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Here is the MCQs guide for the topic of Auditing. you will find various types of questions along with there answers in this
Q. Which of the following is normally the most reliable source of audit evidence?
A.
Internal audit
B.
Suppliers’ statements
C.
Board minutes
D.
Analytical review


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Q. According to ISA 500, the strength of audit evidence is determined by which two qualities?
A.
Appropriateness & competence
B.
Sufficiency & appropriateness
C.
Reliability & extensiveness
D.
Objectivity & independence


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Q. Which of the following are you unlikely to see in the current file of auditors’ working papers?
A.
Memorandum & articles of association
B.
Audit planning memorandum
C.
Summary of unadjusted errors
D.
Details of the work done on the inventory count


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Q. Which of the following is NOT an accepted method of selection in sampling?
A.
Systematic selection
B.
Pervasive selection
C.
Random selection
D.
Haphazard selection


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Q. Which of the following describes sampling risk?
A.
The risk of the auditor carrying out a test the wrong way round
B.
The risk of reliance on unsuitable audit evidence
C.
The risk that the sample does not reflect the population
D.
The risk of the auditor reaching the wrong conclusions from testing


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Q. At the planning stage you would NOT consider____________?
A.
the timing of the audit
B.
whether corrections from the inventory count have been implemented
C.
last year’s audit
D.
the potential use of internal audit


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Q. Which of the following should NOT be considered at the planning stage?
A.
The timing of the audit
B.
Analytical review
C.
Last year’s written representation letter
D.
Obtaining written representations


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Q. Audit risk is composed of 3 factors. Which of the following is NOT one of those factors?
A.
Compliance risk
B.
Detection risk
C.
Control risk
D.
Inherent risk


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Q. Which one of the following is NOT considered to be part of planning?
A.
Background i.e. industry
B.
Previous year’s audit i.e. any qualifications in the report
C.
Considering the work to be done by the client staff e.g. internal audit
D.
Considering whether the financial statements show a true and fair view


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Q. How long is the auditor’s term of office?
A.
Until the audit is complete
B.
Until the financial statements are complete
C.
Until the next AGM (Annual General Meeting)
D.
Until the directors remove them


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