Which of the following statements is not true about continuous audit?

Related Mcqs:

1. Which of the following statements is not true about continuous audit?

   A. It is conducted at regular interval
   B. It may be carried out on daily basis
   C. It is needed when the organization has a good internal control system
   D. It is expensive

2. 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

3. ______the audit risks_______the materiality and_________the audit effort.

   A. Lower, Higher, Lower
   B. Lower, Lower, Higher
   C. Higher, Lower, Lower
   D. Lower, Higher, Higher

4. For what minimum period should audit working papers be retained by audit firm?

   A. For the time period the entity remains a client of the audit firm.
   B. For a period of ten years
   C. For a period auditor opines them to be useful in servicing the client
   D. For the period the audit firm is in existence.

5. _______the audit risk,_______the materiality and _______the audit effort?

   A. Lower, Higher, Lower
   B. Lower, Lower, Higher
   C. Higher, Lower, Lower
   D. Lower, Higher, Higher

6. 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.

7. The working papers which auditor prepares for financial statements audit are___________?

   A. Evidence for audit conclusions
   B. Owned by the client
   C. Owned by the auditor
   D. Retained in auditor’s office until a change in auditors

8. 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

9. 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

10. Which of the following factors is most important in determining the appropriations of audit evidence?

    A. The reliability of audit evidence and its relevance in meeting the audit objective
    B. The objectivity and integrity of the auditor
    C. The quantity of audit evidence
    D. The independence of the source of evidence