Window dressing implies_______________?

Related Mcqs:

1. Concurrent audit is a part of____________?

   A. Internal check system
   B. Continuous audit
   C. Internal audit system
   D. None of these

2. Errors of Omission are_____________?

   A. Technical errors
   B. Errors of principle
   C. Compensating errors
   D. None of the above

3. Test Checking refers to___________?

   A. Testing of accounts and records
   B. Checking of selected number of transactions
   C. Examination of adjusting and closing entries
   D. Checking of all transactions recorded

4. Which of the following statements is most closely associated with analytical procedure applied at substantive stage?

   A. It helps to study relationship among balance sheet accounts
   B. It helps to discover material misstatements in the financial statements
   C. It helps to identify possible oversights
   D. It helps to accumulate evidence supporting the validity of a specific account balance

5. Which of the following statements is, generally, correct about the reliability of audit evidence?

   A. To be reliable, evidence should conclusive rather than persuasive
   B. Effective internal control system provides reliable audit evidence
   C. Evidence obtained from outside sources routed through the client
   D. All are correct.

6. In an audit of financial statements, substantive tests are audit procedures that __________?

   A. May be eliminated for an account balance under certain conditions
   B. Are designed to discover significant subsequent events
   C. Will increase proportionately when the auditor decreases the assessed level of control risk
   D. May be test of transactions, test of balance and analytical procedures

7. What would most appropriately describe the risk of incorrect rejection in terms of substantive testing?

   A. The auditor concludes balance is materially correct when in actual fact it is not
   B. The auditor concludes that the balance is materially misstated when in actual fact it not
   C. The auditor has rejected an item for sample which was material
   D. None of the above

8. Which of the following affects audit effectiveness?

   A. Risk of over reliance
   B. Risk of incorrect rejection
   C. Risk of incorrect acceptance
   D. Both A and C

9. Which of the following is not an advantage of the preparation of working paper?

   A. To provide a basis for review of audit work
   B. To provide a basis for subsequent audits
   C. To ensure audit work is being carried out as per programme
   D. To provide a guide for advising another client on similar issues

10. The current file of the auditor’s working papers, generally, should include____________?

    A. A flowchart of the internal controls
    B. Organisation charts
    C. A copy of financial statements
    D. Copies of bond and debentures