Which of the following documents is not relevant for vouching cash sales?
Which of the following documents is not relevant for vouching cash sales?
Monthly statements sent to customers | |
Daily cash sales summary | |
Bank statement | |
Salesmen’s summary |
پاک اسٹڈی لائبریری اپنی خدمات کو بہتر کرنے کے لئے نئے سوفٹ وئیر انسٹال کررہی ہے ۔ اس لئے آئندہ کچھ دن آپ کو کچھ صفحات تک رسائی میں مشکلات کا سامنا ہوسکتا ہے ۔ جس کے لئے ہم معذرت خواہ ہیں۔
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Which of the following documents is not relevant for vouching cash sales?
Monthly statements sent to customers | |
Daily cash sales summary | |
Bank statement | |
Salesmen’s summary |
Which of the following are fundamental ethical principles for professional accountants? 1 Competence 2 Compliance 3 Integrity 4 Objectivity
1, 2 and 4 only | |
1, 2 and 3 only | |
2, 3 and 4 only | |
1, 3 and 4 only |
When restrictions that significantly affect the scope of the audit are imposed by the client, the auditor generally should issue which of the following
Unqualified report with ‘an emphasis of matter’ paragraph; | |
Disclaimer of opinion | |
Adverse opinion | |
Qualified opinion |
When issuing unqualified opinion, the auditor who evaluates the audit findings should be satisfied that the_____________?
Estimate of the total likely misstatement is more than materially level | |
Amount of known misstatement is documented in working papers | |
Estimates of the total likely misstatement is less than materiality level | |
Estimates of the total likely misstatement cannot be made |
When applying analytical procedures, an auditor could develop independent estimate of an account balance to compare it to___________?
Prior year audited balance adjusted for trends in the industry | |
client’s unedited account balance adjusted for trends in the industry | |
Prior year audited balance | |
client’s unedited account balance |
What sort of assurance is provided in a review engagement?
No assurance | |
Negative assurance | |
High level of assurance | |
Positive assurance |
What is the primary objective of analytical procedures used in the overall review stage of an audit?
To help to corroborate the conclusions drawn from individual components of financial statements | |
To reduce specific detection risk | |
To satisfy doubts when questions arise about a client’s ability to continue | |
To direct attention to potential risk areas |
What is meant by the expression ‘expectation gap’?
The gap between the auditors’ own perception of their duties and how they are set out in the Companies Act | |
The gap between the public perception of the role of company auditors and their statutory role and responsibilities | |
The gap between how the directors of a company perform their duties and how the general public expects them to perform | |
The gap between how the directors of a company perform their duties and how the shareholders expect them to perform |
What is meant by negative assurance?
The client’s financial statements were found to be materially misstated. | |
The auditor cannot give an opinion due to lack of evidence. | |
The auditor could not conduct any tests due to lack of controls. | |
The auditor did not find anything to indicate that a material misstatement exists. |
What are analytical procedures?
Substantive tests designed to evaluate the validity of management’s representation letter | |
Substantive tests designed to study relationships between financial and nonfinancial | |
Substantive tests designed to assess control risk | |
All of the above |
Verification refers to_________?
Examining the journal and ledger | |
Examining the physical existence and valuation of assets. | |
None of the above. | |
Examination of vouchers related to assets. |
To test whether sales have been recorded, the auditor should draw a sample from a file of__________?
sales orders | |
purchase orders | |
bill of loading | |
sales invoices |
The term of the auditor ship of first auditor would be from the date of appointment till________?
the conclusion of first annual general meeting | |
the conclusion of statutory meeting | |
the date of removal | |
the conclusion of next annual general meeting |
The date on auditor’s report should not be____________?
Both and | |
the data of AGM | |
earlier than the date on which the accounts are approved by the management | |
later than the date on which the accounts are approved in board’s meeting |
The branch auditor is appointed by___________?
Shareholders in general meeting | |
Shareholders in an annual general meeting | |
Any of the above | |
Board of directors in board meeting |
The basic assumption underlying the use of analytical procedures is:____________?
It helps the auditor to study relationship among elements of financial information | |
None of the above. | |
Analytical procedures will not be able to detect unusual relationships | |
Relationship among data exist and continue in the absence of known condition to the contrary |
The authority to remove the first auditor before the expiry of term is with__________?
the board of directors | |
the shareholders in a general meeting | |
the Central Government | |
the shareholders in the first annual General meeting |
The auditor should examine subsequent realization of revenue such as dividends, interest,commission, etc to:_____________?
identify cases of unrecorded revenue | |
recompute accrued income on the data of balance sheet | |
ensure proper disclosure in the balance sheet | |
Any of these |
The auditor has a right to___________?
Obtain information and explanation from the employees and officers | |
Obtain information and explanation necessary for the purpose of audit | |
Both and | |
Obtain information and explanation |
Test Checking refers to___________?
Checking of all transactions recorded | |
Examination of adjusting and closing entries | |
Checking of selected number of transactions | |
Testing of accounts and records |
The term ‘Audit’ is derived from a Latin word “audire” which means___________?
To inspect | |
To hear | |
To investigate | |
To examine |
Stock should be valued at_________?
Cost | |
Cost or Market price whichever is lower. | |
Market price | |
Cost less depreciation. |
Scope of financial audit is__________?
Financial information | |
Non-financial information | |
Both (a) and (b) | |
None of these |
The scope of internal audit is decided by the___________?
Law | |
Shareholders | |
Government | |
Management |
A sale of Rs. 50.000 to A was entered as a sale to B. This is an example of____________?
Error of omission | |
Error of principle | |
Error of commission | |
Compensating error |