ACCO 30073 – Auditing and Assurance in Specialized Industries

Multiple Choice Questions

Group 1

1. What is the main difference between commercial banks and universal banks in the
Philippines?
a. Commercial banks invest in non-allied enterprises, while universal banks do not.
b. Commercial banks offer all kinds of services of commercial banking, while
universal banks do not.
c. Universal banks provide all kinds of services of commercial banking and
invest in non-allied enterprises.
d. Universal banks only provide investment services, while commercial banks
provide all other types of banking services.

2. RA No. 11469 requires all lenders under BSP supervision to grant how many days of
grace period or extension for the payment of loans due within the ECQ?
a. 30 days
b. 60 days
c. 90 days
d. 180 days

3. lt refers to the economic, social, and political conditions and events in a foreign country
that may adversely affect a financial institution's operations.
a. Reputational Risk
b. Credit Risk
c. Country Risk
d. Settlement Risk

4. It is the independent central monetary authority of the Philippines that supervises and
regulates all banks and non-bank financial institutions.
a. Securities and Exchange Commission (SEC)
b. Insurance Commission (IC)
c. Bangko Sentral ng Pilipinas (BSP)
d. Bureau of Internal Revenue (BIR)

5. This refers to the act of releasing financial products or securities of organizations to the
public which can offer potential returns or financial benefits to those investors who will
purchase it.
a. Recent Archives
b. Recent Issuance
c. Digital Currency Offerings
d. Loan Securitization
6. Which of the following is not a source of funds for non-bank financial institutions in
financing their lending or investment operation?
a. Premium payments for term insurance policies
b. Regular contributions to pension funds
c. Investment into mutual funds
d. Deposit collection from customers

7. The following are types of Philippines’ bank, except one:

a. Thrift Banking
b. Incorporation Banking
c. Universal Banking
d. Rural Banking

8. Which of the following statements about the importance of auditing banking and financial
institutions are incorrect?
a. Financial institutions deal with different types of risks, including
operational, strategic, and credit risks.
b. Financial institutions must adhere to various financial reporting standards and
regulatory frameworks, such as the International Financial Reporting Standards
(IFRS), General Data Privacy Regulation (GDPR), and so on.
c. Auditing is essential for financial institutions to comply with legal and regulatory
standards.
d. Financial institutions deal with large sums of money every day and need to
ensure that their records are accurate and reliable.

9. What risk is a banking term describing the level of risk in a bank's portfolio arising from
concentration to a single counterparty, sector or country.
a. concentration risk
b. foreign risk
c. audit risk
d. country risk

10. The following are examples of banking institutions, except:

a. Thrift Banks
b. Investment banks
c. Universal and Commercial Banks
d. Rural and Cooperative Banks

11. It is a law governing the establishment, operation and regulation of Investment Houses.
a. R.A. 7653
b. P.D 1034
c. P.D 114
d. R.A 9160
12. Non-bank financial institutions are composed of the following except:
a. Financing companies
b. Investment banks
c. Mutual fund institutions
d. Cooperative banks

13. It is a statement issued by the Philippine Auditing Standards and Practices Council that
provides guidance to auditors particularly for auditing financial statements of banks in
the Philippines.
a. PAPS 1004
b. PAPS 1006
c. IAPS 1004
d. IAPS 1006

14. It is an audit trend within the banking industry that is concerned with implementing
security measures and enforcing actions to prevent the risks of data breach and theft.
a. Risk Management Framework
b. Fraud, Bribery, & Corruption
c. Business Strategy
d. Cyber-Security, Emerging Technology, & Data Theft

15. In paragraph 101 on the audits of financial statements of banks, it is stated that in
expressing an opinion on the bank’s financial statements, the auditor should adhere to
any specific formats and terms specified by the following except:
a. audit experts
b. industry practice
c. professional bodies
d. the law

16. This is all part of key audit considerations that explains why audit of banks is considered
as more difficult or different than usual, except:
a. Acceptance
b. Peculiar FS
c. Extensive Use of PFRS 9
d. Remote Auditing and Covid-19 Limitations
 17. The following are the functions of Anti-Money Laundering Council (AMLC), as defined in
RA No. 9160, except:
a. To require, receive, analyze, and investigate covered or suspicious transactions
b. To maintain price stability conducive to a balanced and sustainable growth
of the economy and employment
c. To cause the filing of complaints with the Department of Justice or the
Ombudsman for the prosecution of money laundering offenses;
d. To apply before the Court of Appeals, ex parte, for the freezing of any monetary
instrument or property alleged to be the proceeds of any unlawful activity

18. The following are examples of Thrift Banks, Except:

a. Investment Banks
b. Savings and Mortgages Banks
c. Private Development Banks
d. Microfinance Thrift Banks

19. A non-bank financial institution such as the Insurance Companies are being overseen
by?
a. Insurance Commission
b. Securities and Exchange Commission
c. Department of Trade and Industry
d. Banko Sentral ng Pilipinas

20. Which of the following is not incorrect?

a. The Bangko Sentral ng Pilipinas (BSP) is the dependent central monetary
authority of the Philippines that has regulatory and supervisory power over banks
and non-bank financial institutions
b. Non-bank financial institutions such as insurance companies are overseen by the
Securities and Exchange Commission.
c. The main services of commercial banks in the Philippines are accepting
deposits and offering checking account services.
d. Investment houses are overseen by the Insurance Commission.