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Match Seven of the Terms (A-P)with the Description/definitions Provided Below

Question 120

Matching

Match seven of the terms (a-p)with the description/definitions provided below (1-7):

Premises:

Responses:

A written communication from the client to the auditor formalizing statements that the client has made about matters pertinent to the audit.

Commitments

A potential legal claim against a client where the condition for a claim exists but no claim has been filed.

Completing the engagement checklist

Transactions that occurred after the balance sheet date which affect the fair presentation or disclosure of the statements being audited.

Management letter

Agreements that the entity will hold to a fixed set of conditions such as the purchase or sale of merchandise at a stated price.

Independent review

A potential future obligation to an outside party for an unknown amount resulting from activities that have already taken place.

Financial statement disclosure checklist

The use of one audit report date for normal subsequent events and a later date for one or more subsequent events.

Contingent liability

A review of the financial statements and the entire set of audit files by an independent reviewer to whom the audit team must justify the evidence accumulated and the conclusions reached.

Other information in annual reports

Subsequent events

Unasserted claim

Dual-dated audit report

Review for subsequent events

Audit documentation review

Pending claim

Inquiry of client's attorneys

Unadjusted misstatement worksheet

Letter of representation

Premises:

A written communication from the client to the auditor formalizing statements that the client has made about matters pertinent to the audit.

A potential legal claim against a client where the condition for a claim exists but no claim has been filed.

Transactions that occurred after the balance sheet date which affect the fair presentation or disclosure of the statements being audited.

Agreements that the entity will hold to a fixed set of conditions such as the purchase or sale of merchandise at a stated price.

A potential future obligation to an outside party for an unknown amount resulting from activities that have already taken place.

The use of one audit report date for normal subsequent events and a later date for one or more subsequent events.

A review of the financial statements and the entire set of audit files by an independent reviewer to whom the audit team must justify the evidence accumulated and the conclusions reached.

Responses:

Commitments

Completing the engagement checklist

Management letter

Independent review

Financial statement disclosure checklist

Contingent liability

Other information in annual reports

Subsequent events

Unasserted claim

Dual-dated audit report

Review for subsequent events

Audit documentation review

Pending claim

Inquiry of client's attorneys

Unadjusted misstatement worksheet

Letter of representation

Correct Answer:

Premises:

Responses:

Commitments

Completing the engagement checklist

Management letter

Independent review

Financial statement disclosure checklist

Contingent liability

Other information in annual reports

Subsequent events

Unasserted claim

Dual-dated audit report

Review for subsequent events

Audit documentation review

Pending claim

Inquiry of client's attorneys

Unadjusted misstatement worksheet

Letter of representation