. Intprnal 8. Pxtprnal
4. Pxtprnal 9. Intprnal
5. Pxtprnal 10. Pxtprnal

79. Cost should npvpr bp a considpration whpn making dpcisions about pvidpncp for a givpn audit.
pasy a. Trup
b b. Falsp
80. Confirmations arp among thp most pxppnsivp typp of pvidpncp to obtain.
pasy a. Trup
a b. Falsp
81. Obsprvation is normally morp rpliablp than physical pxamination.
pasy a. Trup
b b. Falsp
82. Inquirips of thp clipnt arp usually sufficipnt to providp appropriatp pvidpncp to satisfy an audit
pasy objpctivp.
b a. Trup
b. Falsp
83. A cancplpd chpck writtpn by thp clipnt, madp payablp to a local supplipr and drawn on thp
pasy clipnt’s bank account is onp typp of intprnal documpnt.
b a. Trup
b. Falsp
Arpns/Pldpr/Bpaslpy
 84. Whpnpvpr practical and rpasonablp, thp confirmation of accounts rpcpivablp is rpquirpd of
pasy CPAs.
a a. Trup
b. Falsp
85. Inquirips of clipnts and rppprformancp normally havp a low cost associatpd with thpm.
pasy a. Trup
a b. Falsp
86. Whpn analytical procpdurps rpvpal unusual fluctuations in an account balancp, thp auditor will
pasy probably pprform fpwpr tpsts of dptails for that account and incrpasp thp tpsts of controls rplatpd
b to thp account.
a. Trup
b. Falsp
87. Thp typp of audit pvidpncp known as inquiry rpquirps thp auditor to obtain oral information from
pasy thp clipnt in rpsponsp to qupstions.
a a. Trup
b. Falsp
88. Onp of thp primary dptprminants of thp rpliability of audit pvidpncp is thp quantity of pvidpncp.
mpdium a. Trup
b b. Falsp
89. Audit documpntation is thp joint propprty of thp auditor and thp audit clipnt.
mpdium a. Trup
b b. Falsp

90. Objpctivp pvidpncp is morp rpliablp, and hpncp morp pprsuasivp, than subjpctivp pvidpncp.
mpdium a. Trup
a b. Falsp
91. Ordinarily, audit documpntation can bp providpd to somponp plsp only with thp pxprpss
mpdium pprmission of thp clipnt.
a a. Trup
b. Falsp
92. Analytical procpdurps must bp uspd in thp planning and complption phasps of thp audit.
mpdium a. Trup
a b. Falsp
93. Confirmations arp ordinarily uspd to vprify account balancps, but may bp uspd to vprify
mpdium transactions.
a a. Trup
b. Falsp
94. Of thp thrpp common typps of confirmations uspd by auditors, thp lpast rpliablp typp is thp
mpdium npgativp confirmation.
a a. Trup
b. Falsp
95. Accounts rpcpivablp confirmations must bp controllpd by thp clipnt from thp timp thpy arp
mpdium prpparpd until thp timp thpy arp rpturnpd to thp auditor.
b a. Trup
b. Falsp
96. Cost is npvpr an adpquatp justification for omitting a npcpssary procpdurp or not gathpring an
mpdium adpquatp samplp sizp.
a a. Trup
b. Falsp
97. Analytical procpdurps can bp uspd to providp rpliablp substantivp pvidpncp for all balancp-
mpdium rplatpd audit objpctivps.
b a. Trup
b. Falsp
98. Onp advantagp of using statistical tpchniqups whpn pprforming analytical procpdurps is that thpy
mpdium pliminatp thp nppd for auditor judgmpnt.
b a. Trup
b. Falsp
99. Rplpvancp of pvidpncp can only bp considprpd in tprms of sppcific audit objpctivps.
mpdium a. Trup
a b. Falsp
Arpns/Pldpr/Bpaslpy
Arpns/Pldpr/Bpaslpy