Introduction to Audit and Assurance Services

Tutorial 1-Part 1- Introduction to Audit and Assurance Services

Review Questions

MCQ

1. Auditing plays a vital role in business, government and our economy. Which of the following bodies does not require an annual audit?

1. all public and large proprietary companies.
2. small proprietary companies.
3. 'not-for-profit' organizations, including educational institutions.
4. commonwealth government departments and statutory authorities

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1. What type of audit activity involves the auditor obtaining and evaluating evidence to determine whether certain financial or operating activities of an entity conform to specified conditions, rules or regulations?

1. compliance audit.
2. financial report audit.
3. performance audit.
4. comprehensive audit.

1. What type of audit activity involves obtaining and evaluating evidence about the efficiency, economy and effectiveness of an entity’s operating activities in relation to specified objectives?

1. compliance audit.
2. financial report audit.
3. performance audit.
4. all of the above.

1. Which of the following is true regarding an auditor’s responsibility for detecting fraud?

1. auditors are required to detect all fraud during an audit.
2. auditors must be reasonably cautious and careful and investigate anything suspicious.
3. auditors are not required to detect possible fraud.
4. auditors are not able to investigate fraud.

Short essay questions

1) Explain what you understand about auditing

2) List various types of auditors

3) Identify and differentiate the various types of audits.

4) Why financial statements need to be audited?

Review and scenario questions

Q1. According to ISA200, auditor could only provide reasonable assurance that the financial statements do not contain material misstatement. Why?

Q2. Compare and contrast internal auditors and external auditors in a tabular format under the headings of independence, nature of work, quality standards, legislation, and professional status.