Deck 1: Understanding Financial Audit and Standards for Auditors

Question 1

Financial (attest) audit is primarily concerned with expression of audit opinion on a set of financial statements.

Answer 1

False

Question 2

Financial (attest) audit includes:
i. Examination and evaluaion of financial records
ii. Audit of financial systems and transactions
iii. Audit of intenal control and internal audit functions
iv. Evaluation of Compliance with applicable statutes and regulations

A)(i) only
B)(i) & (ii) only
C)(i) to (iii) only
D)All of the above

Answer 2

All of the above

Question 3

Financial (attest) audit includes an evaluation of Compliance with applicable statutes and regulations

Answer 3

True

Question 4

Transaction audit essentially seeks to address the following issues of risks to:
i. Regularity
ii. Performance
iii. Propriety
iv. Financial Control

A)All of the above
B)(i), (ii) & (iii) only
C)(i), (iii) & (iv) only
D)(i), (ii) & (iv) only

Question 5

Transaction audit is linked to a specific assurance on an individual set of financial Statements in a particular year

Question 6

Risks of financial irregularity are always material for the purpose of qualifying audit opinion on the finanicial statements

Question 7

The following types of financial statements are audited in respect of Union, State and UT Governments
i. Finance Accounts
ii. Appropriation Accounts
iii. Balance Sheet
iv. Statements of Expenditure

A)(i) & (ii) only
B)(i) to (iii) only
C)(i) & (iii) only
D)All of the above

Question 8

Financial Audit of Government Companies is conducted by

A)Chartered Accountants appointed by the companies
B)Chartered Accountants appointed by Ministry of Company Affairs
C)Chartered Accountants appointed by C&AG
D)C&AG

Question 9

The audit of financial statements of Government Companies conducted by the C&AG is called

A)Financial Audit
B)Supplementary Audit
C)Attest Audit
D)Compliance Audit

Question 10

Financial Audit of Autonomous Bodies receiving financial assistance is governed by ______ of CAG's DPC Act 1971

A)13 & 14
B)14 & 15
C)13 & 15
D)16

Question 11

The International Standards of Auditing (ISAs) have been developed by

A)The International Federation of Accountants
B)The International Auditing Practices Committee
C)The Internationa Auditing & Accounting Standards Board
D)The INTOSAI

Question 12

The Auditing Standards of the C&AG of India comprise of
I )General Standards
Ii) Field Audit Standards
Iii) Field Standards
Iv) Reporting Standards

A)(i) to (iii) only
B)(i) & (ii) only
C)(i), (iii) & (iv) only
D)All of the above

Question 13

Which of these standards regulate the condut of the auditor

A)General Standards
B)Field Audit Standards
C)Field Standards
D)Reporting Standards

Question 14

Which of these standards regulate the audit activity of the auditor

A)General Standards
B)Field Audit Standards
C)Field Standards
D)Reporting Standards

Question 15

The Primary objective of a financial audit is to

A)Examine the accounts and records
B)Srutinize financial statements
C)Point out overstatements and understatements of account balances
D)Express an opinion on the financial statements

Question 16

The general audit objectives are also called

A)Opinions
B)Assertions
C)Criteria
D)None of these

Question 17

Which of these is the correct set of general financial audit objectives for income & expenditure account

A)Completeness, Occurrence, Measurement, Disclosure, Regularity
B)Completeness, Occurrence, Measurement, Disclosure, Existence
C)Completeness, Occurrence, Existence, Disclosure, Regularity
D)Completeness, Ownership, Measurement, Disclosure, Regularity

Question 18

Which of these is the correct set of general financial audit objectives for balance sheet

A)Completeness , Existence , Valuation , Ownership , Disclosure
B)Completeness , Existence , Measurement , Ownership , Disclosure
C)Completeness , Occurence , Valuation , Ownership , Disclosure
D)Completeness , Regularity , Valuation , Ownership , Disclosure

Question 19

The legal right to sue and recover an account receivable is the test of

A)Existence
B)Ownership
C)Completeness
D)None of these

Question 20

This financial audit objective directly tests for potential overstatement of assets and liabilities

A)Existence
B)Ownership
C)Completeness
D)None of these

Question 21

Insurance relating to the year 2013-14 was paid in 2012-13 in advance. The same was however booked as expenditure in 2012-13. This does not meet the objective of

A)Existence
B)Ownership
C)Completeness
D)Occurrence

Question 22

If some item of revenue expenditure is misclassified as capital expenditure, it can be said that this objective is not met

A)Existence
B)Disclosure
C)Completeness
D)Occurrence

Question 23

If the monthly accounts of some Treasuries or Public Works Divisions are excluded from the Accounts of a State Government, it affects this objective

A)Existence
B)Disclosure
C)Completeness
D)Occurrence

Question 24

A financial audit is intended to give

A)Qualified Assurance
B)Absolute Assurance
C)Positive Assurance
D)None of these

Question 25

Materiality is classified by

A)Context
B)Nature
C)Value
D)All of these