Accounting mcqs

Disclaimer of opinion

Qualified opinion

Unqualified opinion

Adverse opinion

unqualified opinion with reference to notes to the accounts

disclaimer of opinion

unqualified opinion

qualified opinion

It is expensive

It is conducted at regular interval

It is needed when the organization has a good internal control system

It may be carried out on daily basis

Materiality judgments involve both quantitative and qualitative judgments

Materiality is a relative concept

Auditor’s consideration of materiality is influenced by the auditor’s perception of the needs of an informed decision maker who will rely on the financial statements

At the planning state, the auditor considers materiality at the financial statement level only

The auditor’s remuneration

Prior year’s errors

Adjusted interim financial statements

Prior year’s financial statements

Verification

Auditing

Checking

Vouching

Higher, Lower, Lower

Lower, Higher, Higher

Lower, Higher, Lower

Lower, Lower, Higher

Lower, Higher, Higher

Higher, Lower, Lower

Lower, Higher, Lower

B. Lower, Lower, Higher

Obtain a copy of the existing auditor’s letter of engagement

Obtain a copy of the company’s most recent board minutes

Obtain the client’s permission to communicate with the existing auditor

Obtain the existing auditor’s working papers

Retained in auditor’s office until a change in auditors

Owned by the auditor

Evidence for audit conclusions

Owned by the client

Over Valuation of assets

Curtailment of expenses

Checking of Wastages

Under valuation of assets

Only (and (C.

Relative of a director

Erstwhile director

Internal auditor

Members of the company

The Central Government

All of the above

Directors of the company

Preparation of accounting records

Taking management decisions

Preparing tax computations

Advising on weaknesses in the internal control systems

Providing representations to management

Obtaining and evaluating audit evidence on the financial statements

Calculating the year-end accruals figure for inclusion in the accounts

Conducting the inventory count

Qualified opinion

All of above 

Unqualified opinion

Adverse opinion

Other companies in the same industry

Budget

Previous years

Other audit clients

Shareholders receive a copy of all material written representations

They should be used only when there is other substantive audit evidence to complement it

They should be used only when there is a lack of other substantive audit evidence

They are the best source of audit evidence

These are given to adhere to requirements of section 211.

All of the above

These are given by the directors of the company

These are given by auditors of the company in auditor’s report

Standards on Assurance Engagement

Standards on Review Engagement

Standard on Quality Control

Standards on Auditing

All of them are analytical procedure

Comparing the actual costs with standard costs

Tracing of purchases recurred in the purchase book to purchase invoices.

Comparing aggregate wages paid to number of employees

Involvement of any specialist

Basis of the opinion

Statement of responsibilities of directors and auditors

Introductory paragraph specifying the pages to which the report relates and the accounting convention adopted

Salesmen’s summary

Bank statement

Monthly statements sent to customers

Daily cash sales summary

1, 3 and 4 only

1, 2 and 3 only

2, 3 and 4 only

1, 2 and 4 only