Deck 1: Assurance and Auditing: Integral to the Economy

Question 1

The Australian Financial Reporting Council (FRC) is responsible for providing broad oversight of the process for setting accounting and auditing standards.

Answer 1

True

Question 2

The Australian Auditing Standards Board (AUASB) is made up of members appointed by the Financial Reporting Council (FRC) and a Treasury appointed Chairman.

Answer 2

True

Question 3

The International Auditing and Assurance Standards Board (IAASB) is interested in harmonising auditing standards around the world and is working closely with US standard setters on selected standards.

Answer 3

True

Question 4

The Australian Auditing Standards Board provides the criteria against which the auditor measures the fairness of financial statement presentation for both public and private companies.

Question 5

Registration for company auditors is the responsibility of the Australian Securities and Investments Commission (ASIC).

Question 6

The internal audit profession adheres exclusively to standards set by the Auditing and Assurance Standards Board (AUASB).

Question 7

Governmental audit standards are developed by the Auditing and Assurance Standards Board (AUASB).

Question 8

The Auditing and Assurance Standards Board (AUASB) sets auditing standards for non-publicly traded companies.

Question 9

The Australian Accounting Standards Board (AASB) has the authority to establish generally accepted accounting principles for reporting entities.

Question 10

The Auditing and Assurance Standards Board (AUASB) has authority to establish generally accepted accounting principles (GAAP) for all business enterprises.

Question 11

The Auditing and Assurance Standards Board (AUASB) was established by the professional bodies in response to the Corporations Act 2001.

Question 12

A service that does not always require that a report is provided to a third party is:

A) assurance
B) attestation
C) audit
D) all of these choices

Question 13

Public accounting firms performing financial report audits for companies must:

A) register with the Auditing and Assurance Standards Board (AUASB)
B) register with the Institute of Internal Auditors
C) register with the Australian Securities Exchange (ASX)
D) have a registered company auditor sign the audit report

Question 14

Which one of the following is not a provider of assurance services?

A) operational auditors
B) internal auditors
C) governmental auditors
D) management accountants

Question 15

The Australian Auditing and Assurance Standards Board (AUASB) remains a valuable organisation because of its continuing involvement in:

A) the audit standard setting process
B) regulation and enforcement of the audit profession
C) education and administration of the professional accounting body exam
D) promulgation of accounting standards

Question 16

The primary governing board that performs quality reviews on registered auditors is the:

A) The Australian Securities and Investments Commission (ASIC) on behalf of the Financial Reporting Council (FRC)
B) Public Sector Services Board
C) Auditing and Assurance Standards Board (AUASB)
D) Australian Securities Exchange (ASX)

Question 17

Auditors of companies are licensed by the:

A) Financial Reporting Council (FRC)
B) Accounting Professional and Ethical Standards Board (APESB)
C) Australian Securities and Investments Commission (ASIC)
D) Auditing and Assurance Standards Board (AUASB)

Question 18

The Certified Internal Auditor program is administered by the:

A) Australian Securities and Investments Commission (ASIC)
B) Institute of Internal Auditors (IIA)
C) Australian Securities Exchange (ASX)
D) Accounting Professional and Ethical Standards Board (APESB)

Question 19

The body that sets the strategic direction for the Auditing and Assurance Standards Board is:

A) Australian Prudential Regulation Authority (APRA)
B) Financial Reporting Council (FRC)
C) Accounting Professional and Ethical Standards Board (APESB)
D) Australian Securities Exchange (ASX)

Question 20

The organisation that issued the Internal Control, Integrated Framework which serves as the primary criterion for evaluating the quality of a company's internal control system is:

A) Accounting Professional and Ethical Standards Board (APESB)
B) Committee of Sponsoring Organizations (COSO)
C) Financial Reporting Council (FRC)
D) Australian Securities Exchange (ASX)

Question 21

Which type of auditor may not perform a financial statement audit?

A) external auditor
B) internal auditor
C) governmental auditor
D) none of these choices
E) all of these choices

Question 22

Which type of auditor would typically perform an operational audit?

A) external auditor
B) internal auditor
C) none of these choices
D) all of these choices

Question 23

What is the criteria used in an operational audit?

A) generally accepted accounting principles (GAAP)
B) effectiveness and efficiency
C) rules and regulations
D) company policies

Question 24

Which of the following assurance services would be provided by the internal auditor?

A) the quality of an organisation's governance processes
B) effectiveness and efficiency
C) company rules and regulations
D) all of these choices

Question 25

Regulatory and professional bodies
Write the full name of the following regulatory and professional acronyms and describe the function of each entity:
FRC
AUASB
ASIC
ASX
IIA