Question 1

Which of the following would an accountant not need to know when conducting a compilation?

Accepted Answer

An accountant would need to know all of the items listed (A, B, and C) when conducting a compilation.

Question 2

When an accountant compiles a nonpublic entity's financial statements that omit substantially all disclosures required by generally accepted accounting principles,the accountant should indicate in the compilation report that the financial statements are

Accepted Answer

When financial statements omit substantially all disclosures required by GAAP, the accountant should indicate in the compilation report that the financial statements are not designed for those who are uninformed about such matters. This is because the lack of disclosures might mislead individuals who are not aware of the omitted information.

Question 3

Statements on Standards for Accounting and Review Services establish standards and procedures for which of the following engagements?

Accepted Answer

Statements on Standards for Accounting and Review Services (SSARS) are specifically designed for engagements related to the compilation or review of financial statements. Compiling an individual's personal financial statement for purposes such as obtaining a mortgage falls directly under the scope of SSARS. The other options (A, B, and C) involve activities like adjusting books of account, examining prospective financial statements, and processing financial data, which are not specifically covered by SSARS.

Question 4

In providing PrimePlus services,a CPA is likely to perform all of the following functions except:

Accepted Answer

While a CPA may monitor financial and budgetary aspects of healthcare for older individuals, they are not qualified to evaluate the quality of healthcare services provided by physicians and other medical caregivers. The other answer choices are all functions that a CPA may perform as part of PrimePlus services.

Question 5

During a review of the financial statements of a nonpublic entity,an accountant becomes aware of inadequate disclosure that is material to the financial statements.If management refuses to correct the financial statement presentations,the accountant should

Accepted Answer

The answer of During a review of the financial statements...

Question 6

In a review engagement,the accountant must make all of the following inquiries except those to:

Accepted Answer

Understanding internal controls is more relevant to an audit engagement rather than a review engagement. In a review, the accountant primarily performs analytical procedures and inquiries to management, rather than an in-depth evaluation of internal controls.

Question 7

Which of the following is not an attestation standard?

Accepted Answer

Option D is not an attestation standard. It is a requirement for obtaining a sufficient understanding of internal controls to plan and perform the engagement, but it is not a specific standard for attestation engagements. Options A, B, and C are all attestation standards that must be followed in conducting attestation engagements.

Question 8

Statements on Standards for Accounting and Review Services (SSARS)require an accountant to report when the accountant has

Accepted Answer

SSARS requires an accountant to report when they are involved in the preparation of financial statements, including when using software to generate statements in accordance with a comprehensive basis of accounting other than GAAP.

Question 9

The expectation that an internal auditor does not accept gifts that may impair judgment is based on the principle of

Accepted Answer

The principle of objectivity requires internal auditors to be impartial and unbiased in their work. Acceptance of gifts can create a conflict of interest and compromise their objectivity, hence they should not accept such gifts.

Question 10

An attestation report should state that the use of the report is restricted to specified parties under all of the following circumstances except when:

Accepted Answer

All of the listed scenarios are circumstances in which the use of the report should be restricted to specific parties, so there is not one specific exception to the rule.

Question 11

Trust Service principles cover

Accepted Answer

Trust Service principles specifically cover confidentiality, which pertains to ensuring that information is only accessible to authorized individuals. While aspects such as hardware design and physical protection are certainly important for information security, they are not explicitly covered by the Trust Service principles. Similarly, software design is not explicitly mentioned, although it does fall under some of the elements covered by the Trust Service principles, such as availability and processing integrity.

Question 12

Which of the following is not an aspect of the assurances provided by a CPA WebTrust report?

Accepted Answer

The assurances provided by a CPA WebTrust report include system availability, processing integrity, confidentiality, and privacy. Product or service quality is not specifically mentioned as an aspect of these assurances.

Question 13

Which of the following procedures is more likely to be performed in a review engagement of a nonpublic entity than in a compilation engagement?

Accepted Answer

In a review engagement, obtaining a representation letter from management is a standard procedure to confirm certain representations made during the review. This is not typically done in a compilation engagement.

Question 14

Which of the following procedures is not usually performed by the accountant during a review engagement of a nonpublic entity?

Accepted Answer

During a review engagement, the accountant primarily performs analytical procedures and inquiries rather than a detailed examination of internal controls. Communicating material weaknesses discovered during the consideration of internal control is more aligned with an audit, not a review engagement.

Question 15

IIA Standards include

Accepted Answer

IIA Standards include practice advisories and the Code of Ethics. Additionally, they include International Standards for the Professional Practice of Internal Auditing (Standards) and interpretations of those standards.

Question 16

A compilation of prospective financial statements involves all of the following except:

Accepted Answer

Analytical procedures are not typically performed in a compilation engagement, as it primarily involves assembling financial statements and issuing a report without providing assurance.

Question 17

The type of report issued under a PrimePlus assurance engagement is likely which of the following?

Accepted Answer

The answer of The type of report issued under a...

Question 18

According to the Code of Professional Conduct,what response is appropriate when an accountant,who is not independent,performs a compilation of financial statements?

Accepted Answer

According to the Code of Professional Conduct, if an accountant who is not independent performs a compilation of financial statements, the last sentence of the report should indicate that he/she is not independent. The other options are not appropriate in this situation. Withdrawing from the engagement would not be necessary if the accountant discloses the lack of independence, and expressing a disclaimer or adverse opinion would not be relevant because there is no disagreement with the information presented in the financial statements.

Question 19

Direct services offered under PrimePlus include all of the following except:

Accepted Answer

The answer of Direct services offered under PrimePlus include all...

Question 20

An accountant is required to comply with the provisions of Statements on Standards for Accounting and Review Services when I.Typing client-prepared financial statements,without modification,as an accommodation to a client.
II)Preparing standard monthly journal entries for depreciation and expiration of prepaid expenses.

Accepted Answer

The provisions of Statements on Standards for Accounting and Review Services (SSARS) apply when an accountant is engaged to prepare or review financial statements. Typing client-prepared financial statements without modification or preparing standard monthly journal entries does not constitute an engagement to prepare or review financial statements under SSARS.

Quiz 21: Assurance,Attestation,amd Internal Auditing Services-professional Judgement Module