{"id":3236,"date":"2019-03-28T03:24:16","date_gmt":"2019-03-28T03:24:16","guid":{"rendered":"https:\/\/www.dumpsbase.com\/freedumps\/?p=3236"},"modified":"2019-03-28T03:59:13","modified_gmt":"2019-03-28T03:59:13","slug":"auditing-attestation-aud-cpa-exam-questions","status":"publish","type":"post","link":"https:\/\/www.dumpsbase.com\/freedumps\/auditing-attestation-aud-cpa-exam-questions.html","title":{"rendered":"Auditing &#038; Attestation AUD CPA Exam Questions"},"content":{"rendered":"\n<p>Auditing &amp; Attestation (AUD) exam is a section of the CPA Exam, which covers the entire auditing process, including auditing procedures,  generally accepted auditing standards, standards related to attest  engagements and the AICPA Code of Professional Conduct. When you are looking for valid AUD exam questions to prepare for Auditing &amp; Attestation (AUD) exam, please choose the latest AUD exam questions online. We ensure that you can 100% pass Auditing &amp; Attestation (AUD) exam at the first attempt.<\/p>\n\n\n<p><!--EndFragment--><\/p>\n<h2>AUD CPA Exam Questions <span style=\"color: #800000;\">Free DEMO<\/span>, Read And Test<\/h2>\n\n\n<p><br><script>\n\t  window.fbAsyncInit = function() {\n\t    FB.init({\n\t      appId            : '622169541470367',\n\t      autoLogAppEvents : true,\n\t      xfbml            : true,\n\t      version          : 'v3.1'\n\t    });\n\t  };\n\t\n\t  (function(d, s, id){\n\t     var js, fjs = d.getElementsByTagName(s)[0];\n\t     if (d.getElementById(id)) {return;}\n\t     js = d.createElement(s); js.id = id;\n\t     js.src = \"https:\/\/connect.facebook.net\/en_US\/sdk.js\";\n\t     fjs.parentNode.insertBefore(js, fjs);\n\t   }(document, 'script', 'facebook-jssdk'));\n\t<\/script><script type=\"text\/javascript\" >\ndocument.addEventListener(\"DOMContentLoaded\", function(event) { \nif(!window.jQuery) alert(\"The important jQuery library is not properly loaded in your site. Your WordPress theme is probably missing the essential wp_head() call. You can switch to another theme and you will see that the plugin works fine and this notice disappears. If you are still not sure what to do you can contact us for help.\");\n});\n<\/script>  \n  \n<div  id=\"watupro_quiz\" class=\"quiz-area single-page-quiz\">\n<p id=\"submittingExam884\" style=\"display:none;text-align:center;\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/plugins\/watupro\/img\/loading.gif\" width=\"16\" height=\"16\"><\/p>\n\n<div class=\"watupro-exam-description\" id=\"description-quiz-884\"><\/div>\n\n<form action=\"\" method=\"post\" class=\"quiz-form\" id=\"quiz-884\"  enctype=\"multipart\/form-data\" >\n<div class='watu-question ' id='question-1' style=';'><div id='questionWrap-1'  class='   watupro-question-id-25222'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>1. <\/span>Several sources of GAAP consulted by an auditor are in conflict as to the application of an accounting principle. <br \/>\r<br>Which of the following should the auditor consider the most authoritative?<\/div><input type='hidden' name='question_id[]' id='qID_1' value='25222' \/><input type='hidden' id='answerType25222' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25222[]' id='answer-id-104216' class='answer   answerof-25222 ' value='104216'   \/><label for='answer-id-104216' id='answer-label-104216' class=' answer'><span>FASB Technical Bulletins.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25222[]' id='answer-id-104217' class='answer   answerof-25222 ' value='104217'   \/><label for='answer-id-104217' id='answer-label-104217' class=' answer'><span>AICPA Accounting Interpretations.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25222[]' id='answer-id-104218' class='answer   answerof-25222 ' value='104218'   \/><label for='answer-id-104218' id='answer-label-104218' class=' answer'><span>FASB Statements of Financial Accounting Concepts.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25222[]' id='answer-id-104219' class='answer   answerof-25222 ' value='104219'   \/><label for='answer-id-104219' id='answer-label-104219' class=' answer'><span>AICPA Technical Practice Aids.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-2' style=';'><div id='questionWrap-2'  class='   watupro-question-id-25223'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>2. <\/span>For an entity's financial statements to be presented fairly in conformity with generally accepted accounting principles, the principles selected should:<\/div><input type='hidden' name='question_id[]' id='qID_2' value='25223' \/><input type='hidden' id='answerType25223' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25223[]' id='answer-id-104220' class='answer   answerof-25223 ' value='104220'   \/><label for='answer-id-104220' id='answer-label-104220' class=' answer'><span>Be applied on a basis consistent with those followed in the prior year.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25223[]' id='answer-id-104221' class='answer   answerof-25223 ' value='104221'   \/><label for='answer-id-104221' id='answer-label-104221' class=' answer'><span>Be approved by the Auditing Standards Board or the appropriate industry subcommittee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25223[]' id='answer-id-104222' class='answer   answerof-25223 ' value='104222'   \/><label for='answer-id-104222' id='answer-label-104222' class=' answer'><span>Reflect transactions in a manner that presents the financial statements within a range of acceptable limits.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25223[]' id='answer-id-104223' class='answer   answerof-25223 ' value='104223'   \/><label for='answer-id-104223' id='answer-label-104223' class=' answer'><span>Match the principles used by most other entities within the entity's particular industry.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-3' style=';'><div id='questionWrap-3'  class='   watupro-question-id-25224'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>3. <\/span>Which of the following statements is correct concerning an auditor's responsibilities regarding financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_3' value='25224' \/><input type='hidden' id='answerType25224' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25224[]' id='answer-id-104224' class='answer   answerof-25224 ' value='104224'   \/><label for='answer-id-104224' id='answer-label-104224' class=' answer'><span>An auditor may not draft an entity's financial statements based on information from management's accounting system.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25224[]' id='answer-id-104225' class='answer   answerof-25224 ' value='104225'   \/><label for='answer-id-104225' id='answer-label-104225' class=' answer'><span>The adoption of sound accounting policies is an implicit part of an auditor's responsibilities.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25224[]' id='answer-id-104226' class='answer   answerof-25224 ' value='104226'   \/><label for='answer-id-104226' id='answer-label-104226' class=' answer'><span>An auditor's responsibilities for audited financial statements are confined to the expression of the auditor's opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25224[]' id='answer-id-104227' class='answer   answerof-25224 ' value='104227'   \/><label for='answer-id-104227' id='answer-label-104227' class=' answer'><span>Making suggestions that are adopted about an entity's internal control environment impairs an auditor's independence.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-4' style=';'><div id='questionWrap-4'  class='   watupro-question-id-25225'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>4. <\/span>Which of the following provides the most authoritative guidance for an auditor?<\/div><input type='hidden' name='question_id[]' id='qID_4' value='25225' \/><input type='hidden' id='answerType25225' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25225[]' id='answer-id-104228' class='answer   answerof-25225 ' value='104228'   \/><label for='answer-id-104228' id='answer-label-104228' class=' answer'><span>An AICPA audit and accounting guide that provides specific guidance with respect to the accounting practices in the client's industry.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25225[]' id='answer-id-104229' class='answer   answerof-25225 ' value='104229'   \/><label for='answer-id-104229' id='answer-label-104229' class=' answer'><span>A Journal of Accountancy article discussing implementation of a new standard.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25225[]' id='answer-id-104230' class='answer   answerof-25225 ' value='104230'   \/><label for='answer-id-104230' id='answer-label-104230' class=' answer'><span>General guidance provided by a Statement on Auditing Standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25225[]' id='answer-id-104231' class='answer   answerof-25225 ' value='104231'   \/><label for='answer-id-104231' id='answer-label-104231' class=' answer'><span>Specific guidance provided by an interpretation of a Statement on Auditing Standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-5' style=';'><div id='questionWrap-5'  class='   watupro-question-id-25226'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>5. <\/span>Which of the following accurately depicts the auditor's responsibility with respect to Statements on Auditing Standards?<\/div><input type='hidden' name='question_id[]' id='qID_5' value='25226' \/><input type='hidden' id='answerType25226' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25226[]' id='answer-id-104232' class='answer   answerof-25226 ' value='104232'   \/><label for='answer-id-104232' id='answer-label-104232' class=' answer'><span>The auditor is required to follow the guidance provided by the Standards, without exception.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25226[]' id='answer-id-104233' class='answer   answerof-25226 ' value='104233'   \/><label for='answer-id-104233' id='answer-label-104233' class=' answer'><span>The auditor is generally required to follow the guidance provided by Standards with which he or she is familiar, but will not be held responsible for departing from provisions of which he or she was unaware.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25226[]' id='answer-id-104234' class='answer   answerof-25226 ' value='104234'   \/><label for='answer-id-104234' id='answer-label-104234' class=' answer'><span>The auditor is generally required to follow the guidance provided by the Standards, unless following such guidance would result in an audit that is not cost-effective.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25226[]' id='answer-id-104235' class='answer   answerof-25226 ' value='104235'   \/><label for='answer-id-104235' id='answer-label-104235' class=' answer'><span>The auditor is generally required to follow the guidance provided by the Standards, and should be able to justify any departures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-6' style=';'><div id='questionWrap-6'  class='   watupro-question-id-25227'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>6. <\/span>In the first audit of a new client, an auditor was able to extend auditing procedures to gather sufficient evidence about consistency. Under these circumstances, the auditor should:<\/div><input type='hidden' name='question_id[]' id='qID_6' value='25227' \/><input type='hidden' id='answerType25227' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25227[]' id='answer-id-104236' class='answer   answerof-25227 ' value='104236'   \/><label for='answer-id-104236' id='answer-label-104236' class=' answer'><span>Not report on the client's income statement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25227[]' id='answer-id-104237' class='answer   answerof-25227 ' value='104237'   \/><label for='answer-id-104237' id='answer-label-104237' class=' answer'><span>Not refer to consistency in the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25227[]' id='answer-id-104238' class='answer   answerof-25227 ' value='104238'   \/><label for='answer-id-104238' id='answer-label-104238' class=' answer'><span>State that the consistency standard does not apply.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25227[]' id='answer-id-104239' class='answer   answerof-25227 ' value='104239'   \/><label for='answer-id-104239' id='answer-label-104239' class=' answer'><span>State that the accounting principles have been applied consistently.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-7' style=';'><div id='questionWrap-7'  class='   watupro-question-id-25228'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>7. <\/span>The third general standard states that due care is to be exercised in the performance of an audit. <br \/>\r<br>This standard is ordinarily interpreted to require:<\/div><input type='hidden' name='question_id[]' id='qID_7' value='25228' \/><input type='hidden' id='answerType25228' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25228[]' id='answer-id-104240' class='answer   answerof-25228 ' value='104240'   \/><label for='answer-id-104240' id='answer-label-104240' class=' answer'><span>Thorough review of the existing safeguards over access to assets and records.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25228[]' id='answer-id-104241' class='answer   answerof-25228 ' value='104241'   \/><label for='answer-id-104241' id='answer-label-104241' class=' answer'><span>Limited review of the indications of employee fraud and illegal acts.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25228[]' id='answer-id-104242' class='answer   answerof-25228 ' value='104242'   \/><label for='answer-id-104242' id='answer-label-104242' class=' answer'><span>Objective review of the adequacy of the technical training and proficiency of firm personnel.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25228[]' id='answer-id-104243' class='answer   answerof-25228 ' value='104243'   \/><label for='answer-id-104243' id='answer-label-104243' class=' answer'><span>Critical review of the judgment exercised at every level of supervision.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-8' style=';'><div id='questionWrap-8'  class='   watupro-question-id-25229'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>8. <\/span>The concept of materiality would be least important to an auditor when considering the:<\/div><input type='hidden' name='question_id[]' id='qID_8' value='25229' \/><input type='hidden' id='answerType25229' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25229[]' id='answer-id-104244' class='answer   answerof-25229 ' value='104244'   \/><label for='answer-id-104244' id='answer-label-104244' class=' answer'><span>Adequacy of disclosure of a client's illegal act.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25229[]' id='answer-id-104245' class='answer   answerof-25229 ' value='104245'   \/><label for='answer-id-104245' id='answer-label-104245' class=' answer'><span>Discovery of weaknesses in a client's internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25229[]' id='answer-id-104246' class='answer   answerof-25229 ' value='104246'   \/><label for='answer-id-104246' id='answer-label-104246' class=' answer'><span>Effects of a direct financial interest in the client on the CPA's independence.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25229[]' id='answer-id-104247' class='answer   answerof-25229 ' value='104247'   \/><label for='answer-id-104247' id='answer-label-104247' class=' answer'><span>Decision whether to use positive or negative confirmations of accounts receivable.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-9' style=';'><div id='questionWrap-9'  class='   watupro-question-id-25230'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>9. <\/span>An auditor of a nonpublic company must conduct the audit in accordance with: <br \/>\r<br>I. ASB standards. <br \/>\r<br>II. PCAOB standards.<\/div><input type='hidden' name='question_id[]' id='qID_9' value='25230' \/><input type='hidden' id='answerType25230' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25230[]' id='answer-id-104248' class='answer   answerof-25230 ' value='104248'   \/><label for='answer-id-104248' id='answer-label-104248' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25230[]' id='answer-id-104249' class='answer   answerof-25230 ' value='104249'   \/><label for='answer-id-104249' id='answer-label-104249' class=' answer'><span>Either I or II, but not both.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25230[]' id='answer-id-104250' class='answer   answerof-25230 ' value='104250'   \/><label for='answer-id-104250' id='answer-label-104250' class=' answer'><span>I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-10' style=';'><div id='questionWrap-10'  class='   watupro-question-id-25231'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>10. <\/span>Because of the risk of material misstatement, an audit of financial statements in accordance with generally accepted auditing standards should be planned and performed with an attitude of:<\/div><input type='hidden' name='question_id[]' id='qID_10' value='25231' \/><input type='hidden' id='answerType25231' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25231[]' id='answer-id-104251' class='answer   answerof-25231 ' value='104251'   \/><label for='answer-id-104251' id='answer-label-104251' class=' answer'><span>Objective judgment.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25231[]' id='answer-id-104252' class='answer   answerof-25231 ' value='104252'   \/><label for='answer-id-104252' id='answer-label-104252' class=' answer'><span>Independent integrity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25231[]' id='answer-id-104253' class='answer   answerof-25231 ' value='104253'   \/><label for='answer-id-104253' id='answer-label-104253' class=' answer'><span>Professional skepticism.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25231[]' id='answer-id-104254' class='answer   answerof-25231 ' value='104254'   \/><label for='answer-id-104254' id='answer-label-104254' class=' answer'><span>Impartial conservatism.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-11' style=';'><div id='questionWrap-11'  class='   watupro-question-id-25232'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>11. <\/span>Which of the following categories is included in generally accepted auditing standards?<\/div><input type='hidden' name='question_id[]' id='qID_11' value='25232' \/><input type='hidden' id='answerType25232' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25232[]' id='answer-id-104255' class='answer   answerof-25232 ' value='104255'   \/><label for='answer-id-104255' id='answer-label-104255' class=' answer'><span>Standards of review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25232[]' id='answer-id-104256' class='answer   answerof-25232 ' value='104256'   \/><label for='answer-id-104256' id='answer-label-104256' class=' answer'><span>Standards of planning.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25232[]' id='answer-id-104257' class='answer   answerof-25232 ' value='104257'   \/><label for='answer-id-104257' id='answer-label-104257' class=' answer'><span>Standards of fieldwork.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25232[]' id='answer-id-104258' class='answer   answerof-25232 ' value='104258'   \/><label for='answer-id-104258' id='answer-label-104258' class=' answer'><span>Standards of evidence.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-12' style=';'><div id='questionWrap-12'  class='   watupro-question-id-25233'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>12. <\/span>When qualifying an opinion because of an insufficiency of audit evidence, an auditor should refer to the situation in the: <br \/>\r<br><br><img decoding=\"async\" width=297 height=114 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image002.jpg\" v:shapes=\"_x0000_i1025\"><br><\/div><input type='hidden' name='question_id[]' id='qID_12' value='25233' \/><input type='hidden' id='answerType25233' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25233[]' id='answer-id-104259' class='answer   answerof-25233 ' value='104259'   \/><label for='answer-id-104259' id='answer-label-104259' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25233[]' id='answer-id-104260' class='answer   answerof-25233 ' value='104260'   \/><label for='answer-id-104260' id='answer-label-104260' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25233[]' id='answer-id-104261' class='answer   answerof-25233 ' value='104261'   \/><label for='answer-id-104261' id='answer-label-104261' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25233[]' id='answer-id-104262' class='answer   answerof-25233 ' value='104262'   \/><label for='answer-id-104262' id='answer-label-104262' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-13' style=';'><div id='questionWrap-13'  class='   watupro-question-id-25234'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>13. <\/span>When an auditor believes there is substantial doubt about the ability of an entity to continue as a going concern, all of the following should be included in the audit documentation, except:<\/div><input type='hidden' name='question_id[]' id='qID_13' value='25234' \/><input type='hidden' id='answerType25234' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25234[]' id='answer-id-104263' class='answer   answerof-25234 ' value='104263'   \/><label for='answer-id-104263' id='answer-label-104263' class=' answer'><span>The conditions that gave rise to the substantial doubt.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25234[]' id='answer-id-104264' class='answer   answerof-25234 ' value='104264'   \/><label for='answer-id-104264' id='answer-label-104264' class=' answer'><span>The auditor's conclusion about whether substantial doubt remains or is alleviated.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25234[]' id='answer-id-104265' class='answer   answerof-25234 ' value='104265'   \/><label for='answer-id-104265' id='answer-label-104265' class=' answer'><span>Management's conclusion regarding whether substantial doubt remains or is alleviated.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25234[]' id='answer-id-104266' class='answer   answerof-25234 ' value='104266'   \/><label for='answer-id-104266' id='answer-label-104266' class=' answer'><span>The effect of the auditor's conclusion on the auditor's report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-14' style=';'><div id='questionWrap-14'  class='   watupro-question-id-25235'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>14. <\/span>After considering an entity's negative trends and financial difficulties, an auditor has substantial doubt about the entity's ability to continue as a going concern. <br \/>\r<br>The auditor's considerations relating to management's plans for dealing with the adverse effects of these conditions most likely would include management's plans to:<\/div><input type='hidden' name='question_id[]' id='qID_14' value='25235' \/><input type='hidden' id='answerType25235' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25235[]' id='answer-id-104267' class='answer   answerof-25235 ' value='104267'   \/><label for='answer-id-104267' id='answer-label-104267' class=' answer'><span>Increase current dividend distributions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25235[]' id='answer-id-104268' class='answer   answerof-25235 ' value='104268'   \/><label for='answer-id-104268' id='answer-label-104268' class=' answer'><span>Reduce existing lines of credit.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25235[]' id='answer-id-104269' class='answer   answerof-25235 ' value='104269'   \/><label for='answer-id-104269' id='answer-label-104269' class=' answer'><span>Increase ownership equity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25235[]' id='answer-id-104270' class='answer   answerof-25235 ' value='104270'   \/><label for='answer-id-104270' id='answer-label-104270' class=' answer'><span>Purchase assets formerly leased.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-15' style=';'><div id='questionWrap-15'  class='   watupro-question-id-25236'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>15. <\/span>In which of the following situations would an auditor ordinarily choose between expressing a qualified opinion or an adverse opinion?<\/div><input type='hidden' name='question_id[]' id='qID_15' value='25236' \/><input type='hidden' id='answerType25236' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25236[]' id='answer-id-104271' class='answer   answerof-25236 ' value='104271'   \/><label for='answer-id-104271' id='answer-label-104271' class=' answer'><span>The auditor did not observe the entity's physical inventory and is unable to become satisfied about its balance by other auditing procedures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25236[]' id='answer-id-104272' class='answer   answerof-25236 ' value='104272'   \/><label for='answer-id-104272' id='answer-label-104272' class=' answer'><span>Conditions that cause the auditor to have substantial doubt about the entity's ability to continue as a going concern are inadequately disclosed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25236[]' id='answer-id-104273' class='answer   answerof-25236 ' value='104273'   \/><label for='answer-id-104273' id='answer-label-104273' class=' answer'><span>There has been a change in accounting principles that has a material effect on the comparability of the entity's financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25236[]' id='answer-id-104274' class='answer   answerof-25236 ' value='104274'   \/><label for='answer-id-104274' id='answer-label-104274' class=' answer'><span>The auditor is unable to apply necessary procedures concerning an investor's share of an investee's earnings recognized on the equity method.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-16' style=';'><div id='questionWrap-16'  class='   watupro-question-id-25237'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>16. <\/span>Which of the following conditions or events most likely would cause an auditor to have substantial doubt about an entity's ability to continue as a going concern?<\/div><input type='hidden' name='question_id[]' id='qID_16' value='25237' \/><input type='hidden' id='answerType25237' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25237[]' id='answer-id-104275' class='answer   answerof-25237 ' value='104275'   \/><label for='answer-id-104275' id='answer-label-104275' class=' answer'><span>Significant related party transactions are pervasive.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25237[]' id='answer-id-104276' class='answer   answerof-25237 ' value='104276'   \/><label for='answer-id-104276' id='answer-label-104276' class=' answer'><span>Usual trade credit from suppliers is denied.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25237[]' id='answer-id-104277' class='answer   answerof-25237 ' value='104277'   \/><label for='answer-id-104277' id='answer-label-104277' class=' answer'><span>Arrearages in preferred stock dividends are paid.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25237[]' id='answer-id-104278' class='answer   answerof-25237 ' value='104278'   \/><label for='answer-id-104278' id='answer-label-104278' class=' answer'><span>Restrictions on the disposal of principal assets are present.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-17' style=';'><div id='questionWrap-17'  class='   watupro-question-id-25238'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>17. <\/span>In the first audit of a client, an auditor was not able to gather sufficient evidence about the consistent application of accounting principles between the current and prior year, as well as the amounts of assets or liabilities at the beginning of the current year. This was due to the client's record retention policies. <br \/>\r<br>If the amounts in question could materially affect current operating results, the auditor would:<\/div><input type='hidden' name='question_id[]' id='qID_17' value='25238' \/><input type='hidden' id='answerType25238' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25238[]' id='answer-id-104279' class='answer   answerof-25238 ' value='104279'   \/><label for='answer-id-104279' id='answer-label-104279' class=' answer'><span>Be unable to express an opinion on the current year's results of operations and cash flows.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25238[]' id='answer-id-104280' class='answer   answerof-25238 ' value='104280'   \/><label for='answer-id-104280' id='answer-label-104280' class=' answer'><span>Express a qualified opinion on the financial statements because of a client-imposed scope limitation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25238[]' id='answer-id-104281' class='answer   answerof-25238 ' value='104281'   \/><label for='answer-id-104281' id='answer-label-104281' class=' answer'><span>Withdraw from the engagement and refuse to be associated with the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25238[]' id='answer-id-104282' class='answer   answerof-25238 ' value='104282'   \/><label for='answer-id-104282' id='answer-label-104282' class=' answer'><span>Specifically state that the financial statements are not comparable to the prior year due to an uncertainty.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-18' style=';'><div id='questionWrap-18'  class='   watupro-question-id-25239'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>18. <\/span>Pell, CPA, decides to serve as principal auditor in the audit of the financial statements of Tech Consolidated, Inc. Smith, CPA, audits one of Tech's subsidiaries. <br \/>\r<br>In which situation(s) should Pell make reference to Smith's audit? <br \/>\r<br>I. Pell reviews Smith's audit documentation and assumes responsibility for Smith's work, but expresses a qualified opinion on Tech's financial statements. <br \/>\r<br>II. Pell is unable to review Smith's audit documentation; however, Pell's inquiries indicate that Smith has an excellent reputation for professional competence and integrity.<\/div><input type='hidden' name='question_id[]' id='qID_18' value='25239' \/><input type='hidden' id='answerType25239' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25239[]' id='answer-id-104283' class='answer   answerof-25239 ' value='104283'   \/><label for='answer-id-104283' id='answer-label-104283' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25239[]' id='answer-id-104284' class='answer   answerof-25239 ' value='104284'   \/><label for='answer-id-104284' id='answer-label-104284' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25239[]' id='answer-id-104285' class='answer   answerof-25239 ' value='104285'   \/><label for='answer-id-104285' id='answer-label-104285' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25239[]' id='answer-id-104286' class='answer   answerof-25239 ' value='104286'   \/><label for='answer-id-104286' id='answer-label-104286' class=' answer'><span>Neither I nor I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-19' style=';'><div id='questionWrap-19'  class='   watupro-question-id-25240'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>19. <\/span>Cooper, CPA, believes there is substantial doubt about the ability of Zero Corp. to continue as a going concern for a reasonable period of time. <br \/>\r<br>In evaluating Zero's plans for dealing with the adverse effects of future conditions and events, Cooper most likely would consider, as a mitigating factor, Zero's plans to:<\/div><input type='hidden' name='question_id[]' id='qID_19' value='25240' \/><input type='hidden' id='answerType25240' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25240[]' id='answer-id-104287' class='answer   answerof-25240 ' value='104287'   \/><label for='answer-id-104287' id='answer-label-104287' class=' answer'><span>Discuss with lenders the terms of all debt and loan agreements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25240[]' id='answer-id-104288' class='answer   answerof-25240 ' value='104288'   \/><label for='answer-id-104288' id='answer-label-104288' class=' answer'><span>Strengthen internal controls over cash disbursements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25240[]' id='answer-id-104289' class='answer   answerof-25240 ' value='104289'   \/><label for='answer-id-104289' id='answer-label-104289' class=' answer'><span>Purchase production facilities currently being leased from a related party.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25240[]' id='answer-id-104290' class='answer   answerof-25240 ' value='104290'   \/><label for='answer-id-104290' id='answer-label-104290' class=' answer'><span>Postpone expenditures for research and development projects.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-20' style=';'><div id='questionWrap-20'  class='   watupro-question-id-25241'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>20. <\/span>Which of the following statements is a basic element of the auditor's standard report?<\/div><input type='hidden' name='question_id[]' id='qID_20' value='25241' \/><input type='hidden' id='answerType25241' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25241[]' id='answer-id-104291' class='answer   answerof-25241 ' value='104291'   \/><label for='answer-id-104291' id='answer-label-104291' class=' answer'><span>The disclosures provide reasonable assurance that the financial statements are free of material misstatement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25241[]' id='answer-id-104292' class='answer   answerof-25241 ' value='104292'   \/><label for='answer-id-104292' id='answer-label-104292' class=' answer'><span>The auditor evaluated the overall internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25241[]' id='answer-id-104293' class='answer   answerof-25241 ' value='104293'   \/><label for='answer-id-104293' id='answer-label-104293' class=' answer'><span>An audit includes assessing significant estimates made by management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25241[]' id='answer-id-104294' class='answer   answerof-25241 ' value='104294'   \/><label for='answer-id-104294' id='answer-label-104294' class=' answer'><span>The financial statements are consistent with those of the prior period.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-21' style=';'><div id='questionWrap-21'  class='   watupro-question-id-25242'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>21. <\/span>An auditor may not issue a qualified opinion when:<\/div><input type='hidden' name='question_id[]' id='qID_21' value='25242' \/><input type='hidden' id='answerType25242' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25242[]' id='answer-id-104295' class='answer   answerof-25242 ' value='104295'   \/><label for='answer-id-104295' id='answer-label-104295' class=' answer'><span>An accounting principle at variance with GAAP is used<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25242[]' id='answer-id-104296' class='answer   answerof-25242 ' value='104296'   \/><label for='answer-id-104296' id='answer-label-104296' class=' answer'><span>The auditor lacks independence with respect to the audited entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25242[]' id='answer-id-104297' class='answer   answerof-25242 ' value='104297'   \/><label for='answer-id-104297' id='answer-label-104297' class=' answer'><span>A scope limitation prevents the auditor from completing an important audit procedure.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25242[]' id='answer-id-104298' class='answer   answerof-25242 ' value='104298'   \/><label for='answer-id-104298' id='answer-label-104298' class=' answer'><span>The auditor's report refers to the work of a specialist.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-22' style=';'><div id='questionWrap-22'  class='   watupro-question-id-25243'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>22. <\/span>An auditor most likely would express an unqualified opinion and would not add explanatory language to the report if the auditor:<\/div><input type='hidden' name='question_id[]' id='qID_22' value='25243' \/><input type='hidden' id='answerType25243' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25243[]' id='answer-id-104299' class='answer   answerof-25243 ' value='104299'   \/><label for='answer-id-104299' id='answer-label-104299' class=' answer'><span>Wishes to emphasize that the entity had significant transactions with related parties.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25243[]' id='answer-id-104300' class='answer   answerof-25243 ' value='104300'   \/><label for='answer-id-104300' id='answer-label-104300' class=' answer'><span>Concurs with the entity's change in its method of computing depreciation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25243[]' id='answer-id-104301' class='answer   answerof-25243 ' value='104301'   \/><label for='answer-id-104301' id='answer-label-104301' class=' answer'><span>Discovers that supplementary information required by FASB has been omitted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25243[]' id='answer-id-104302' class='answer   answerof-25243 ' value='104302'   \/><label for='answer-id-104302' id='answer-label-104302' class=' answer'><span>Believes that there is a probable likelihood of a material loss resulting from an uncertainty that is sufficiently supported and disclosed.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-23' style=';'><div id='questionWrap-23'  class='   watupro-question-id-25244'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>23. <\/span>An auditor would express an unqualified opinion with an explanatory paragraph added to the auditor's report for: <br \/>\r<br><br><img decoding=\"async\" width=323 height=116 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image004.jpg\" v:shapes=\"_x0000_i1026\"><br><\/div><input type='hidden' name='question_id[]' id='qID_23' value='25244' \/><input type='hidden' id='answerType25244' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25244[]' id='answer-id-104303' class='answer   answerof-25244 ' value='104303'   \/><label for='answer-id-104303' id='answer-label-104303' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25244[]' id='answer-id-104304' class='answer   answerof-25244 ' value='104304'   \/><label for='answer-id-104304' id='answer-label-104304' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25244[]' id='answer-id-104305' class='answer   answerof-25244 ' value='104305'   \/><label for='answer-id-104305' id='answer-label-104305' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25244[]' id='answer-id-104306' class='answer   answerof-25244 ' value='104306'   \/><label for='answer-id-104306' id='answer-label-104306' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-24' style=';'><div id='questionWrap-24'  class='   watupro-question-id-25245'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>24. <\/span>Digit Co. uses the FIFO method of costing for its international subsidiary's inventory and LIFO for its domestic inventory. <br \/>\r<br>Under these circumstances, the auditor's report on Digit's financial statements should express an:<\/div><input type='hidden' name='question_id[]' id='qID_24' value='25245' \/><input type='hidden' id='answerType25245' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25245[]' id='answer-id-104307' class='answer   answerof-25245 ' value='104307'   \/><label for='answer-id-104307' id='answer-label-104307' class=' answer'><span>Unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25245[]' id='answer-id-104308' class='answer   answerof-25245 ' value='104308'   \/><label for='answer-id-104308' id='answer-label-104308' class=' answer'><span>Opinion qualified because of a lack of consistency.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25245[]' id='answer-id-104309' class='answer   answerof-25245 ' value='104309'   \/><label for='answer-id-104309' id='answer-label-104309' class=' answer'><span>Opinion qualified because of a departure from GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25245[]' id='answer-id-104310' class='answer   answerof-25245 ' value='104310'   \/><label for='answer-id-104310' id='answer-label-104310' class=' answer'><span>Adverse opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-25' style=';'><div id='questionWrap-25'  class='   watupro-question-id-25246'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>25. <\/span>In which of the following circumstances would an auditor not express an unqualified opinion?<\/div><input type='hidden' name='question_id[]' id='qID_25' value='25246' \/><input type='hidden' id='answerType25246' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25246[]' id='answer-id-104311' class='answer   answerof-25246 ' value='104311'   \/><label for='answer-id-104311' id='answer-label-104311' class=' answer'><span>There has been a material change between periods in accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25246[]' id='answer-id-104312' class='answer   answerof-25246 ' value='104312'   \/><label for='answer-id-104312' id='answer-label-104312' class=' answer'><span>Quarterly financial data required by the SEC has been omitted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25246[]' id='answer-id-104313' class='answer   answerof-25246 ' value='104313'   \/><label for='answer-id-104313' id='answer-label-104313' class=' answer'><span>The auditor wishes to emphasize an unusually important subsequent event.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25246[]' id='answer-id-104314' class='answer   answerof-25246 ' value='104314'   \/><label for='answer-id-104314' id='answer-label-104314' class=' answer'><span>The auditor is unable to obtain audited financial statements of a consolidated investee.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-26' style=';'><div id='questionWrap-26'  class='   watupro-question-id-25247'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>26. <\/span>Management of Edington Industries plans to disclose an uncertainty as follows: The Company is a defendant in a lawsuit alleging infringement of certain patent rights and claiming damages. Discovery proceedings are in progress. The ultimate outcome of the litigation cannot presently be determined. Accordingly, no provision for any liability that may result upon adjudication has been made in the accompanying financial statements. The auditor is satisfied that sufficient audit evidence supports management's assertions about the nature and disclosure of the uncertainty. <br \/>\r<br>What type of opinion should the auditor express under these circumstances?<\/div><input type='hidden' name='question_id[]' id='qID_26' value='25247' \/><input type='hidden' id='answerType25247' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25247[]' id='answer-id-104315' class='answer   answerof-25247 ' value='104315'   \/><label for='answer-id-104315' id='answer-label-104315' class=' answer'><span>Unqualified without an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25247[]' id='answer-id-104316' class='answer   answerof-25247 ' value='104316'   \/><label for='answer-id-104316' id='answer-label-104316' class=' answer'><span>&quot;Subject to&quot; qualified.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25247[]' id='answer-id-104317' class='answer   answerof-25247 ' value='104317'   \/><label for='answer-id-104317' id='answer-label-104317' class=' answer'><span>&quot;Except for&quot; qualified.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25247[]' id='answer-id-104318' class='answer   answerof-25247 ' value='104318'   \/><label for='answer-id-104318' id='answer-label-104318' class=' answer'><span>Disclaimer of opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-27' style=';'><div id='questionWrap-27'  class='   watupro-question-id-25248'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>27. <\/span>Kane, CPA, concludes that there is substantial doubt about Lima Co.'s ability to continue as a going concern for a reasonable period of time. <br \/>\r<br>If Lima's financial statements adequately disclose its financial difficulties, Kane's auditor's report is required to include an explanatory paragraph that specifically uses the phrase(s): <br \/>\r<br><br><img decoding=\"async\" width=495 height=114 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image006.jpg\" v:shapes=\"_x0000_i1027\"><br><\/div><input type='hidden' name='question_id[]' id='qID_27' value='25248' \/><input type='hidden' id='answerType25248' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25248[]' id='answer-id-104319' class='answer   answerof-25248 ' value='104319'   \/><label for='answer-id-104319' id='answer-label-104319' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25248[]' id='answer-id-104320' class='answer   answerof-25248 ' value='104320'   \/><label for='answer-id-104320' id='answer-label-104320' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25248[]' id='answer-id-104321' class='answer   answerof-25248 ' value='104321'   \/><label for='answer-id-104321' id='answer-label-104321' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25248[]' id='answer-id-104322' class='answer   answerof-25248 ' value='104322'   \/><label for='answer-id-104322' id='answer-label-104322' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-28' style=';'><div id='questionWrap-28'  class='   watupro-question-id-25249'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>28. <\/span>Mead, CPA, had substantial doubt about Tech Co.'s ability to continue as a going concern when reporting on Tech's audited financial statements for the year ended June 30, 19X4. That doubt has been removed in 19X5. <br \/>\r<br>What is Mead's reporting responsibility if Tech is presenting its financial statements for the year ended June 30, 19X5, on a comparative basis with those of 19X4?<\/div><input type='hidden' name='question_id[]' id='qID_28' value='25249' \/><input type='hidden' id='answerType25249' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25249[]' id='answer-id-104323' class='answer   answerof-25249 ' value='104323'   \/><label for='answer-id-104323' id='answer-label-104323' class=' answer'><span>The explanatory paragraph included in the 19X4 auditor's report should not be repeated.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25249[]' id='answer-id-104324' class='answer   answerof-25249 ' value='104324'   \/><label for='answer-id-104324' id='answer-label-104324' class=' answer'><span>The explanatory paragraph included in the 19X4 auditor's report should be repeated in its entirety.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25249[]' id='answer-id-104325' class='answer   answerof-25249 ' value='104325'   \/><label for='answer-id-104325' id='answer-label-104325' class=' answer'><span>A different explanatory paragraph describing Mead's reasons for the removal of doubt should be included.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25249[]' id='answer-id-104326' class='answer   answerof-25249 ' value='104326'   \/><label for='answer-id-104326' id='answer-label-104326' class=' answer'><span>A different explanatory paragraph describing Tech's plans for financial recovery should be included.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-29' style=';'><div id='questionWrap-29'  class='   watupro-question-id-25250'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>29. <\/span>March, CPA, is engaged by Monday Corp., a client, to audit the financial statements of Wall Corp., a company that is not March's client. Monday expects to present Wall's audited financial statements with March's auditor's report to 1st Federal Bank to obtain financing in Monday's attempt to purchase Wall. <br \/>\r<br>In these circumstances, March's auditor's report would usually be addressed to:<\/div><input type='hidden' name='question_id[]' id='qID_29' value='25250' \/><input type='hidden' id='answerType25250' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25250[]' id='answer-id-104327' class='answer   answerof-25250 ' value='104327'   \/><label for='answer-id-104327' id='answer-label-104327' class=' answer'><span>Monday Corp., the client that engaged March.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25250[]' id='answer-id-104328' class='answer   answerof-25250 ' value='104328'   \/><label for='answer-id-104328' id='answer-label-104328' class=' answer'><span>Wall Corp., the entity audited by March.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25250[]' id='answer-id-104329' class='answer   answerof-25250 ' value='104329'   \/><label for='answer-id-104329' id='answer-label-104329' class=' answer'><span>1st Federal Bank.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25250[]' id='answer-id-104330' class='answer   answerof-25250 ' value='104330'   \/><label for='answer-id-104330' id='answer-label-104330' class=' answer'><span>Both Monday Corp. and 1st Federal Bank.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-30' style=';'><div id='questionWrap-30'  class='   watupro-question-id-25251'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>30. <\/span>An auditor issued an audit report that was dual dated for a subsequent event occurring after the original date of the auditor's report but before issuance of the related financial statements. <br \/>\r<br>The auditor's responsibility for events occurring subsequent to the original report date was:<\/div><input type='hidden' name='question_id[]' id='qID_30' value='25251' \/><input type='hidden' id='answerType25251' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25251[]' id='answer-id-104331' class='answer   answerof-25251 ' value='104331'   \/><label for='answer-id-104331' id='answer-label-104331' class=' answer'><span>Limited to include only events occurring up to the date of the last subsequent event referenced.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25251[]' id='answer-id-104332' class='answer   answerof-25251 ' value='104332'   \/><label for='answer-id-104332' id='answer-label-104332' class=' answer'><span>Limited to the specific event referenced.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25251[]' id='answer-id-104333' class='answer   answerof-25251 ' value='104333'   \/><label for='answer-id-104333' id='answer-label-104333' class=' answer'><span>Extended to subsequent events occurring through the later date.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25251[]' id='answer-id-104334' class='answer   answerof-25251 ' value='104334'   \/><label for='answer-id-104334' id='answer-label-104334' class=' answer'><span>Extended to include all events occurring since the original report date.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-31' style=';'><div id='questionWrap-31'  class='   watupro-question-id-25252'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>31. <\/span>When an independent CPA is associated with the financial statements of a publicly held entity but has not audited or reviewed such statements, the appropriate form of report to be issued must include a(an):<\/div><input type='hidden' name='question_id[]' id='qID_31' value='25252' \/><input type='hidden' id='answerType25252' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25252[]' id='answer-id-104335' class='answer   answerof-25252 ' value='104335'   \/><label for='answer-id-104335' id='answer-label-104335' class=' answer'><span>Regulation S-X exemption.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25252[]' id='answer-id-104336' class='answer   answerof-25252 ' value='104336'   \/><label for='answer-id-104336' id='answer-label-104336' class=' answer'><span>Report on pro forma financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25252[]' id='answer-id-104337' class='answer   answerof-25252 ' value='104337'   \/><label for='answer-id-104337' id='answer-label-104337' class=' answer'><span>Unaudited association report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25252[]' id='answer-id-104338' class='answer   answerof-25252 ' value='104338'   \/><label for='answer-id-104338' id='answer-label-104338' class=' answer'><span>Disclaimer of opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-32' style=';'><div id='questionWrap-32'  class='   watupro-question-id-25253'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>32. <\/span>Which of the following auditing procedures most likely would assist an auditor in identifying conditions and events that may indicate substantial doubt about an entity's ability to continue as a going concern?<\/div><input type='hidden' name='question_id[]' id='qID_32' value='25253' \/><input type='hidden' id='answerType25253' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25253[]' id='answer-id-104339' class='answer   answerof-25253 ' value='104339'   \/><label for='answer-id-104339' id='answer-label-104339' class=' answer'><span>Inspecting title documents to verify whether any assets are pledged as collateral.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25253[]' id='answer-id-104340' class='answer   answerof-25253 ' value='104340'   \/><label for='answer-id-104340' id='answer-label-104340' class=' answer'><span>Confirming with third parties the details of arrangements to maintain financial support.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25253[]' id='answer-id-104341' class='answer   answerof-25253 ' value='104341'   \/><label for='answer-id-104341' id='answer-label-104341' class=' answer'><span>Reconciling the cash balance per books with the cut-off bank statement and the bank confirmation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25253[]' id='answer-id-104342' class='answer   answerof-25253 ' value='104342'   \/><label for='answer-id-104342' id='answer-label-104342' class=' answer'><span>Comparing the entity's depreciation and asset capitalization policies to other entities in the industry.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-33' style=';'><div id='questionWrap-33'  class='   watupro-question-id-25254'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>33. <\/span>When an independent CPA assists in preparing the financial statements of a publicly held entity, but has not audited or reviewed them, the CPA should issue a disclaimer of opinion. <br \/>\r<br>In such situations, the CPA has no responsibility to apply any procedures beyond:<\/div><input type='hidden' name='question_id[]' id='qID_33' value='25254' \/><input type='hidden' id='answerType25254' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25254[]' id='answer-id-104343' class='answer   answerof-25254 ' value='104343'   \/><label for='answer-id-104343' id='answer-label-104343' class=' answer'><span>Documenting that internal control is not being relied on.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25254[]' id='answer-id-104344' class='answer   answerof-25254 ' value='104344'   \/><label for='answer-id-104344' id='answer-label-104344' class=' answer'><span>Reading the financial statements for obvious material misstatements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25254[]' id='answer-id-104345' class='answer   answerof-25254 ' value='104345'   \/><label for='answer-id-104345' id='answer-label-104345' class=' answer'><span>Ascertaining whether the financial statements are in conformity with GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25254[]' id='answer-id-104346' class='answer   answerof-25254 ' value='104346'   \/><label for='answer-id-104346' id='answer-label-104346' class=' answer'><span>Determining whether management has elected to omit substantially all required disclosures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-34' style=';'><div id='questionWrap-34'  class='   watupro-question-id-25255'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>34. <\/span>When an auditor concludes there is substantial doubt about a continuing audit client's ability to continue as a going concern for a reasonable period of time, the auditor's responsibility is to:<\/div><input type='hidden' name='question_id[]' id='qID_34' value='25255' \/><input type='hidden' id='answerType25255' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25255[]' id='answer-id-104347' class='answer   answerof-25255 ' value='104347'   \/><label for='answer-id-104347' id='answer-label-104347' class=' answer'><span>Issue a qualified or adverse opinion, depending upon materiality, due to the possible effects on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25255[]' id='answer-id-104348' class='answer   answerof-25255 ' value='104348'   \/><label for='answer-id-104348' id='answer-label-104348' class=' answer'><span>Consider the adequacy of disclosure about the client's possible inability to continue as a going concern.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25255[]' id='answer-id-104349' class='answer   answerof-25255 ' value='104349'   \/><label for='answer-id-104349' id='answer-label-104349' class=' answer'><span>Report to the client's audit committee that management's accounting estimates may need to be adjusted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25255[]' id='answer-id-104350' class='answer   answerof-25255 ' value='104350'   \/><label for='answer-id-104350' id='answer-label-104350' class=' answer'><span>Reissue the prior year's auditor's report and add an explanatory paragraph that specifically refers to &quot;substantial doubt&quot; and &quot;going concern.&quot;<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-35' style=';'><div id='questionWrap-35'  class='   watupro-question-id-25256'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>35. <\/span>Reference in a principal auditor's report to the fact that part of the audit was performed by another auditor most likely would be an indication of the:<\/div><input type='hidden' name='question_id[]' id='qID_35' value='25256' \/><input type='hidden' id='answerType25256' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25256[]' id='answer-id-104351' class='answer   answerof-25256 ' value='104351'   \/><label for='answer-id-104351' id='answer-label-104351' class=' answer'><span>Divided responsibility between the auditors who conducted the audits of the components of the overall financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25256[]' id='answer-id-104352' class='answer   answerof-25256 ' value='104352'   \/><label for='answer-id-104352' id='answer-label-104352' class=' answer'><span>Lack of materiality of the portion of the financial statements audited by the other auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25256[]' id='answer-id-104353' class='answer   answerof-25256 ' value='104353'   \/><label for='answer-id-104353' id='answer-label-104353' class=' answer'><span>Principal auditor's recognition of the other auditor's competence, reputation, and professional certification.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25256[]' id='answer-id-104354' class='answer   answerof-25256 ' value='104354'   \/><label for='answer-id-104354' id='answer-label-104354' class=' answer'><span>Different opinions the auditors are expressing on the components of the financial statements that each audited.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-36' style=';'><div id='questionWrap-36'  class='   watupro-question-id-25257'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>36. <\/span>An auditor includes a separate paragraph in an otherwise unmodified report to emphasize that the entity being reported on had significant transactions with related parties. <br \/>\r<br>The inclusion of this separate paragraph:<\/div><input type='hidden' name='question_id[]' id='qID_36' value='25257' \/><input type='hidden' id='answerType25257' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25257[]' id='answer-id-104355' class='answer   answerof-25257 ' value='104355'   \/><label for='answer-id-104355' id='answer-label-104355' class=' answer'><span>Is considered an &quot;except for&quot; qualification of the opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25257[]' id='answer-id-104356' class='answer   answerof-25257 ' value='104356'   \/><label for='answer-id-104356' id='answer-label-104356' class=' answer'><span>Violates generally accepted auditing standards if this information is already disclosed in footnotes to the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25257[]' id='answer-id-104357' class='answer   answerof-25257 ' value='104357'   \/><label for='answer-id-104357' id='answer-label-104357' class=' answer'><span>Necessitates a revision of the opinion paragraph to include the phrase &quot;with the foregoing Explanation&quot;<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25257[]' id='answer-id-104358' class='answer   answerof-25257 ' value='104358'   \/><label for='answer-id-104358' id='answer-label-104358' class=' answer'><span>Is appropriate and would not negate the unqualified opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-37' style=';'><div id='questionWrap-37'  class='   watupro-question-id-25258'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>37. <\/span>When there has been a change in accounting principles, but the effect of the change on the comparability of the financial statements is not material, the auditor should:<\/div><input type='hidden' name='question_id[]' id='qID_37' value='25258' \/><input type='hidden' id='answerType25258' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25258[]' id='answer-id-104359' class='answer   answerof-25258 ' value='104359'   \/><label for='answer-id-104359' id='answer-label-104359' class=' answer'><span>Refer to the change in an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25258[]' id='answer-id-104360' class='answer   answerof-25258 ' value='104360'   \/><label for='answer-id-104360' id='answer-label-104360' class=' answer'><span>Explicitly concur that the change is preferred.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25258[]' id='answer-id-104361' class='answer   answerof-25258 ' value='104361'   \/><label for='answer-id-104361' id='answer-label-104361' class=' answer'><span>Not refer to consistency in the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25258[]' id='answer-id-104362' class='answer   answerof-25258 ' value='104362'   \/><label for='answer-id-104362' id='answer-label-104362' class=' answer'><span>Refer to the change in the opinion paragraph.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-38' style=';'><div id='questionWrap-38'  class='   watupro-question-id-25259'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>38. <\/span>When single-year financial statements are presented, an auditor ordinarily would express an unqualified opinion in an unmodified report if the:<\/div><input type='hidden' name='question_id[]' id='qID_38' value='25259' \/><input type='hidden' id='answerType25259' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25259[]' id='answer-id-104363' class='answer   answerof-25259 ' value='104363'   \/><label for='answer-id-104363' id='answer-label-104363' class=' answer'><span>Auditor is unable to obtain audited financial statements supporting the entity's investment in a foreign affiliate.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25259[]' id='answer-id-104364' class='answer   answerof-25259 ' value='104364'   \/><label for='answer-id-104364' id='answer-label-104364' class=' answer'><span>Entity declines to present a statement of cash flows with its balance sheet and related statements of income and retained earnings.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25259[]' id='answer-id-104365' class='answer   answerof-25259 ' value='104365'   \/><label for='answer-id-104365' id='answer-label-104365' class=' answer'><span>Auditor wishes to emphasize an accounting matter affecting the comparability of the financial statements with those of the prior year.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25259[]' id='answer-id-104366' class='answer   answerof-25259 ' value='104366'   \/><label for='answer-id-104366' id='answer-label-104366' class=' answer'><span>Prior year's financial statements were audited by another CPA whose report, which expressed an unqualified opinion, is not presented.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-39' style=';'><div id='questionWrap-39'  class='   watupro-question-id-25260'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>39. <\/span>Park, CPA, was engaged to audit the financial statements of Tech Co., a new client, for the year ended December 31, 20X3. Park obtained sufficient audit evidence for all of Tech's financial statement items except Tech's opening inventory. Due to inadequate financial records, Park could not verify Tech's January 1, 20X3, inventory balances. <br \/>\r<br>Park's opinion on Tech's 20X3 financial statements most likely will be: <br \/>\r<br><br><img decoding=\"async\" width=308 height=99 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image008.jpg\" v:shapes=\"_x0000_i1028\"><br><\/div><input type='hidden' name='question_id[]' id='qID_39' value='25260' \/><input type='hidden' id='answerType25260' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25260[]' id='answer-id-104367' class='answer   answerof-25260 ' value='104367'   \/><label for='answer-id-104367' id='answer-label-104367' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25260[]' id='answer-id-104368' class='answer   answerof-25260 ' value='104368'   \/><label for='answer-id-104368' id='answer-label-104368' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25260[]' id='answer-id-104369' class='answer   answerof-25260 ' value='104369'   \/><label for='answer-id-104369' id='answer-label-104369' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25260[]' id='answer-id-104370' class='answer   answerof-25260 ' value='104370'   \/><label for='answer-id-104370' id='answer-label-104370' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-40' style=';'><div id='questionWrap-40'  class='   watupro-question-id-25261'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>40. <\/span>When disclaiming an opinion due to a client-imposed scope limitation, an auditor should indicate in a separate paragraph why the audit did not comply with generally accepted auditing standards. <br \/>\r<br>The auditor should also omit the: <br \/>\r<br><br><img decoding=\"async\" width=358 height=94 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image010.jpg\" v:shapes=\"_x0000_i1029\"><br><\/div><input type='hidden' name='question_id[]' id='qID_40' value='25261' \/><input type='hidden' id='answerType25261' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25261[]' id='answer-id-104371' class='answer   answerof-25261 ' value='104371'   \/><label for='answer-id-104371' id='answer-label-104371' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25261[]' id='answer-id-104372' class='answer   answerof-25261 ' value='104372'   \/><label for='answer-id-104372' id='answer-label-104372' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25261[]' id='answer-id-104373' class='answer   answerof-25261 ' value='104373'   \/><label for='answer-id-104373' id='answer-label-104373' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25261[]' id='answer-id-104374' class='answer   answerof-25261 ' value='104374'   \/><label for='answer-id-104374' id='answer-label-104374' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-41' style=';'><div id='questionWrap-41'  class='   watupro-question-id-25262'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>41. <\/span>An auditor decides to issue a qualified opinion on an entity's financial statements because a major inadequacy in its computerized accounting records prevents the auditor from applying necessary procedures. <br \/>\r<br>The opinion paragraph of the auditor's report should state that the qualification pertains to:<\/div><input type='hidden' name='question_id[]' id='qID_41' value='25262' \/><input type='hidden' id='answerType25262' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25262[]' id='answer-id-104375' class='answer   answerof-25262 ' value='104375'   \/><label for='answer-id-104375' id='answer-label-104375' class=' answer'><span>A client-imposed scope limitation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25262[]' id='answer-id-104376' class='answer   answerof-25262 ' value='104376'   \/><label for='answer-id-104376' id='answer-label-104376' class=' answer'><span>A departure from generally accepted auditing standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25262[]' id='answer-id-104377' class='answer   answerof-25262 ' value='104377'   \/><label for='answer-id-104377' id='answer-label-104377' class=' answer'><span>The possible effects on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25262[]' id='answer-id-104378' class='answer   answerof-25262 ' value='104378'   \/><label for='answer-id-104378' id='answer-label-104378' class=' answer'><span>Inadequate disclosure of necessary information.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-42' style=';'><div id='questionWrap-42'  class='   watupro-question-id-25263'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>42. <\/span>When an auditor qualifies an opinion because of inadequate disclosure, the auditor should describe the nature of the omission in a separate explanatory paragraph and modify the: <br \/>\r<br><br><img decoding=\"async\" width=392 height=96 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image012.jpg\" v:shapes=\"_x0000_i1030\"><br><\/div><input type='hidden' name='question_id[]' id='qID_42' value='25263' \/><input type='hidden' id='answerType25263' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25263[]' id='answer-id-104379' class='answer   answerof-25263 ' value='104379'   \/><label for='answer-id-104379' id='answer-label-104379' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25263[]' id='answer-id-104380' class='answer   answerof-25263 ' value='104380'   \/><label for='answer-id-104380' id='answer-label-104380' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25263[]' id='answer-id-104381' class='answer   answerof-25263 ' value='104381'   \/><label for='answer-id-104381' id='answer-label-104381' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25263[]' id='answer-id-104382' class='answer   answerof-25263 ' value='104382'   \/><label for='answer-id-104382' id='answer-label-104382' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-43' style=';'><div id='questionWrap-43'  class='   watupro-question-id-25264'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>43. <\/span>An entity changed from the straight-line method to the declining balance method of depreciation for all newly acquired assets. This change has no material effect on the current year's financial statements, but is reasonably certain to have a substantial effect in later years. <br \/>\r<br>If the change is disclosed in the notes to the financial statements, the auditor should issue a report with a(an):<\/div><input type='hidden' name='question_id[]' id='qID_43' value='25264' \/><input type='hidden' id='answerType25264' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25264[]' id='answer-id-104383' class='answer   answerof-25264 ' value='104383'   \/><label for='answer-id-104383' id='answer-label-104383' class=' answer'><span>&quot;Except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25264[]' id='answer-id-104384' class='answer   answerof-25264 ' value='104384'   \/><label for='answer-id-104384' id='answer-label-104384' class=' answer'><span>Explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25264[]' id='answer-id-104385' class='answer   answerof-25264 ' value='104385'   \/><label for='answer-id-104385' id='answer-label-104385' class=' answer'><span>Unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25264[]' id='answer-id-104386' class='answer   answerof-25264 ' value='104386'   \/><label for='answer-id-104386' id='answer-label-104386' class=' answer'><span>Consistency modification.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-44' style=';'><div id='questionWrap-44'  class='   watupro-question-id-25265'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>44. <\/span>If a publicly held company issues financial statements that purport to present its financial position and results of operations but omits the statement of cash flows, the auditor ordinarily will express a(an):<\/div><input type='hidden' name='question_id[]' id='qID_44' value='25265' \/><input type='hidden' id='answerType25265' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25265[]' id='answer-id-104387' class='answer   answerof-25265 ' value='104387'   \/><label for='answer-id-104387' id='answer-label-104387' class=' answer'><span>Disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25265[]' id='answer-id-104388' class='answer   answerof-25265 ' value='104388'   \/><label for='answer-id-104388' id='answer-label-104388' class=' answer'><span>Qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25265[]' id='answer-id-104389' class='answer   answerof-25265 ' value='104389'   \/><label for='answer-id-104389' id='answer-label-104389' class=' answer'><span>Review report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25265[]' id='answer-id-104390' class='answer   answerof-25265 ' value='104390'   \/><label for='answer-id-104390' id='answer-label-104390' class=' answer'><span>Unqualified opinion with a separate explanatory paragraph.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-45' style=';'><div id='questionWrap-45'  class='   watupro-question-id-25266'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>45. <\/span>In which of the following circumstances would an auditor most likely add an explanatory paragraph to the standard report while not affecting the auditor's unqualified opinion?<\/div><input type='hidden' name='question_id[]' id='qID_45' value='25266' \/><input type='hidden' id='answerType25266' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25266[]' id='answer-id-104391' class='answer   answerof-25266 ' value='104391'   \/><label for='answer-id-104391' id='answer-label-104391' class=' answer'><span>The auditor is asked to report on the balance sheet, but not on the other basic financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25266[]' id='answer-id-104392' class='answer   answerof-25266 ' value='104392'   \/><label for='answer-id-104392' id='answer-label-104392' class=' answer'><span>There is substantial doubt about the entity's ability to continue as a going concern.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25266[]' id='answer-id-104393' class='answer   answerof-25266 ' value='104393'   \/><label for='answer-id-104393' id='answer-label-104393' class=' answer'><span>Management's estimates of the effects of future events are unreasonable.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25266[]' id='answer-id-104394' class='answer   answerof-25266 ' value='104394'   \/><label for='answer-id-104394' id='answer-label-104394' class=' answer'><span>Certain transactions cannot be tested because of management's records retention policy.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-46' style=';'><div id='questionWrap-46'  class='   watupro-question-id-25267'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>46. <\/span>When an entity changes its method of accounting for income taxes, which has a material effect on comparability, the auditor should refer to the change in an explanatory paragraph added to the auditor's report. <br \/>\r<br>This paragraph should identify the nature of the change and:<\/div><input type='hidden' name='question_id[]' id='qID_46' value='25267' \/><input type='hidden' id='answerType25267' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25267[]' id='answer-id-104395' class='answer   answerof-25267 ' value='104395'   \/><label for='answer-id-104395' id='answer-label-104395' class=' answer'><span>Explain why the change is justified under generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25267[]' id='answer-id-104396' class='answer   answerof-25267 ' value='104396'   \/><label for='answer-id-104396' id='answer-label-104396' class=' answer'><span>Describe the cumulative effect of the change on the audited financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25267[]' id='answer-id-104397' class='answer   answerof-25267 ' value='104397'   \/><label for='answer-id-104397' id='answer-label-104397' class=' answer'><span>State the auditor's explicit concurrence with or opposition to the change.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25267[]' id='answer-id-104398' class='answer   answerof-25267 ' value='104398'   \/><label for='answer-id-104398' id='answer-label-104398' class=' answer'><span>Refer to the financial statement note that discusses the change in detail.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-47' style=';'><div id='questionWrap-47'  class='   watupro-question-id-25268'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>47. <\/span>Green, CPA, was engaged to audit the financial statements of Essex Co. after its fiscal year had ended. The timing of Green's appointment as auditor and the start of fieldwork made confirmation of accounts receivable by direct communication with the debtors ineffective. <br \/>\r<br>However, Green applied other procedures and was satisfied as to the reasonableness of the account balances. Green's auditor's report most likely contained a(an):<\/div><input type='hidden' name='question_id[]' id='qID_47' value='25268' \/><input type='hidden' id='answerType25268' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25268[]' id='answer-id-104399' class='answer   answerof-25268 ' value='104399'   \/><label for='answer-id-104399' id='answer-label-104399' class=' answer'><span>Unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25268[]' id='answer-id-104400' class='answer   answerof-25268 ' value='104400'   \/><label for='answer-id-104400' id='answer-label-104400' class=' answer'><span>Unqualified opinion with an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25268[]' id='answer-id-104401' class='answer   answerof-25268 ' value='104401'   \/><label for='answer-id-104401' id='answer-label-104401' class=' answer'><span>Qualified opinion due to a scope limitation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25268[]' id='answer-id-104402' class='answer   answerof-25268 ' value='104402'   \/><label for='answer-id-104402' id='answer-label-104402' class=' answer'><span>Qualified opinion due to a departure from generally accepted auditing standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-48' style=';'><div id='questionWrap-48'  class='   watupro-question-id-25269'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>48. <\/span>Davis, CPA, believes there is substantial doubt about the ability of Hill Co. to continue as a going concern for a reasonable period of time. <br \/>\r<br>In evaluating Hill's plans for dealing with the adverse effects of future conditions and events, Davis most likely would consider, as a mitigating factor, Hill's plans to:<\/div><input type='hidden' name='question_id[]' id='qID_48' value='25269' \/><input type='hidden' id='answerType25269' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25269[]' id='answer-id-104403' class='answer   answerof-25269 ' value='104403'   \/><label for='answer-id-104403' id='answer-label-104403' class=' answer'><span>Accelerate research and development projects related to future products.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25269[]' id='answer-id-104404' class='answer   answerof-25269 ' value='104404'   \/><label for='answer-id-104404' id='answer-label-104404' class=' answer'><span>Accumulate treasury stock at prices favorable to Hill's historic price range.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25269[]' id='answer-id-104405' class='answer   answerof-25269 ' value='104405'   \/><label for='answer-id-104405' id='answer-label-104405' class=' answer'><span>Purchase equipment and production facilities currently being leased.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25269[]' id='answer-id-104406' class='answer   answerof-25269 ' value='104406'   \/><label for='answer-id-104406' id='answer-label-104406' class=' answer'><span>Negotiate reductions in required dividends being paid on preferred stock.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-49' style=';'><div id='questionWrap-49'  class='   watupro-question-id-25270'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>49. <\/span>In the auditor's report, the principal auditor decides not to make reference to another CPA who audited a client's subsidiary.<br \/>\r\n<br \/>\r\nThe principal auditor could justify this decision if, among other requirements, the principal auditor:<\/div><input type='hidden' name='question_id[]' id='qID_49' value='25270' \/><input type='hidden' id='answerType25270' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25270[]' id='answer-id-104407' class='answer   answerof-25270 ' value='104407'   \/><label for='answer-id-104407' id='answer-label-104407' class=' answer'><span>Issues an unqualified opinion on the consolidated financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25270[]' id='answer-id-104408' class='answer   answerof-25270 ' value='104408'   \/><label for='answer-id-104408' id='answer-label-104408' class=' answer'><span>Learns that the other CPA issued an unqualified opinion on the subsidiary's financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25270[]' id='answer-id-104409' class='answer   answerof-25270 ' value='104409'   \/><label for='answer-id-104409' id='answer-label-104409' class=' answer'><span>Is unable to review the audit programs and audit documentation of the other CPA.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25270[]' id='answer-id-104410' class='answer   answerof-25270 ' value='104410'   \/><label for='answer-id-104410' id='answer-label-104410' class=' answer'><span>Is satisfied as to the independence and professional reputation of the other CPA.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-50' style=';'><div id='questionWrap-50'  class='   watupro-question-id-25271'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>50. <\/span>A limitation on the scope of an audit sufficient to preclude an unqualified opinion will usually result when management:<\/div><input type='hidden' name='question_id[]' id='qID_50' value='25271' \/><input type='hidden' id='answerType25271' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25271[]' id='answer-id-104411' class='answer   answerof-25271 ' value='104411'   \/><label for='answer-id-104411' id='answer-label-104411' class=' answer'><span>Is unable to obtain audited financial statements supporting the entity's investment in a foreign subsidiary.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25271[]' id='answer-id-104412' class='answer   answerof-25271 ' value='104412'   \/><label for='answer-id-104412' id='answer-label-104412' class=' answer'><span>Refuses to disclose in the notes to the financial statements related party transactions authorized by the Board of Directors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25271[]' id='answer-id-104413' class='answer   answerof-25271 ' value='104413'   \/><label for='answer-id-104413' id='answer-label-104413' class=' answer'><span>Does not provide the auditor with an engagement letter specifying the responsibilities of both the entity and the auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25271[]' id='answer-id-104414' class='answer   answerof-25271 ' value='104414'   \/><label for='answer-id-104414' id='answer-label-104414' class=' answer'><span>Fails to correct a significant deficiency in internal control communicated to those charged with governance after the prior year's audit.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-51' style=';'><div id='questionWrap-51'  class='   watupro-question-id-25272'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>51. <\/span>In which of the following situations would an auditor ordinarily choose between expressing an &quot;except for&quot; qualified opinion or an adverse opinion?<\/div><input type='hidden' name='question_id[]' id='qID_51' value='25272' \/><input type='hidden' id='answerType25272' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25272[]' id='answer-id-104415' class='answer   answerof-25272 ' value='104415'   \/><label for='answer-id-104415' id='answer-label-104415' class=' answer'><span>The auditor did not observe the entity's physical inventory and is unable to become satisfied as to its balance by other auditing procedures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25272[]' id='answer-id-104416' class='answer   answerof-25272 ' value='104416'   \/><label for='answer-id-104416' id='answer-label-104416' class=' answer'><span>The financial statements fail to disclose information that is required by generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25272[]' id='answer-id-104417' class='answer   answerof-25272 ' value='104417'   \/><label for='answer-id-104417' id='answer-label-104417' class=' answer'><span>The auditor is asked to report only on the entity's balance sheet and not on the other basic financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25272[]' id='answer-id-104418' class='answer   answerof-25272 ' value='104418'   \/><label for='answer-id-104418' id='answer-label-104418' class=' answer'><span>Events disclosed in the financial statements cause the auditor to have substantial doubt about the entity's ability to continue as a going concern.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-52' style=';'><div id='questionWrap-52'  class='   watupro-question-id-25273'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>52. <\/span>When an auditor expresses an adverse opinion, the opinion paragraph should include:<\/div><input type='hidden' name='question_id[]' id='qID_52' value='25273' \/><input type='hidden' id='answerType25273' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25273[]' id='answer-id-104419' class='answer   answerof-25273 ' value='104419'   \/><label for='answer-id-104419' id='answer-label-104419' class=' answer'><span>The principal effects of the departure from generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25273[]' id='answer-id-104420' class='answer   answerof-25273 ' value='104420'   \/><label for='answer-id-104420' id='answer-label-104420' class=' answer'><span>A direct reference to a separate paragraph disclosing the basis for the opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25273[]' id='answer-id-104421' class='answer   answerof-25273 ' value='104421'   \/><label for='answer-id-104421' id='answer-label-104421' class=' answer'><span>The substantive reasons for the financial statements being misleading.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25273[]' id='answer-id-104422' class='answer   answerof-25273 ' value='104422'   \/><label for='answer-id-104422' id='answer-label-104422' class=' answer'><span>A description of the uncertainty or scope limitation that prevents an unqualified opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-53' style=';'><div id='questionWrap-53'  class='   watupro-question-id-25274'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>53. <\/span>Under which of the following circumstances would a disclaimer of opinion not be appropriate?<\/div><input type='hidden' name='question_id[]' id='qID_53' value='25274' \/><input type='hidden' id='answerType25274' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25274[]' id='answer-id-104423' class='answer   answerof-25274 ' value='104423'   \/><label for='answer-id-104423' id='answer-label-104423' class=' answer'><span>The financial statements fail to contain adequate disclosure of related party transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25274[]' id='answer-id-104424' class='answer   answerof-25274 ' value='104424'   \/><label for='answer-id-104424' id='answer-label-104424' class=' answer'><span>The client refuses to permit its attorney to furnish information requested in a letter of audit inquiry.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25274[]' id='answer-id-104425' class='answer   answerof-25274 ' value='104425'   \/><label for='answer-id-104425' id='answer-label-104425' class=' answer'><span>The auditor is engaged after fiscal year-end and is unable to observe physical inventories or apply alternative procedures to verify their balances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25274[]' id='answer-id-104426' class='answer   answerof-25274 ' value='104426'   \/><label for='answer-id-104426' id='answer-label-104426' class=' answer'><span>The auditor is unable to determine the amounts associated with illegal acts committed by the client's management.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-54' style=';'><div id='questionWrap-54'  class='   watupro-question-id-25275'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>54. <\/span>Green, CPA, concludes that there is substantial doubt about JKL Co.'s ability to continue as a going concern. <br \/>\r<br>If JKL's financial statements adequately disclose its financial difficulties, Green's auditor's report should: <br \/>\r<br><br><img decoding=\"async\" width=617 height=116 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image014.jpg\" v:shapes=\"_x0000_i1031\"><br><\/div><input type='hidden' name='question_id[]' id='qID_54' value='25275' \/><input type='hidden' id='answerType25275' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25275[]' id='answer-id-104427' class='answer   answerof-25275 ' value='104427'   \/><label for='answer-id-104427' id='answer-label-104427' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25275[]' id='answer-id-104428' class='answer   answerof-25275 ' value='104428'   \/><label for='answer-id-104428' id='answer-label-104428' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25275[]' id='answer-id-104429' class='answer   answerof-25275 ' value='104429'   \/><label for='answer-id-104429' id='answer-label-104429' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25275[]' id='answer-id-104430' class='answer   answerof-25275 ' value='104430'   \/><label for='answer-id-104430' id='answer-label-104430' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-55' style=';'><div id='questionWrap-55'  class='   watupro-question-id-25276'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>55. <\/span>An auditor may reasonably issue an &quot;except for&quot; qualified opinion for a(an): <br \/>\r<br><br><img decoding=\"async\" width=387 height=94 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image016.jpg\" v:shapes=\"_x0000_i1032\"><br><\/div><input type='hidden' name='question_id[]' id='qID_55' value='25276' \/><input type='hidden' id='answerType25276' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25276[]' id='answer-id-104431' class='answer   answerof-25276 ' value='104431'   \/><label for='answer-id-104431' id='answer-label-104431' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25276[]' id='answer-id-104432' class='answer   answerof-25276 ' value='104432'   \/><label for='answer-id-104432' id='answer-label-104432' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25276[]' id='answer-id-104433' class='answer   answerof-25276 ' value='104433'   \/><label for='answer-id-104433' id='answer-label-104433' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25276[]' id='answer-id-104434' class='answer   answerof-25276 ' value='104434'   \/><label for='answer-id-104434' id='answer-label-104434' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-56' style=';'><div id='questionWrap-56'  class='   watupro-question-id-25277'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>56. <\/span>The following explanatory paragraph was included in an auditor's report to indicate a lack of consistency: &quot;As discussed in note T to the financial statements, the company changed its method of computing depreciation in X0.&quot; <br \/>\r<br>How should the auditor report on this matter if the auditor concurred with the change? Type of Location of opinion explanatory paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_56' value='25277' \/><input type='hidden' id='answerType25277' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25277[]' id='answer-id-104435' class='answer   answerof-25277 ' value='104435'   \/><label for='answer-id-104435' id='answer-label-104435' class=' answer'><span>Unqualified Before opinion paragraph<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25277[]' id='answer-id-104436' class='answer   answerof-25277 ' value='104436'   \/><label for='answer-id-104436' id='answer-label-104436' class=' answer'><span>Unqualified After opinion paragraph<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25277[]' id='answer-id-104437' class='answer   answerof-25277 ' value='104437'   \/><label for='answer-id-104437' id='answer-label-104437' class=' answer'><span>Qualified Before opinion paragraph<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25277[]' id='answer-id-104438' class='answer   answerof-25277 ' value='104438'   \/><label for='answer-id-104438' id='answer-label-104438' class=' answer'><span>Qualified After opinion paragraph<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-57' style=';'><div id='questionWrap-57'  class='   watupro-question-id-25278'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>57. <\/span>How does an auditor make the following representations when issuing the standard auditor's report on <br \/>\r<br><br><img decoding=\"async\" width=461 height=97 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image018.jpg\" v:shapes=\"_x0000_i1033\"><br><\/div><input type='hidden' name='question_id[]' id='qID_57' value='25278' \/><input type='hidden' id='answerType25278' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25278[]' id='answer-id-104439' class='answer   answerof-25278 ' value='104439'   \/><label for='answer-id-104439' id='answer-label-104439' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25278[]' id='answer-id-104440' class='answer   answerof-25278 ' value='104440'   \/><label for='answer-id-104440' id='answer-label-104440' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25278[]' id='answer-id-104441' class='answer   answerof-25278 ' value='104441'   \/><label for='answer-id-104441' id='answer-label-104441' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25278[]' id='answer-id-104442' class='answer   answerof-25278 ' value='104442'   \/><label for='answer-id-104442' id='answer-label-104442' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-58' style=';'><div id='questionWrap-58'  class='   watupro-question-id-25279'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>58. <\/span>An auditor was unable to obtain sufficient appropriate audit evidence concerning certain transactions due to an inadequacy in the entity's accounting records. <br \/>\r<br>The auditor would choose between issuing a(an):<\/div><input type='hidden' name='question_id[]' id='qID_58' value='25279' \/><input type='hidden' id='answerType25279' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25279[]' id='answer-id-104443' class='answer   answerof-25279 ' value='104443'   \/><label for='answer-id-104443' id='answer-label-104443' class=' answer'><span>Qualified opinion and an unqualified opinion with an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25279[]' id='answer-id-104444' class='answer   answerof-25279 ' value='104444'   \/><label for='answer-id-104444' id='answer-label-104444' class=' answer'><span>Unqualified opinion with an explanatory paragraph and an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25279[]' id='answer-id-104445' class='answer   answerof-25279 ' value='104445'   \/><label for='answer-id-104445' id='answer-label-104445' class=' answer'><span>Adverse opinion and a disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25279[]' id='answer-id-104446' class='answer   answerof-25279 ' value='104446'   \/><label for='answer-id-104446' id='answer-label-104446' class=' answer'><span>Disclaimer of opinion and a qualified opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-59' style=';'><div id='questionWrap-59'  class='   watupro-question-id-25280'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>59. <\/span>In which of the following situations would a principal auditor least likely make reference to another auditor who audited a subsidiary of the entity?<\/div><input type='hidden' name='question_id[]' id='qID_59' value='25280' \/><input type='hidden' id='answerType25280' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25280[]' id='answer-id-104447' class='answer   answerof-25280 ' value='104447'   \/><label for='answer-id-104447' id='answer-label-104447' class=' answer'><span>The other auditor was retained by the principal auditor and the work was performed under the principal auditor's guidance and control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25280[]' id='answer-id-104448' class='answer   answerof-25280 ' value='104448'   \/><label for='answer-id-104448' id='answer-label-104448' class=' answer'><span>The principal auditor finds it impracticable to review the other auditor's work or otherwise be satisfied as to the other auditor's work.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25280[]' id='answer-id-104449' class='answer   answerof-25280 ' value='104449'   \/><label for='answer-id-104449' id='answer-label-104449' class=' answer'><span>The financial statements audited by the other auditor are material to the consolidated financial statements covered by the principal auditor's opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25280[]' id='answer-id-104450' class='answer   answerof-25280 ' value='104450'   \/><label for='answer-id-104450' id='answer-label-104450' class=' answer'><span>The principal auditor is unable to be satisfied as to the independence and professional reputation of the other auditor.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-60' style=';'><div id='questionWrap-60'  class='   watupro-question-id-25281'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>60. <\/span>In which of the following situations would an auditor ordinarily issue an unqualified audit opinion without an explanatory paragraph?<\/div><input type='hidden' name='question_id[]' id='qID_60' value='25281' \/><input type='hidden' id='answerType25281' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25281[]' id='answer-id-104451' class='answer   answerof-25281 ' value='104451'   \/><label for='answer-id-104451' id='answer-label-104451' class=' answer'><span>The auditor wishes to emphasize that the entity had significant related party transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25281[]' id='answer-id-104452' class='answer   answerof-25281 ' value='104452'   \/><label for='answer-id-104452' id='answer-label-104452' class=' answer'><span>The auditor decides to make reference to the report of another auditor as a basis, in part, for the auditor's opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25281[]' id='answer-id-104453' class='answer   answerof-25281 ' value='104453'   \/><label for='answer-id-104453' id='answer-label-104453' class=' answer'><span>The entity issues financial statements that present financial position and results of operations, but omits the statement of cash flows.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25281[]' id='answer-id-104454' class='answer   answerof-25281 ' value='104454'   \/><label for='answer-id-104454' id='answer-label-104454' class=' answer'><span>The auditor has substantial doubt about the entity's ability to continue as a going concern, but the circumstances are fully disclosed in the financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-61' style=';'><div id='questionWrap-61'  class='   watupro-question-id-25282'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>61. <\/span>When there has been a change in accounting principle that materially affects the comparability of the comparative financial statements presented and the auditor concurs with the change, the auditor should: <br \/>\r<br><br><img decoding=\"async\" width=576 height=115 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image020.jpg\" v:shapes=\"_x0000_i1034\"><br><\/div><input type='hidden' name='question_id[]' id='qID_61' value='25282' \/><input type='hidden' id='answerType25282' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25282[]' id='answer-id-104455' class='answer   answerof-25282 ' value='104455'   \/><label for='answer-id-104455' id='answer-label-104455' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25282[]' id='answer-id-104456' class='answer   answerof-25282 ' value='104456'   \/><label for='answer-id-104456' id='answer-label-104456' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25282[]' id='answer-id-104457' class='answer   answerof-25282 ' value='104457'   \/><label for='answer-id-104457' id='answer-label-104457' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25282[]' id='answer-id-104458' class='answer   answerof-25282 ' value='104458'   \/><label for='answer-id-104458' id='answer-label-104458' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-62' style=';'><div id='questionWrap-62'  class='   watupro-question-id-25283'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>62. <\/span>When a qualified opinion results from a limitation on the scope of the audit, the situation should be described in an explanatory paragraph:<\/div><input type='hidden' name='question_id[]' id='qID_62' value='25283' \/><input type='hidden' id='answerType25283' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25283[]' id='answer-id-104459' class='answer   answerof-25283 ' value='104459'   \/><label for='answer-id-104459' id='answer-label-104459' class=' answer'><span>Preceding the opinion paragraph and referred to only in the scope paragraph of the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25283[]' id='answer-id-104460' class='answer   answerof-25283 ' value='104460'   \/><label for='answer-id-104460' id='answer-label-104460' class=' answer'><span>Following the opinion paragraph and referred to in both the scope and opinion paragraphs of the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25283[]' id='answer-id-104461' class='answer   answerof-25283 ' value='104461'   \/><label for='answer-id-104461' id='answer-label-104461' class=' answer'><span>Following the opinion paragraph and referred to only in the scope paragraph of the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25283[]' id='answer-id-104462' class='answer   answerof-25283 ' value='104462'   \/><label for='answer-id-104462' id='answer-label-104462' class=' answer'><span>Preceding the opinion paragraph and referred to in both the scope and opinion paragraphs of the auditor's report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-63' style=';'><div id='questionWrap-63'  class='   watupro-question-id-25284'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>63. <\/span>An auditor concludes that there is substantial doubt about an entity's ability to continue as a going concern for a reasonable period of time. <br \/>\r<br>If the entity's disclosures concerning this matter are adequate, the audit report may include a(an): <br \/>\r<br><br><img decoding=\"async\" width=429 height=96 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image022.jpg\" v:shapes=\"_x0000_i1035\"><br><\/div><input type='hidden' name='question_id[]' id='qID_63' value='25284' \/><input type='hidden' id='answerType25284' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25284[]' id='answer-id-104463' class='answer   answerof-25284 ' value='104463'   \/><label for='answer-id-104463' id='answer-label-104463' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25284[]' id='answer-id-104464' class='answer   answerof-25284 ' value='104464'   \/><label for='answer-id-104464' id='answer-label-104464' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25284[]' id='answer-id-104465' class='answer   answerof-25284 ' value='104465'   \/><label for='answer-id-104465' id='answer-label-104465' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25284[]' id='answer-id-104466' class='answer   answerof-25284 ' value='104466'   \/><label for='answer-id-104466' id='answer-label-104466' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-64' style=';'><div id='questionWrap-64'  class='   watupro-question-id-25285'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>64. <\/span>An auditor should disclose the substantive reasons for expressing an adverse opinion in an explanatory paragraph:<\/div><input type='hidden' name='question_id[]' id='qID_64' value='25285' \/><input type='hidden' id='answerType25285' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25285[]' id='answer-id-104467' class='answer   answerof-25285 ' value='104467'   \/><label for='answer-id-104467' id='answer-label-104467' class=' answer'><span>Preceding the scope paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25285[]' id='answer-id-104468' class='answer   answerof-25285 ' value='104468'   \/><label for='answer-id-104468' id='answer-label-104468' class=' answer'><span>Preceding the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25285[]' id='answer-id-104469' class='answer   answerof-25285 ' value='104469'   \/><label for='answer-id-104469' id='answer-label-104469' class=' answer'><span>Following the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25285[]' id='answer-id-104470' class='answer   answerof-25285 ' value='104470'   \/><label for='answer-id-104470' id='answer-label-104470' class=' answer'><span>Within the notes to the financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-65' style=';'><div id='questionWrap-65'  class='   watupro-question-id-25286'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>65. <\/span>When management does not provide reasonable justification that a change in accounting principle is preferable and it presents comparative financial statements, the auditor should express a qualified opinion:<\/div><input type='hidden' name='question_id[]' id='qID_65' value='25286' \/><input type='hidden' id='answerType25286' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25286[]' id='answer-id-104471' class='answer   answerof-25286 ' value='104471'   \/><label for='answer-id-104471' id='answer-label-104471' class=' answer'><span>Only in the year of the accounting principle change.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25286[]' id='answer-id-104472' class='answer   answerof-25286 ' value='104472'   \/><label for='answer-id-104472' id='answer-label-104472' class=' answer'><span>Each year that the financial statements initially reflecting the change are presented.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25286[]' id='answer-id-104473' class='answer   answerof-25286 ' value='104473'   \/><label for='answer-id-104473' id='answer-label-104473' class=' answer'><span>Each year until management changes back to the accounting principle formerly used.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25286[]' id='answer-id-104474' class='answer   answerof-25286 ' value='104474'   \/><label for='answer-id-104474' id='answer-label-104474' class=' answer'><span>Only if the change is to an accounting principle that is not generally accepted.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-66' style=';'><div id='questionWrap-66'  class='   watupro-question-id-25287'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>66. <\/span>When an independent CPA is associated with the financial statements of a publicly held entity but has not audited or reviewed such statements, the appropriate form of report to be issued must include a(an):<\/div><input type='hidden' name='question_id[]' id='qID_66' value='25287' \/><input type='hidden' id='answerType25287' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25287[]' id='answer-id-104475' class='answer   answerof-25287 ' value='104475'   \/><label for='answer-id-104475' id='answer-label-104475' class=' answer'><span>Compilation report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25287[]' id='answer-id-104476' class='answer   answerof-25287 ' value='104476'   \/><label for='answer-id-104476' id='answer-label-104476' class=' answer'><span>Disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25287[]' id='answer-id-104477' class='answer   answerof-25287 ' value='104477'   \/><label for='answer-id-104477' id='answer-label-104477' class=' answer'><span>Unaudited association report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25287[]' id='answer-id-104478' class='answer   answerof-25287 ' value='104478'   \/><label for='answer-id-104478' id='answer-label-104478' class=' answer'><span>Qualified opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-67' style=';'><div id='questionWrap-67'  class='   watupro-question-id-25288'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>67. <\/span>Restrictions imposed by a retail entity that is a new client prevent an auditor from observing any physical inventories. These inventories account for 40% of the entity's assets. Alternative auditing procedures cannot be applied due to the nature of the entity's records. <br \/>\r<br>Under these circumstances, the auditor should express a(an):<\/div><input type='hidden' name='question_id[]' id='qID_67' value='25288' \/><input type='hidden' id='answerType25288' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25288[]' id='answer-id-104479' class='answer   answerof-25288 ' value='104479'   \/><label for='answer-id-104479' id='answer-label-104479' class=' answer'><span>Disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25288[]' id='answer-id-104480' class='answer   answerof-25288 ' value='104480'   \/><label for='answer-id-104480' id='answer-label-104480' class=' answer'><span>Qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25288[]' id='answer-id-104481' class='answer   answerof-25288 ' value='104481'   \/><label for='answer-id-104481' id='answer-label-104481' class=' answer'><span>Adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25288[]' id='answer-id-104482' class='answer   answerof-25288 ' value='104482'   \/><label for='answer-id-104482' id='answer-label-104482' class=' answer'><span>Unqualified opinion with an explanatory paragraph.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-68' style=';'><div id='questionWrap-68'  class='   watupro-question-id-25289'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>68. <\/span>Which of the following audit procedures most likely would assist an auditor in identifying conditions and events that may indicate substantial doubt about an entity's ability to continue as a going concern?<\/div><input type='hidden' name='question_id[]' id='qID_68' value='25289' \/><input type='hidden' id='answerType25289' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25289[]' id='answer-id-104483' class='answer   answerof-25289 ' value='104483'   \/><label for='answer-id-104483' id='answer-label-104483' class=' answer'><span>Reading the minutes of meetings of the stockholders and the board of directors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25289[]' id='answer-id-104484' class='answer   answerof-25289 ' value='104484'   \/><label for='answer-id-104484' id='answer-label-104484' class=' answer'><span>Comparing the market value of property to amounts owed on the property.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25289[]' id='answer-id-104485' class='answer   answerof-25289 ' value='104485'   \/><label for='answer-id-104485' id='answer-label-104485' class=' answer'><span>Reviewing lease agreements to determine whether leased assets should be capitalized.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25289[]' id='answer-id-104486' class='answer   answerof-25289 ' value='104486'   \/><label for='answer-id-104486' id='answer-label-104486' class=' answer'><span>Inspecting title documents to verify whether any assets are pledged as collateral.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-69' style=';'><div id='questionWrap-69'  class='   watupro-question-id-25290'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>69. <\/span>Which of the following procedures most likely would assist an auditor in identifying conditions and events that may indicate substantial doubt about an entity's ability to continue as a going concern?<\/div><input type='hidden' name='question_id[]' id='qID_69' value='25290' \/><input type='hidden' id='answerType25290' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25290[]' id='answer-id-104487' class='answer   answerof-25290 ' value='104487'   \/><label for='answer-id-104487' id='answer-label-104487' class=' answer'><span>Performing cutoff tests of sales transactions with customers with long-standing receivable balances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25290[]' id='answer-id-104488' class='answer   answerof-25290 ' value='104488'   \/><label for='answer-id-104488' id='answer-label-104488' class=' answer'><span>Evaluating the entity's procedures for identifying and recording related party transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25290[]' id='answer-id-104489' class='answer   answerof-25290 ' value='104489'   \/><label for='answer-id-104489' id='answer-label-104489' class=' answer'><span>Inspecting title documents to verify whether any real property is pledged as collateral.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25290[]' id='answer-id-104490' class='answer   answerof-25290 ' value='104490'   \/><label for='answer-id-104490' id='answer-label-104490' class=' answer'><span>Inquiring of the entity's legal counsel about litigation, claims, and assessments.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-70' style=';'><div id='questionWrap-70'  class='   watupro-question-id-25291'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>70. <\/span>A CPA's standard report on audited financial statements would be inappropriate if it referred to:<\/div><input type='hidden' name='question_id[]' id='qID_70' value='25291' \/><input type='hidden' id='answerType25291' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25291[]' id='answer-id-104491' class='answer   answerof-25291 ' value='104491'   \/><label for='answer-id-104491' id='answer-label-104491' class=' answer'><span>Management's responsibility for the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25291[]' id='answer-id-104492' class='answer   answerof-25291 ' value='104492'   \/><label for='answer-id-104492' id='answer-label-104492' class=' answer'><span>An assessment of the entity's accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25291[]' id='answer-id-104493' class='answer   answerof-25291 ' value='104493'   \/><label for='answer-id-104493' id='answer-label-104493' class=' answer'><span>Significant estimates made by management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25291[]' id='answer-id-104494' class='answer   answerof-25291 ' value='104494'   \/><label for='answer-id-104494' id='answer-label-104494' class=' answer'><span>The CPA's assessment of sampling risk factors.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-71' style=';'><div id='questionWrap-71'  class='   watupro-question-id-25292'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>71. <\/span>When an auditor has substantial doubt about an entity's ability to continue as a going concern because of the probable discontinuance of operations, the auditor most likely would express a qualified opinion if:<\/div><input type='hidden' name='question_id[]' id='qID_71' value='25292' \/><input type='hidden' id='answerType25292' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25292[]' id='answer-id-104495' class='answer   answerof-25292 ' value='104495'   \/><label for='answer-id-104495' id='answer-label-104495' class=' answer'><span>The effects of the adverse financial conditions likely will cause a bankruptcy filing.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25292[]' id='answer-id-104496' class='answer   answerof-25292 ' value='104496'   \/><label for='answer-id-104496' id='answer-label-104496' class=' answer'><span>Information about the entity's ability to continue as a going concern is not disclosed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25292[]' id='answer-id-104497' class='answer   answerof-25292 ' value='104497'   \/><label for='answer-id-104497' id='answer-label-104497' class=' answer'><span>Management has no plans to reduce or delay future expenditures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25292[]' id='answer-id-104498' class='answer   answerof-25292 ' value='104498'   \/><label for='answer-id-104498' id='answer-label-104498' class=' answer'><span>Negative trends and recurring operating losses appear to be irreversible.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-72' style=';'><div id='questionWrap-72'  class='   watupro-question-id-25293'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>72. <\/span>An auditor believes that there is substantial doubt about an entity's ability to continue as a going concern for a reasonable period of time. <br \/>\r<br>In evaluating the entity's plans for dealing with the adverse effects of future conditions and events, the auditor most likely would consider, as a mitigating factor, the entity's plans to:<\/div><input type='hidden' name='question_id[]' id='qID_72' value='25293' \/><input type='hidden' id='answerType25293' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25293[]' id='answer-id-104499' class='answer   answerof-25293 ' value='104499'   \/><label for='answer-id-104499' id='answer-label-104499' class=' answer'><span>Repurchase the entity's stock at a price below its book value.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25293[]' id='answer-id-104500' class='answer   answerof-25293 ' value='104500'   \/><label for='answer-id-104500' id='answer-label-104500' class=' answer'><span>Issue stock options to key executives.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25293[]' id='answer-id-104501' class='answer   answerof-25293 ' value='104501'   \/><label for='answer-id-104501' id='answer-label-104501' class=' answer'><span>Lease rather than purchase operating facilities.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25293[]' id='answer-id-104502' class='answer   answerof-25293 ' value='104502'   \/><label for='answer-id-104502' id='answer-label-104502' class=' answer'><span>Accelerate the due date of an existing mortgage.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-73' style=';'><div id='questionWrap-73'  class='   watupro-question-id-25294'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>73. <\/span>Which of the following is true regarding the standard audit report for an issuer?<\/div><input type='hidden' name='question_id[]' id='qID_73' value='25294' \/><input type='hidden' id='answerType25294' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25294[]' id='answer-id-104503' class='answer   answerof-25294 ' value='104503'   \/><label for='answer-id-104503' id='answer-label-104503' class=' answer'><span>Reference should be made in the scope paragraph to both PCAOB standards and generally accepted auditing standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25294[]' id='answer-id-104504' class='answer   answerof-25294 ' value='104504'   \/><label for='answer-id-104504' id='answer-label-104504' class=' answer'><span>PCAOB standards should not be mentioned at all, although their use is implied in the standard auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25294[]' id='answer-id-104505' class='answer   answerof-25294 ' value='104505'   \/><label for='answer-id-104505' id='answer-label-104505' class=' answer'><span>Reference should be made in the scope paragraph to PCAOB standards, and in the opinion paragraph to generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25294[]' id='answer-id-104506' class='answer   answerof-25294 ' value='104506'   \/><label for='answer-id-104506' id='answer-label-104506' class=' answer'><span>Reference may be made in the scope paragraph to either PCAOB standards or generally accepted auditing standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-74' style=';'><div id='questionWrap-74'  class='   watupro-question-id-25295'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>74. <\/span>Under which of the following circumstances would an auditor's expression of an unqualified opinion be inappropriate?<\/div><input type='hidden' name='question_id[]' id='qID_74' value='25295' \/><input type='hidden' id='answerType25295' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25295[]' id='answer-id-104507' class='answer   answerof-25295 ' value='104507'   \/><label for='answer-id-104507' id='answer-label-104507' class=' answer'><span>The auditor is unable to obtain the audited financial statements of a significant subsidiary.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25295[]' id='answer-id-104508' class='answer   answerof-25295 ' value='104508'   \/><label for='answer-id-104508' id='answer-label-104508' class=' answer'><span>The financial statements are prepared on the entity's income tax basis.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25295[]' id='answer-id-104509' class='answer   answerof-25295 ' value='104509'   \/><label for='answer-id-104509' id='answer-label-104509' class=' answer'><span>There are significant deficiencies in the design and operation of the entity's internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25295[]' id='answer-id-104510' class='answer   answerof-25295 ' value='104510'   \/><label for='answer-id-104510' id='answer-label-104510' class=' answer'><span>Analytical procedures indicate that many year-end account balances are not comparable with the prior year's balances.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-75' style=';'><div id='questionWrap-75'  class='   watupro-question-id-25296'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>75. <\/span>Jewel, CPA, audited Infinite Co.'s prior-year financial statements. These statements are presented with those of the current year for comparative purposes without Jewel's auditor's report, which expressed a qualified opinion. <br \/>\r<br>In drafting the current year's auditor's report, Crain, CPA, the successor auditor, should: <br \/>\r<br>I. Not name Jewel as the predecessor auditor. <br \/>\r<br>II. Indicate the type of report issued by Jewel. <br \/>\r<br>III. Indicate the substantive reasons for Jewel's qualification.<\/div><input type='hidden' name='question_id[]' id='qID_75' value='25296' \/><input type='hidden' id='answerType25296' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25296[]' id='answer-id-104511' class='answer   answerof-25296 ' value='104511'   \/><label for='answer-id-104511' id='answer-label-104511' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25296[]' id='answer-id-104512' class='answer   answerof-25296 ' value='104512'   \/><label for='answer-id-104512' id='answer-label-104512' class=' answer'><span>I and II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25296[]' id='answer-id-104513' class='answer   answerof-25296 ' value='104513'   \/><label for='answer-id-104513' id='answer-label-104513' class=' answer'><span>II and III only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25296[]' id='answer-id-104514' class='answer   answerof-25296 ' value='104514'   \/><label for='answer-id-104514' id='answer-label-104514' class=' answer'><span>I, II, and II<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-76' style=';'><div id='questionWrap-76'  class='   watupro-question-id-25297'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>76. <\/span>A registration statement filed with the SEC contains the reports of two independent auditors on their audits of financial statements for different periods. <br \/>\r<br>The predecessor auditor who audited the prior-period financial statements generally should obtain a letter of representation from the:<\/div><input type='hidden' name='question_id[]' id='qID_76' value='25297' \/><input type='hidden' id='answerType25297' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25297[]' id='answer-id-104515' class='answer   answerof-25297 ' value='104515'   \/><label for='answer-id-104515' id='answer-label-104515' class=' answer'><span>Successor independent auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25297[]' id='answer-id-104516' class='answer   answerof-25297 ' value='104516'   \/><label for='answer-id-104516' id='answer-label-104516' class=' answer'><span>Client's audit committee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25297[]' id='answer-id-104517' class='answer   answerof-25297 ' value='104517'   \/><label for='answer-id-104517' id='answer-label-104517' class=' answer'><span>Principal underwriter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25297[]' id='answer-id-104518' class='answer   answerof-25297 ' value='104518'   \/><label for='answer-id-104518' id='answer-label-104518' class=' answer'><span>Securities and Exchange Commission.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-77' style=';'><div id='questionWrap-77'  class='   watupro-question-id-25298'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>77. <\/span>Before reissuing the prior year's auditor's report on the financial statements of a former client, the predecessor auditor should obtain letters of representation from the:<\/div><input type='hidden' name='question_id[]' id='qID_77' value='25298' \/><input type='hidden' id='answerType25298' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25298[]' id='answer-id-104519' class='answer   answerof-25298 ' value='104519'   \/><label for='answer-id-104519' id='answer-label-104519' class=' answer'><span>Former client's management and the board of directors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25298[]' id='answer-id-104520' class='answer   answerof-25298 ' value='104520'   \/><label for='answer-id-104520' id='answer-label-104520' class=' answer'><span>Former client's attorney and management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25298[]' id='answer-id-104521' class='answer   answerof-25298 ' value='104521'   \/><label for='answer-id-104521' id='answer-label-104521' class=' answer'><span>Former client's board of directors and the successor auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25298[]' id='answer-id-104522' class='answer   answerof-25298 ' value='104522'   \/><label for='answer-id-104522' id='answer-label-104522' class=' answer'><span>Successor auditor and the former client's management.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-78' style=';'><div id='questionWrap-78'  class='   watupro-question-id-25299'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>78. <\/span>In May X4, an auditor reissues the auditor's report on the X2 financial statements at a continuing client's request. The X2 financial statements are not restated and the auditor does not revise the wording of the report. <br \/>\r<br>The auditor should:<\/div><input type='hidden' name='question_id[]' id='qID_78' value='25299' \/><input type='hidden' id='answerType25299' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25299[]' id='answer-id-104523' class='answer   answerof-25299 ' value='104523'   \/><label for='answer-id-104523' id='answer-label-104523' class=' answer'><span>Dual date the reissued report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25299[]' id='answer-id-104524' class='answer   answerof-25299 ' value='104524'   \/><label for='answer-id-104524' id='answer-label-104524' class=' answer'><span>Use the release date of the reissued report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25299[]' id='answer-id-104525' class='answer   answerof-25299 ' value='104525'   \/><label for='answer-id-104525' id='answer-label-104525' class=' answer'><span>Use the original report date on the reissued report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25299[]' id='answer-id-104526' class='answer   answerof-25299 ' value='104526'   \/><label for='answer-id-104526' id='answer-label-104526' class=' answer'><span>Use the current-period auditor's report date on the reissued report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-79' style=';'><div id='questionWrap-79'  class='   watupro-question-id-25300'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>79. <\/span>An auditor expressed a qualified opinion on the prior year's financial statements because of a lack of adequate disclosure. These financial statements are properly restated in the current year and presented in comparative form with the current year's financial statements. <br \/>\r<br>The auditor's updated report on the prior year's financial statements should:<\/div><input type='hidden' name='question_id[]' id='qID_79' value='25300' \/><input type='hidden' id='answerType25300' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25300[]' id='answer-id-104527' class='answer   answerof-25300 ' value='104527'   \/><label for='answer-id-104527' id='answer-label-104527' class=' answer'><span>Be accompanied by the auditor's original report on the prior year's financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25300[]' id='answer-id-104528' class='answer   answerof-25300 ' value='104528'   \/><label for='answer-id-104528' id='answer-label-104528' class=' answer'><span>Continue to express a qualified opinion on the prior year's financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25300[]' id='answer-id-104529' class='answer   answerof-25300 ' value='104529'   \/><label for='answer-id-104529' id='answer-label-104529' class=' answer'><span>Make no reference to the type of opinion expressed on the prior year's financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25300[]' id='answer-id-104530' class='answer   answerof-25300 ' value='104530'   \/><label for='answer-id-104530' id='answer-label-104530' class=' answer'><span>Express an unqualified opinion on the restated financial statements of the prior year.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-80' style=';'><div id='questionWrap-80'  class='   watupro-question-id-25301'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>80. <\/span>Comparative financial statements include the financial statements of the prior year that were audited by a predecessor auditor whose report is not presented. <br \/>\r<br>If the predecessor's report was qualified, the successor should:<\/div><input type='hidden' name='question_id[]' id='qID_80' value='25301' \/><input type='hidden' id='answerType25301' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25301[]' id='answer-id-104531' class='answer   answerof-25301 ' value='104531'   \/><label for='answer-id-104531' id='answer-label-104531' class=' answer'><span>Indicate the substantive reasons for the qualification in the predecessor auditor's opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25301[]' id='answer-id-104532' class='answer   answerof-25301 ' value='104532'   \/><label for='answer-id-104532' id='answer-label-104532' class=' answer'><span>Request the client to reissue the predecessor's report on the prior year's statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25301[]' id='answer-id-104533' class='answer   answerof-25301 ' value='104533'   \/><label for='answer-id-104533' id='answer-label-104533' class=' answer'><span>Issue an updated comparative audit report indicating the division of responsibility.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25301[]' id='answer-id-104534' class='answer   answerof-25301 ' value='104534'   \/><label for='answer-id-104534' id='answer-label-104534' class=' answer'><span>Express an opinion only on the current year's statements and make no reference to the prior year's statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-81' style=';'><div id='questionWrap-81'  class='   watupro-question-id-25302'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>81. <\/span>An auditor has previously expressed a qualified opinion on the financial statements of a prior period because of a departure from generally accepted accounting principles. The prior-period financial statements are restated in the current period to conform with generally accepted accounting principles. <br \/>\r<br>The auditor's updated report on the prior-period financial statements should:<\/div><input type='hidden' name='question_id[]' id='qID_81' value='25302' \/><input type='hidden' id='answerType25302' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25302[]' id='answer-id-104535' class='answer   answerof-25302 ' value='104535'   \/><label for='answer-id-104535' id='answer-label-104535' class=' answer'><span>Express an unqualified opinion concerning the restated financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25302[]' id='answer-id-104536' class='answer   answerof-25302 ' value='104536'   \/><label for='answer-id-104536' id='answer-label-104536' class=' answer'><span>Be accompanied by the original auditor's report on the prior period.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25302[]' id='answer-id-104537' class='answer   answerof-25302 ' value='104537'   \/><label for='answer-id-104537' id='answer-label-104537' class=' answer'><span>Bear the same date as the original auditor's report on the prior period.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25302[]' id='answer-id-104538' class='answer   answerof-25302 ' value='104538'   \/><label for='answer-id-104538' id='answer-label-104538' class=' answer'><span>Qualify the opinion concerning the restated financial statements because of a change in accounting principle.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-82' style=';'><div id='questionWrap-82'  class='   watupro-question-id-25303'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>82. <\/span>Which of the following statements is not true regarding the auditor's responsibility for subsequent events?<\/div><input type='hidden' name='question_id[]' id='qID_82' value='25303' \/><input type='hidden' id='answerType25303' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25303[]' id='answer-id-104539' class='answer   answerof-25303 ' value='104539'   \/><label for='answer-id-104539' id='answer-label-104539' class=' answer'><span>The auditor has an active responsibility to make continuing inquiries between the date of the auditor's report and the date on which the report is submitted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25303[]' id='answer-id-104540' class='answer   answerof-25303 ' value='104540'   \/><label for='answer-id-104540' id='answer-label-104540' class=' answer'><span>The auditor has an active responsibility to make continuing inquiries between the date of the financial statements and the date of the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25303[]' id='answer-id-104541' class='answer   answerof-25303 ' value='104541'   \/><label for='answer-id-104541' id='answer-label-104541' class=' answer'><span>The auditor has an active responsibility to make continuing inquiries between the date of the financial statements and the date on which sufficient appropriate audit evidence has been obtained.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25303[]' id='answer-id-104542' class='answer   answerof-25303 ' value='104542'   \/><label for='answer-id-104542' id='answer-label-104542' class=' answer'><span>The auditor has no active responsibility to make continuing inquiries after the date of the auditor's report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-83' style=';'><div id='questionWrap-83'  class='   watupro-question-id-25304'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>83. <\/span>Which of the following procedures would an auditor most likely perform to obtain evidence about the occurrence of subsequent events?<\/div><input type='hidden' name='question_id[]' id='qID_83' value='25304' \/><input type='hidden' id='answerType25304' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25304[]' id='answer-id-104543' class='answer   answerof-25304 ' value='104543'   \/><label for='answer-id-104543' id='answer-label-104543' class=' answer'><span>Confirming a sample of material accounts receivable established after year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25304[]' id='answer-id-104544' class='answer   answerof-25304 ' value='104544'   \/><label for='answer-id-104544' id='answer-label-104544' class=' answer'><span>Comparing the financial statements being reported on with those of the prior period.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25304[]' id='answer-id-104545' class='answer   answerof-25304 ' value='104545'   \/><label for='answer-id-104545' id='answer-label-104545' class=' answer'><span>Investigating personnel changes in the accounting department occurring after year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25304[]' id='answer-id-104546' class='answer   answerof-25304 ' value='104546'   \/><label for='answer-id-104546' id='answer-label-104546' class=' answer'><span>Inquiring as to whether any unusual adjustments were made after year-end.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-84' style=';'><div id='questionWrap-84'  class='   watupro-question-id-25305'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>84. <\/span>Which of the following events occurring after the issuance of an auditor's report most likely would cause the auditor to make further inquiries about the previously issued financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_84' value='25305' \/><input type='hidden' id='answerType25305' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25305[]' id='answer-id-104547' class='answer   answerof-25305 ' value='104547'   \/><label for='answer-id-104547' id='answer-label-104547' class=' answer'><span>An uninsured natural disaster occurs that may affect the entity's ability to continue as a going concern.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25305[]' id='answer-id-104548' class='answer   answerof-25305 ' value='104548'   \/><label for='answer-id-104548' id='answer-label-104548' class=' answer'><span>A contingency is resolved that had been disclosed in the audited financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25305[]' id='answer-id-104549' class='answer   answerof-25305 ' value='104549'   \/><label for='answer-id-104549' id='answer-label-104549' class=' answer'><span>New information is discovered concerning undisclosed lease transactions of the audited period.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25305[]' id='answer-id-104550' class='answer   answerof-25305 ' value='104550'   \/><label for='answer-id-104550' id='answer-label-104550' class=' answer'><span>A subsidiary is sold that accounts for 25% of the entity's consolidated net income.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-85' style=';'><div id='questionWrap-85'  class='   watupro-question-id-25306'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>85. <\/span>Which of the following procedures would an auditor most likely perform in obtaining evidence about subsequent events?<\/div><input type='hidden' name='question_id[]' id='qID_85' value='25306' \/><input type='hidden' id='answerType25306' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25306[]' id='answer-id-104551' class='answer   answerof-25306 ' value='104551'   \/><label for='answer-id-104551' id='answer-label-104551' class=' answer'><span>Determine that changes in employee pay rates after year-end were properly authorized.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25306[]' id='answer-id-104552' class='answer   answerof-25306 ' value='104552'   \/><label for='answer-id-104552' id='answer-label-104552' class=' answer'><span>Recompute depreciation charges for plant assets sold after year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25306[]' id='answer-id-104553' class='answer   answerof-25306 ' value='104553'   \/><label for='answer-id-104553' id='answer-label-104553' class=' answer'><span>Inquire about payroll checks that were recorded before year-end but cashed after year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25306[]' id='answer-id-104554' class='answer   answerof-25306 ' value='104554'   \/><label for='answer-id-104554' id='answer-label-104554' class=' answer'><span>Investigate changes in long-term debt occurring after year-end.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-86' style=';'><div id='questionWrap-86'  class='   watupro-question-id-25307'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>86. <\/span>An auditor is considering whether the omission of a substantive procedure considered necessary at the time of an audit may impair the auditor's present ability to support the previously expressed opinion. <br \/>\r<br>The auditor need not apply the omitted procedure if the:<\/div><input type='hidden' name='question_id[]' id='qID_86' value='25307' \/><input type='hidden' id='answerType25307' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25307[]' id='answer-id-104555' class='answer   answerof-25307 ' value='104555'   \/><label for='answer-id-104555' id='answer-label-104555' class=' answer'><span>Financial statements and auditor's report were not distributed beyond management and the board of directors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25307[]' id='answer-id-104556' class='answer   answerof-25307 ' value='104556'   \/><label for='answer-id-104556' id='answer-label-104556' class=' answer'><span>Auditor's previously expressed opinion was qualified because of a departure from GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25307[]' id='answer-id-104557' class='answer   answerof-25307 ' value='104557'   \/><label for='answer-id-104557' id='answer-label-104557' class=' answer'><span>Results of other procedures that were applied tend to compensate for the procedure omitted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25307[]' id='answer-id-104558' class='answer   answerof-25307 ' value='104558'   \/><label for='answer-id-104558' id='answer-label-104558' class=' answer'><span>Omission is due to unreasonable delays by client personnel in providing data on a timely basis.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-87' style=';'><div id='questionWrap-87'  class='   watupro-question-id-25308'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>87. <\/span>Subsequent to the issuance of an auditor's report, the auditor became aware of facts existing at the report date that would have affected the report had the auditor then been aware of such facts. <br \/>\r<br>After determining that the information is reliable, the auditor should next:<\/div><input type='hidden' name='question_id[]' id='qID_87' value='25308' \/><input type='hidden' id='answerType25308' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25308[]' id='answer-id-104559' class='answer   answerof-25308 ' value='104559'   \/><label for='answer-id-104559' id='answer-label-104559' class=' answer'><span>Determine whether there are persons relying or likely to rely on the financial statements who would attach importance to the information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25308[]' id='answer-id-104560' class='answer   answerof-25308 ' value='104560'   \/><label for='answer-id-104560' id='answer-label-104560' class=' answer'><span>Request that management disclose the newly discovered information by issuing revised financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25308[]' id='answer-id-104561' class='answer   answerof-25308 ' value='104561'   \/><label for='answer-id-104561' id='answer-label-104561' class=' answer'><span>Issue revised pro forma financial statements taking into consideration the newly discovered information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25308[]' id='answer-id-104562' class='answer   answerof-25308 ' value='104562'   \/><label for='answer-id-104562' id='answer-label-104562' class=' answer'><span>Give public notice that the auditor is no longer associated with financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-88' style=';'><div id='questionWrap-88'  class='   watupro-question-id-25309'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>88. <\/span>On March 15, X4, Kent, CPA, issued an unqualified opinion on a client's audited financial statements for the year ended December 31, X3. On May 4, X4, Kent's internal inspection program disclosed that engagement personnel failed to observe the client's physical inventory. Omission of this procedure impairs Kent's present ability to support the unqualified opinion. <br \/>\r<br>If the stockholders are currently relying on the opinion, Kent should first:<\/div><input type='hidden' name='question_id[]' id='qID_88' value='25309' \/><input type='hidden' id='answerType25309' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25309[]' id='answer-id-104563' class='answer   answerof-25309 ' value='104563'   \/><label for='answer-id-104563' id='answer-label-104563' class=' answer'><span>Advise management to disclose to the stockholders that Kent's unqualified opinion should not be relied on.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25309[]' id='answer-id-104564' class='answer   answerof-25309 ' value='104564'   \/><label for='answer-id-104564' id='answer-label-104564' class=' answer'><span>Undertake to apply alternative procedures that would provide a satisfactory basis for the unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25309[]' id='answer-id-104565' class='answer   answerof-25309 ' value='104565'   \/><label for='answer-id-104565' id='answer-label-104565' class=' answer'><span>Reissue the auditor's report and add an explanatory paragraph describing the departure from generally accepted auditing standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25309[]' id='answer-id-104566' class='answer   answerof-25309 ' value='104566'   \/><label for='answer-id-104566' id='answer-label-104566' class=' answer'><span>Compensate for the omitted procedure by performing tests of controls to reduce audit risk to a sufficiently low level.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-89' style=';'><div id='questionWrap-89'  class='   watupro-question-id-25310'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>89. <\/span>Which of the following events occurring after the issuance of an auditor's report most likely would cause the auditor to make further inquiries about the previously issued financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_89' value='25310' \/><input type='hidden' id='answerType25310' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25310[]' id='answer-id-104567' class='answer   answerof-25310 ' value='104567'   \/><label for='answer-id-104567' id='answer-label-104567' class=' answer'><span>A technological development that could affect the entity's future ability to continue as a going concern.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25310[]' id='answer-id-104568' class='answer   answerof-25310 ' value='104568'   \/><label for='answer-id-104568' id='answer-label-104568' class=' answer'><span>The discovery of information regarding a contingency that existed before the financial statements were issued.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25310[]' id='answer-id-104569' class='answer   answerof-25310 ' value='104569'   \/><label for='answer-id-104569' id='answer-label-104569' class=' answer'><span>The entity's sale of a subsidiary that accounts for 30% of the entity's consolidated sales.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25310[]' id='answer-id-104570' class='answer   answerof-25310 ' value='104570'   \/><label for='answer-id-104570' id='answer-label-104570' class=' answer'><span>The final resolution of a lawsuit explained in a separate paragraph of the auditor's report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-90' style=';'><div id='questionWrap-90'  class='   watupro-question-id-25311'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>90. <\/span>Wilson, CPA, obtained sufficient appropriate audit evidence to render an opinion on Abco's December 31, X1, financial statements on March 6, X2. A subsequent event requiring adjustment to the X1 financial statements occurred on April 10, X2, and came to Wilson's attention on April 24, X2. <br \/>\r<br>If the adjustment is made without disclosure of the event, Wilson's report ordinarily should be dated:<\/div><input type='hidden' name='question_id[]' id='qID_90' value='25311' \/><input type='hidden' id='answerType25311' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25311[]' id='answer-id-104571' class='answer   answerof-25311 ' value='104571'   \/><label for='answer-id-104571' id='answer-label-104571' class=' answer'><span>March 6, X2.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25311[]' id='answer-id-104572' class='answer   answerof-25311 ' value='104572'   \/><label for='answer-id-104572' id='answer-label-104572' class=' answer'><span>April 10, X2.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25311[]' id='answer-id-104573' class='answer   answerof-25311 ' value='104573'   \/><label for='answer-id-104573' id='answer-label-104573' class=' answer'><span>April 24, X2.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25311[]' id='answer-id-104574' class='answer   answerof-25311 ' value='104574'   \/><label for='answer-id-104574' id='answer-label-104574' class=' answer'><span>Using dual dating.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-91' style=';'><div id='questionWrap-91'  class='   watupro-question-id-25312'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>91. <\/span>An auditor concludes that a substantive auditing procedure considered necessary during the prior period's audit was omitted. <br \/>\r<br>Which of the following factors would most likely cause the auditor promptly to apply the omitted procedure?<\/div><input type='hidden' name='question_id[]' id='qID_91' value='25312' \/><input type='hidden' id='answerType25312' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25312[]' id='answer-id-104575' class='answer   answerof-25312 ' value='104575'   \/><label for='answer-id-104575' id='answer-label-104575' class=' answer'><span>There are no alternative procedures available to provide the same evidence as the omitted procedure.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25312[]' id='answer-id-104576' class='answer   answerof-25312 ' value='104576'   \/><label for='answer-id-104576' id='answer-label-104576' class=' answer'><span>The omission of the procedure impairs the auditor's present ability to support the previously expressed opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25312[]' id='answer-id-104577' class='answer   answerof-25312 ' value='104577'   \/><label for='answer-id-104577' id='answer-label-104577' class=' answer'><span>The source documents needed to perform the omitted procedure are still available.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25312[]' id='answer-id-104578' class='answer   answerof-25312 ' value='104578'   \/><label for='answer-id-104578' id='answer-label-104578' class=' answer'><span>The auditor's opinion on the prior period's financial statements was unqualified.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-92' style=';'><div id='questionWrap-92'  class='   watupro-question-id-25313'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>92. <\/span>After issuing a report, an auditor has no obligation to make continuing inquiries or perform other procedures concerning the audited financial statements, unless:<\/div><input type='hidden' name='question_id[]' id='qID_92' value='25313' \/><input type='hidden' id='answerType25313' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25313[]' id='answer-id-104579' class='answer   answerof-25313 ' value='104579'   \/><label for='answer-id-104579' id='answer-label-104579' class=' answer'><span>Information, which existed at the report date and may affect the report, comes to the auditor's attention.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25313[]' id='answer-id-104580' class='answer   answerof-25313 ' value='104580'   \/><label for='answer-id-104580' id='answer-label-104580' class=' answer'><span>Management of the entity requests the auditor to reissue the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25313[]' id='answer-id-104581' class='answer   answerof-25313 ' value='104581'   \/><label for='answer-id-104581' id='answer-label-104581' class=' answer'><span>Information about an event that occurred after the date of the auditor's report comes to the auditor's attention.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25313[]' id='answer-id-104582' class='answer   answerof-25313 ' value='104582'   \/><label for='answer-id-104582' id='answer-label-104582' class=' answer'><span>Final determinations or resolutions are made of contingencies that had been disclosed in the financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-93' style=';'><div id='questionWrap-93'  class='   watupro-question-id-25314'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>93. <\/span>Which of the following procedures would an auditor most likely perform in obtaining evidence about subsequent events?<\/div><input type='hidden' name='question_id[]' id='qID_93' value='25314' \/><input type='hidden' id='answerType25314' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25314[]' id='answer-id-104583' class='answer   answerof-25314 ' value='104583'   \/><label for='answer-id-104583' id='answer-label-104583' class=' answer'><span>Examine a sample of transactions that occurred since the year-end to verify the effectiveness of computer controls.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25314[]' id='answer-id-104584' class='answer   answerof-25314 ' value='104584'   \/><label for='answer-id-104584' id='answer-label-104584' class=' answer'><span>Inquire of management whether there have been significant changes in working capital since the year&shy;end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25314[]' id='answer-id-104585' class='answer   answerof-25314 ' value='104585'   \/><label for='answer-id-104585' id='answer-label-104585' class=' answer'><span>Recompute depreciation charges for plant assets sold for substantial gains since the year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25314[]' id='answer-id-104586' class='answer   answerof-25314 ' value='104586'   \/><label for='answer-id-104586' id='answer-label-104586' class=' answer'><span>Reperform the tests of controls that indicated significant deficiencies in the operation of internal control.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-94' style=';'><div id='questionWrap-94'  class='   watupro-question-id-25315'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>94. <\/span>Which of the following events occurring after the issuance of an auditor's report most likely would cause the auditor to make further inquiries about the previously issued financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_94' value='25315' \/><input type='hidden' id='answerType25315' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25315[]' id='answer-id-104587' class='answer   answerof-25315 ' value='104587'   \/><label for='answer-id-104587' id='answer-label-104587' class=' answer'><span>A lawsuit is resolved that is explained in a separate paragraph of the prior-year's auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25315[]' id='answer-id-104588' class='answer   answerof-25315 ' value='104588'   \/><label for='answer-id-104588' id='answer-label-104588' class=' answer'><span>New information is discovered concerning undisclosed related party transactions of the prior year.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25315[]' id='answer-id-104589' class='answer   answerof-25315 ' value='104589'   \/><label for='answer-id-104589' id='answer-label-104589' class=' answer'><span>A technological development occurs that affects the entity's ability to continue as a going concern.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25315[]' id='answer-id-104590' class='answer   answerof-25315 ' value='104590'   \/><label for='answer-id-104590' id='answer-label-104590' class=' answer'><span>The entity sells a subsidiary that accounts for 35% of the entity's consolidated sales.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-95' style=';'><div id='questionWrap-95'  class='   watupro-question-id-25316'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>95. <\/span>On February 9, Brown, CPA, expressed an unqualified opinion on the financial statements of Web Co. <br \/>\r<br>On October 9, during a peer review of Brown's practice, the reviewer informed Brown that engagement personnel failed to perform a search for subsequent events for the Web engagement. Brown should first:<\/div><input type='hidden' name='question_id[]' id='qID_95' value='25316' \/><input type='hidden' id='answerType25316' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25316[]' id='answer-id-104591' class='answer   answerof-25316 ' value='104591'   \/><label for='answer-id-104591' id='answer-label-104591' class=' answer'><span>Request Web's permission to perform substantive procedures that would provide a satisfactory basis for the opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25316[]' id='answer-id-104592' class='answer   answerof-25316 ' value='104592'   \/><label for='answer-id-104592' id='answer-label-104592' class=' answer'><span>Inquire of Web whether there are persons currently relying, or likely to rely, on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25316[]' id='answer-id-104593' class='answer   answerof-25316 ' value='104593'   \/><label for='answer-id-104593' id='answer-label-104593' class=' answer'><span>Take no additional action because subsequent events have no effect on the financial statements that were reported on.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25316[]' id='answer-id-104594' class='answer   answerof-25316 ' value='104594'   \/><label for='answer-id-104594' id='answer-label-104594' class=' answer'><span>Assess the importance of the omitted procedures to Brown's present ability to support the opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-96' style=';'><div id='questionWrap-96'  class='   watupro-question-id-25317'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>96. <\/span>Which of the following is not true regarding an engagement to provide a written report on the application of accounting principles?<\/div><input type='hidden' name='question_id[]' id='qID_96' value='25317' \/><input type='hidden' id='answerType25317' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25317[]' id='answer-id-104595' class='answer   answerof-25317 ' value='104595'   \/><label for='answer-id-104595' id='answer-label-104595' class=' answer'><span>An accountant is prohibited from providing a report on the application of accounting principles to a transaction not involving the facts and circumstances of a specific entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25317[]' id='answer-id-104596' class='answer   answerof-25317 ' value='104596'   \/><label for='answer-id-104596' id='answer-label-104596' class=' answer'><span>The accountant's written report on the application of accounting principles should include an identification of the specific entity involved.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25317[]' id='answer-id-104597' class='answer   answerof-25317 ' value='104597'   \/><label for='answer-id-104597' id='answer-label-104597' class=' answer'><span>An accountant is prohibited from providing a report on the application of accounting principles to a proposed future transaction involving the facts and circumstances of a specific entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25317[]' id='answer-id-104598' class='answer   answerof-25317 ' value='104598'   \/><label for='answer-id-104598' id='answer-label-104598' class=' answer'><span>The accountant's written report on the application of accounting principles should include a paragraph restricting the use of the report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-97' style=';'><div id='questionWrap-97'  class='   watupro-question-id-25318'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>97. <\/span>Before reporting on the financial statements of a U.S. entity that have been prepared in conformity with another country's accounting principles, an auditor practicing in the U.S. should:<\/div><input type='hidden' name='question_id[]' id='qID_97' value='25318' \/><input type='hidden' id='answerType25318' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25318[]' id='answer-id-104599' class='answer   answerof-25318 ' value='104599'   \/><label for='answer-id-104599' id='answer-label-104599' class=' answer'><span>Understand the accounting principles generally accepted in the other country.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25318[]' id='answer-id-104600' class='answer   answerof-25318 ' value='104600'   \/><label for='answer-id-104600' id='answer-label-104600' class=' answer'><span>Be certified by the appropriate auditing or accountancy board of the other country.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25318[]' id='answer-id-104601' class='answer   answerof-25318 ' value='104601'   \/><label for='answer-id-104601' id='answer-label-104601' class=' answer'><span>Notify management that the auditor is required to disclaim an opinion on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25318[]' id='answer-id-104602' class='answer   answerof-25318 ' value='104602'   \/><label for='answer-id-104602' id='answer-label-104602' class=' answer'><span>Receive a waiver from the auditor's state board of accountancy to perform the engagement.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-98' style=';'><div id='questionWrap-98'  class='   watupro-question-id-25319'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>98. <\/span>In connection with a proposal to obtain a new client, an accountant in public practice is asked to prepare a written report on the application of accounting principles to a specific transaction. <br \/>\r<br>The accountant's report should include a statement that:<\/div><input type='hidden' name='question_id[]' id='qID_98' value='25319' \/><input type='hidden' id='answerType25319' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25319[]' id='answer-id-104603' class='answer   answerof-25319 ' value='104603'   \/><label for='answer-id-104603' id='answer-label-104603' class=' answer'><span>Any difference in the facts, circumstances, or assumptions presented may change the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25319[]' id='answer-id-104604' class='answer   answerof-25319 ' value='104604'   \/><label for='answer-id-104604' id='answer-label-104604' class=' answer'><span>The engagement was performed in accordance with Statements on Standards for Consulting Services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25319[]' id='answer-id-104605' class='answer   answerof-25319 ' value='104605'   \/><label for='answer-id-104605' id='answer-label-104605' class=' answer'><span>The guidance provided is for management use only and may not be communicated to the prior or continuing auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25319[]' id='answer-id-104606' class='answer   answerof-25319 ' value='104606'   \/><label for='answer-id-104606' id='answer-label-104606' class=' answer'><span>Nothing came to the accountant's attention that caused the accountant to believe that the accounting principles violated GAA<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-99' style=';'><div id='questionWrap-99'  class='   watupro-question-id-25320'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>99. <\/span>Blue, CPA, has been asked to render an opinion on the application of accounting principles to a specific transaction by an entity that is audited by another CPA.<br \/>\r\n<br \/>\r\nBlue may accept this engagement, but should:<\/div><input type='hidden' name='question_id[]' id='qID_99' value='25320' \/><input type='hidden' id='answerType25320' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25320[]' id='answer-id-104607' class='answer   answerof-25320 ' value='104607'   \/><label for='answer-id-104607' id='answer-label-104607' class=' answer'><span>Consult with the continuing CPA to obtain information relevant to the transaction.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25320[]' id='answer-id-104608' class='answer   answerof-25320 ' value='104608'   \/><label for='answer-id-104608' id='answer-label-104608' class=' answer'><span>Report the engagement's findings to the entity's audit committee, the continuing CPA, and management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25320[]' id='answer-id-104609' class='answer   answerof-25320 ' value='104609'   \/><label for='answer-id-104609' id='answer-label-104609' class=' answer'><span>Disclaim any opinion that the hypothetical application of accounting principles conforms with generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25320[]' id='answer-id-104610' class='answer   answerof-25320 ' value='104610'   \/><label for='answer-id-104610' id='answer-label-104610' class=' answer'><span>Notify the entity that the report is for the general use of all interested parties.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-100' style=';'><div id='questionWrap-100'  class='   watupro-question-id-25321'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>100. <\/span>The financial statements of KCP America, a U.S. entity, are prepared for inclusion in the consolidated financial statements of its non-U.S. parent. These financial statements are prepared in conformity with the accounting principles generally accepted in the parent's country and are for use only in that country. <br \/>\r<br>How may KCP America's auditor report on these financial statements? <br \/>\r<br>I. A U.S.-style report (unmodified). <br \/>\r<br>II. A U.S.-style report modified to report on the accounting principles of the parent's country. <br \/>\r<br>III. The report form of the parent's country. <br \/>\r<br><br><img decoding=\"async\" width=171 height=95 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image024.jpg\" v:shapes=\"_x0000_i1036\"><br><\/div><input type='hidden' name='question_id[]' id='qID_100' value='25321' \/><input type='hidden' id='answerType25321' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25321[]' id='answer-id-104611' class='answer   answerof-25321 ' value='104611'   \/><label for='answer-id-104611' id='answer-label-104611' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25321[]' id='answer-id-104612' class='answer   answerof-25321 ' value='104612'   \/><label for='answer-id-104612' id='answer-label-104612' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25321[]' id='answer-id-104613' class='answer   answerof-25321 ' value='104613'   \/><label for='answer-id-104613' id='answer-label-104613' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25321[]' id='answer-id-104614' class='answer   answerof-25321 ' value='104614'   \/><label for='answer-id-104614' id='answer-label-104614' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-101' style=';'><div id='questionWrap-101'  class='   watupro-question-id-25322'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>101. <\/span>Which of the following is true regarding the auditor's responsibility to report on information accompanying the basic financial statements in a client-prepared document?<\/div><input type='hidden' name='question_id[]' id='qID_101' value='25322' \/><input type='hidden' id='answerType25322' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25322[]' id='answer-id-104615' class='answer   answerof-25322 ' value='104615'   \/><label for='answer-id-104615' id='answer-label-104615' class=' answer'><span>The auditor may report on information accompanying the basic financial statements in a client prepared document only if he or she has been specifically engaged to do so.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25322[]' id='answer-id-104616' class='answer   answerof-25322 ' value='104616'   \/><label for='answer-id-104616' id='answer-label-104616' class=' answer'><span>The auditor is required to express an opinion on whether information accompanying the basic financial statements in a client-prepared document is fairly stated in all material respects in relation to the financial statements taken as a whole.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25322[]' id='answer-id-104617' class='answer   answerof-25322 ' value='104617'   \/><label for='answer-id-104617' id='answer-label-104617' class=' answer'><span>If an auditor chooses to report on information accompanying the basic financial statements in a client prepared document, the report should include a description of the character of the audit work performed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25322[]' id='answer-id-104618' class='answer   answerof-25322 ' value='104618'   \/><label for='answer-id-104618' id='answer-label-104618' class=' answer'><span>If an auditor chooses to report on information accompanying the basic financial statements in a client prepared document, the report should include an opinion on the information but should not describe the character of the audit work performed.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-102' style=';'><div id='questionWrap-102'  class='   watupro-question-id-25323'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>102. <\/span>Which of the following reporting options is least likely with regard to supplementary information that is required by GAAP?<\/div><input type='hidden' name='question_id[]' id='qID_102' value='25323' \/><input type='hidden' id='answerType25323' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25323[]' id='answer-id-104619' class='answer   answerof-25323 ' value='104619'   \/><label for='answer-id-104619' id='answer-label-104619' class=' answer'><span>The auditor's report on the financial statements makes no reference to the supplementary information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25323[]' id='answer-id-104620' class='answer   answerof-25323 ' value='104620'   \/><label for='answer-id-104620' id='answer-label-104620' class=' answer'><span>A disclaimer of opinion is issued on supplementary information that is not clearly distinguished from the financial statements and is not marked &quot;unaudited.&quot;<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25323[]' id='answer-id-104621' class='answer   answerof-25323 ' value='104621'   \/><label for='answer-id-104621' id='answer-label-104621' class=' answer'><span>The auditor's report on the financial statements includes both an opinion on the supplementary information and a statement restricting the use of the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25323[]' id='answer-id-104622' class='answer   answerof-25323 ' value='104622'   \/><label for='answer-id-104622' id='answer-label-104622' class=' answer'><span>The auditor's report on the financial statements includes an opinion regarding whether the supplementary information is fairly stated in all material respects in relation to the financial statements taken as a whole.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-103' style=';'><div id='questionWrap-103'  class='   watupro-question-id-25324'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>103. <\/span>When an auditor submits a document containing audited financial statements to a client, and those financial statements include supplementary information required by GAAP, the auditor may choose any of the following options, except:<\/div><input type='hidden' name='question_id[]' id='qID_103' value='25324' \/><input type='hidden' id='answerType25324' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25324[]' id='answer-id-104623' class='answer   answerof-25324 ' value='104623'   \/><label for='answer-id-104623' id='answer-label-104623' class=' answer'><span>Express an opinion on the information, if he or she has been engaged to examine such information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25324[]' id='answer-id-104624' class='answer   answerof-25324 ' value='104624'   \/><label for='answer-id-104624' id='answer-label-104624' class=' answer'><span>Express negative assurance on the information, if review procedures have been appropriately performed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25324[]' id='answer-id-104625' class='answer   answerof-25324 ' value='104625'   \/><label for='answer-id-104625' id='answer-label-104625' class=' answer'><span>Report on whether the information is fairly stated in relation to the financial statements taken as a whole, if appropriate auditing procedures have been applied.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25324[]' id='answer-id-104626' class='answer   answerof-25324 ' value='104626'   \/><label for='answer-id-104626' id='answer-label-104626' class=' answer'><span>Disclaim an opinion on the information.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-104' style=';'><div id='questionWrap-104'  class='   watupro-question-id-25325'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>104. <\/span>An auditor may report on condensed financial statements that are derived from complete financial statements if the:<\/div><input type='hidden' name='question_id[]' id='qID_104' value='25325' \/><input type='hidden' id='answerType25325' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25325[]' id='answer-id-104627' class='answer   answerof-25325 ' value='104627'   \/><label for='answer-id-104627' id='answer-label-104627' class=' answer'><span>Condensed financial statements are distributed to stockholders along with the complete financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25325[]' id='answer-id-104628' class='answer   answerof-25325 ' value='104628'   \/><label for='answer-id-104628' id='answer-label-104628' class=' answer'><span>Auditor describes the additional procedures performed on the condensed financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25325[]' id='answer-id-104629' class='answer   answerof-25325 ' value='104629'   \/><label for='answer-id-104629' id='answer-label-104629' class=' answer'><span>Auditor indicates whether the information in the condensed financial statements is fairly stated in all \r\nmaterial respects in relation to the complete financial statements from which it has been derived.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25325[]' id='answer-id-104630' class='answer   answerof-25325 ' value='104630'   \/><label for='answer-id-104630' id='answer-label-104630' class=' answer'><span>Condensed financial statements are presented in comparative form with the prior year's condensed financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-105' style=';'><div id='questionWrap-105'  class='   watupro-question-id-25326'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>105. <\/span>An auditor is engaged to report on selected financial data that are included in a client-prepared document containing audited financial statements. <br \/>\r<br>Under these circumstances, the report on the selected data should:<\/div><input type='hidden' name='question_id[]' id='qID_105' value='25326' \/><input type='hidden' id='answerType25326' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25326[]' id='answer-id-104631' class='answer   answerof-25326 ' value='104631'   \/><label for='answer-id-104631' id='answer-label-104631' class=' answer'><span>Be limited to data derived from the audited financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25326[]' id='answer-id-104632' class='answer   answerof-25326 ' value='104632'   \/><label for='answer-id-104632' id='answer-label-104632' class=' answer'><span>Be distributed only to senior management and the board of directors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25326[]' id='answer-id-104633' class='answer   answerof-25326 ' value='104633'   \/><label for='answer-id-104633' id='answer-label-104633' class=' answer'><span>State that the presentation is a comprehensive basis of accounting other than GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25326[]' id='answer-id-104634' class='answer   answerof-25326 ' value='104634'   \/><label for='answer-id-104634' id='answer-label-104634' class=' answer'><span>Indicate that the data are not fairly stated in all material respects.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-106' style=';'><div id='questionWrap-106'  class='   watupro-question-id-25327'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>106. <\/span>If information accompanying the basic financial statements in an auditor-submitted document has been subjected to auditing procedures, the auditor may include in the auditor's report on the financial statements an opinion that the accompanying information is fairly stated in:<\/div><input type='hidden' name='question_id[]' id='qID_106' value='25327' \/><input type='hidden' id='answerType25327' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25327[]' id='answer-id-104635' class='answer   answerof-25327 ' value='104635'   \/><label for='answer-id-104635' id='answer-label-104635' class=' answer'><span>Accordance with generally accepted auditing standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25327[]' id='answer-id-104636' class='answer   answerof-25327 ' value='104636'   \/><label for='answer-id-104636' id='answer-label-104636' class=' answer'><span>Conformity with generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25327[]' id='answer-id-104637' class='answer   answerof-25327 ' value='104637'   \/><label for='answer-id-104637' id='answer-label-104637' class=' answer'><span>All material respects in relation to the basic financial statements taken as a whole.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25327[]' id='answer-id-104638' class='answer   answerof-25327 ' value='104638'   \/><label for='answer-id-104638' id='answer-label-104638' class=' answer'><span>Accordance with attestation standards expressing a conclusion about management's assertions.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-107' style=';'><div id='questionWrap-107'  class='   watupro-question-id-25328'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>107. <\/span>An auditor concludes that there is a material inconsistency in the other information in an annual report to shareholders containing audited financial statements. The auditor believes that the financial statements do not require revision, but the client is unwilling to revise or eliminate the material inconsistency in the other information. <br \/>\r<br>Under these circumstances, what action would the auditor most likely take?<\/div><input type='hidden' name='question_id[]' id='qID_107' value='25328' \/><input type='hidden' id='answerType25328' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25328[]' id='answer-id-104639' class='answer   answerof-25328 ' value='104639'   \/><label for='answer-id-104639' id='answer-label-104639' class=' answer'><span>Consider the situation closed because the other information is not in the audited financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25328[]' id='answer-id-104640' class='answer   answerof-25328 ' value='104640'   \/><label for='answer-id-104640' id='answer-label-104640' class=' answer'><span>Issue an &quot;except for&quot; qualified opinion after discussing the matter with the client's audit committee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25328[]' id='answer-id-104641' class='answer   answerof-25328 ' value='104641'   \/><label for='answer-id-104641' id='answer-label-104641' class=' answer'><span>Disclaim an opinion on the financial statements after explaining the material inconsistency in a separate explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25328[]' id='answer-id-104642' class='answer   answerof-25328 ' value='104642'   \/><label for='answer-id-104642' id='answer-label-104642' class=' answer'><span>Revise the auditor's report to include a separate explanatory paragraph describing the material inconsistency.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-108' style=';'><div id='questionWrap-108'  class='   watupro-question-id-25329'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>108. <\/span>In the standard report on condensed financial statements that are derived from a public entity's audited financial statements, a CPA should indicate that the:<\/div><input type='hidden' name='question_id[]' id='qID_108' value='25329' \/><input type='hidden' id='answerType25329' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25329[]' id='answer-id-104643' class='answer   answerof-25329 ' value='104643'   \/><label for='answer-id-104643' id='answer-label-104643' class=' answer'><span>Condensed financial statements are prepared in conformity with another comprehensive basis of accounting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25329[]' id='answer-id-104644' class='answer   answerof-25329 ' value='104644'   \/><label for='answer-id-104644' id='answer-label-104644' class=' answer'><span>CPA has audited and expressed an opinion on the complete financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25329[]' id='answer-id-104645' class='answer   answerof-25329 ' value='104645'   \/><label for='answer-id-104645' id='answer-label-104645' class=' answer'><span>Condensed financial statements are not fairly presented in all material respects.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25329[]' id='answer-id-104646' class='answer   answerof-25329 ' value='104646'   \/><label for='answer-id-104646' id='answer-label-104646' class=' answer'><span>CPA expresses limited assurance that the financial statements conform with GAA<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-109' style=';'><div id='questionWrap-109'  class='   watupro-question-id-25330'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>109. <\/span>Investment and property schedules are presented for purposes of additional analysis in an auditor submitted document. The schedules are not required parts of the basic financial statements, but accompany the basic financial statements. <br \/>\r<br>When reporting on such additional information, the measurement of materiality is the:<\/div><input type='hidden' name='question_id[]' id='qID_109' value='25330' \/><input type='hidden' id='answerType25330' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25330[]' id='answer-id-104647' class='answer   answerof-25330 ' value='104647'   \/><label for='answer-id-104647' id='answer-label-104647' class=' answer'><span>Same as that used in forming an opinion on the basic financial statements taken as a whole.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25330[]' id='answer-id-104648' class='answer   answerof-25330 ' value='104648'   \/><label for='answer-id-104648' id='answer-label-104648' class=' answer'><span>Lesser of the individual schedule of investments or schedule of property taken by itself.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25330[]' id='answer-id-104649' class='answer   answerof-25330 ' value='104649'   \/><label for='answer-id-104649' id='answer-label-104649' class=' answer'><span>Greater of the individual schedule of investments or schedule of property taken by itself.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25330[]' id='answer-id-104650' class='answer   answerof-25330 ' value='104650'   \/><label for='answer-id-104650' id='answer-label-104650' class=' answer'><span>Combined total of both the individual schedules of investments and property taken as a whole.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-110' style=';'><div id='questionWrap-110'  class='   watupro-question-id-25331'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>110. <\/span>What is an auditor's responsibility for supplementary information which is outside the basic financial statements, but required by the FASB?<\/div><input type='hidden' name='question_id[]' id='qID_110' value='25331' \/><input type='hidden' id='answerType25331' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25331[]' id='answer-id-104651' class='answer   answerof-25331 ' value='104651'   \/><label for='answer-id-104651' id='answer-label-104651' class=' answer'><span>The auditor has no responsibility for required supplementary information as long as it is outside the basic financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25331[]' id='answer-id-104652' class='answer   answerof-25331 ' value='104652'   \/><label for='answer-id-104652' id='answer-label-104652' class=' answer'><span>The auditor's only responsibility for required supplementary information is to determine that such information has not been omitted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25331[]' id='answer-id-104653' class='answer   answerof-25331 ' value='104653'   \/><label for='answer-id-104653' id='answer-label-104653' class=' answer'><span>The auditor should apply certain limited procedures to the required supplementary information, and report deficiencies in, or omissions of, such information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25331[]' id='answer-id-104654' class='answer   answerof-25331 ' value='104654'   \/><label for='answer-id-104654' id='answer-label-104654' class=' answer'><span>The auditor should apply tests of details of transactions and balances to the required supplementary information, and report any material misstatements in such information.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-111' style=';'><div id='questionWrap-111'  class='   watupro-question-id-25332'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>111. <\/span>Which of the following best describes the auditor's reporting responsibility concerning information accompanying the basic financial statements in an auditor-submitted document?<\/div><input type='hidden' name='question_id[]' id='qID_111' value='25332' \/><input type='hidden' id='answerType25332' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25332[]' id='answer-id-104655' class='answer   answerof-25332 ' value='104655'   \/><label for='answer-id-104655' id='answer-label-104655' class=' answer'><span>The auditor has no reporting responsibility concerning information accompanying the basic financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25332[]' id='answer-id-104656' class='answer   answerof-25332 ' value='104656'   \/><label for='answer-id-104656' id='answer-label-104656' class=' answer'><span>The auditor should report on the information accompanying the basic financial statements only if the auditor participated in its preparation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25332[]' id='answer-id-104657' class='answer   answerof-25332 ' value='104657'   \/><label for='answer-id-104657' id='answer-label-104657' class=' answer'><span>The auditor should report on the information accompanying the basic financial statements only if the auditor did not participate in its preparation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25332[]' id='answer-id-104658' class='answer   answerof-25332 ' value='104658'   \/><label for='answer-id-104658' id='answer-label-104658' class=' answer'><span>The auditor should report on all the information included in the document.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-112' style=';'><div id='questionWrap-112'  class='   watupro-question-id-25333'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>112. <\/span>When audited financial statements are presented in a client's document containing other information, the auditor should:<\/div><input type='hidden' name='question_id[]' id='qID_112' value='25333' \/><input type='hidden' id='answerType25333' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25333[]' id='answer-id-104659' class='answer   answerof-25333 ' value='104659'   \/><label for='answer-id-104659' id='answer-label-104659' class=' answer'><span>Perform inquiry and analytical procedures to ascertain whether the other information is reasonable.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25333[]' id='answer-id-104660' class='answer   answerof-25333 ' value='104660'   \/><label for='answer-id-104660' id='answer-label-104660' class=' answer'><span>Add an explanatory paragraph to the auditor\u2019s report without changing the opinion on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25333[]' id='answer-id-104661' class='answer   answerof-25333 ' value='104661'   \/><label for='answer-id-104661' id='answer-label-104661' class=' answer'><span>Perform the appropriate substantive auditing procedures to corroborate the other information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25333[]' id='answer-id-104662' class='answer   answerof-25333 ' value='104662'   \/><label for='answer-id-104662' id='answer-label-104662' class=' answer'><span>Read the other information to determine that it is consistent with the audited financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-113' style=';'><div id='questionWrap-113'  class='   watupro-question-id-25334'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>113. <\/span>An auditor may report on condensed financial statements that are derived from complete audited financial statements if the:<\/div><input type='hidden' name='question_id[]' id='qID_113' value='25334' \/><input type='hidden' id='answerType25334' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25334[]' id='answer-id-104663' class='answer   answerof-25334 ' value='104663'   \/><label for='answer-id-104663' id='answer-label-104663' class=' answer'><span>Auditor indicates whether the information in the condensed financial statements is fairly stated in all material respects.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25334[]' id='answer-id-104664' class='answer   answerof-25334 ' value='104664'   \/><label for='answer-id-104664' id='answer-label-104664' class=' answer'><span>Condensed financial statements are presented in comparative form with the prior year's condensed financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25334[]' id='answer-id-104665' class='answer   answerof-25334 ' value='104665'   \/><label for='answer-id-104665' id='answer-label-104665' class=' answer'><span>Auditor describes the additional review procedures performed on the condensed financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25334[]' id='answer-id-104666' class='answer   answerof-25334 ' value='104666'   \/><label for='answer-id-104666' id='answer-label-104666' class=' answer'><span>Condensed financial statements are distributed only to management and the board of directors.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-114' style=';'><div id='questionWrap-114'  class='   watupro-question-id-25335'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>114. <\/span>If management (of a governmental body) declines to present supplementary information required by the Governmental Accounting Standards Board (GASB), the auditor should issue a(an):<\/div><input type='hidden' name='question_id[]' id='qID_114' value='25335' \/><input type='hidden' id='answerType25335' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25335[]' id='answer-id-104667' class='answer   answerof-25335 ' value='104667'   \/><label for='answer-id-104667' id='answer-label-104667' class=' answer'><span>Adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25335[]' id='answer-id-104668' class='answer   answerof-25335 ' value='104668'   \/><label for='answer-id-104668' id='answer-label-104668' class=' answer'><span>Qualified opinion with an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25335[]' id='answer-id-104669' class='answer   answerof-25335 ' value='104669'   \/><label for='answer-id-104669' id='answer-label-104669' class=' answer'><span>Unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25335[]' id='answer-id-104670' class='answer   answerof-25335 ' value='104670'   \/><label for='answer-id-104670' id='answer-label-104670' class=' answer'><span>Unqualified opinion with an additional explanatory paragraph.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-115' style=';'><div id='questionWrap-115'  class='   watupro-question-id-25336'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>115. <\/span>The objective of auditing procedures applied to segment information is to provide the auditor with a reasonable basis for concluding whether:<\/div><input type='hidden' name='question_id[]' id='qID_115' value='25336' \/><input type='hidden' id='answerType25336' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25336[]' id='answer-id-104671' class='answer   answerof-25336 ' value='104671'   \/><label for='answer-id-104671' id='answer-label-104671' class=' answer'><span>The information is useful for comparing a segment of one enterprise with a similar segment of another enterprise.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25336[]' id='answer-id-104672' class='answer   answerof-25336 ' value='104672'   \/><label for='answer-id-104672' id='answer-label-104672' class=' answer'><span>Sufficient audit evidence has been obtained to allow the auditor to be associated with the segment information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25336[]' id='answer-id-104673' class='answer   answerof-25336 ' value='104673'   \/><label for='answer-id-104673' id='answer-label-104673' class=' answer'><span>A separate opinion on the segment information is necessary due to inconsistent application of accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25336[]' id='answer-id-104674' class='answer   answerof-25336 ' value='104674'   \/><label for='answer-id-104674' id='answer-label-104674' class=' answer'><span>The information is presented in conformity with the FASB Statement on segment information.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-116' style=';'><div id='questionWrap-116'  class='   watupro-question-id-25337'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>116. <\/span>Green, CPA, is requested to render an opinion on the application of accounting principles by an entity that is audited by another CPA. Green may:<\/div><input type='hidden' name='question_id[]' id='qID_116' value='25337' \/><input type='hidden' id='answerType25337' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25337[]' id='answer-id-104675' class='answer   answerof-25337 ' value='104675'   \/><label for='answer-id-104675' id='answer-label-104675' class=' answer'><span>Not accept such an engagement because to do so would be considered unethical.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25337[]' id='answer-id-104676' class='answer   answerof-25337 ' value='104676'   \/><label for='answer-id-104676' id='answer-label-104676' class=' answer'><span>Not accept such an engagement because Green would lack the necessary information on which to base an opinion without conducting an audit.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25337[]' id='answer-id-104677' class='answer   answerof-25337 ' value='104677'   \/><label for='answer-id-104677' id='answer-label-104677' class=' answer'><span>Accept the engagement but should form an independent opinion without consulting with the continuing CPA.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25337[]' id='answer-id-104678' class='answer   answerof-25337 ' value='104678'   \/><label for='answer-id-104678' id='answer-label-104678' class=' answer'><span>Accept the engagement but should consult with the continuing CPA to ascertain all the available facts relevant to forming a professional judgment.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-117' style=';'><div id='questionWrap-117'  class='   watupro-question-id-25338'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>117. <\/span>In its annual report to shareholders, Lake Co. included a separate management report that contained additional information. Lake's auditor is expressing an unqualified opinion on Lake's financial statements but has not been engaged to examine and report on this additional information. <br \/>\r<br>What is the auditor's responsibility concerning such a report?<\/div><input type='hidden' name='question_id[]' id='qID_117' value='25338' \/><input type='hidden' id='answerType25338' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25338[]' id='answer-id-104679' class='answer   answerof-25338 ' value='104679'   \/><label for='answer-id-104679' id='answer-label-104679' class=' answer'><span>The auditor should add an explanatory paragraph to the report on the financial statements disclaiming an opinion on the additional information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25338[]' id='answer-id-104680' class='answer   answerof-25338 ' value='104680'   \/><label for='answer-id-104680' id='answer-label-104680' class=' answer'><span>The auditor has no obligation to read the management report or to verify the accuracy or appropriateness of its contents.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25338[]' id='answer-id-104681' class='answer   answerof-25338 ' value='104681'   \/><label for='answer-id-104681' id='answer-label-104681' class=' answer'><span>The auditor should request Lake to place the management report in its annual report where it will not be misinterpreted to be the auditor's assertion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25338[]' id='answer-id-104682' class='answer   answerof-25338 ' value='104682'   \/><label for='answer-id-104682' id='answer-label-104682' class=' answer'><span>The auditor should read the management report and consider whether it contains a material misstatement of fact.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-118' style=';'><div id='questionWrap-118'  class='   watupro-question-id-25339'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>118. <\/span>An auditor is reporting on condensed financial statements for an annual period that are derived from the audited financial statements of a publicly-held entity. <br \/>\r<br>The auditor's opinion should indicate whether the information in the condensed financial statements is fairly stated in all material respects:<\/div><input type='hidden' name='question_id[]' id='qID_118' value='25339' \/><input type='hidden' id='answerType25339' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25339[]' id='answer-id-104683' class='answer   answerof-25339 ' value='104683'   \/><label for='answer-id-104683' id='answer-label-104683' class=' answer'><span>In conformity with accounting principles generally accepted in the United States of America.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25339[]' id='answer-id-104684' class='answer   answerof-25339 ' value='104684'   \/><label for='answer-id-104684' id='answer-label-104684' class=' answer'><span>In relation to the complete financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25339[]' id='answer-id-104685' class='answer   answerof-25339 ' value='104685'   \/><label for='answer-id-104685' id='answer-label-104685' class=' answer'><span>In conformity with another comprehensive basis of accounting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25339[]' id='answer-id-104686' class='answer   answerof-25339 ' value='104686'   \/><label for='answer-id-104686' id='answer-label-104686' class=' answer'><span>In relation to supplementary filings under federal security statutes<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-119' style=';'><div id='questionWrap-119'  class='   watupro-question-id-25340'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>119. <\/span>An auditor determines that the entity is presenting certain supplementary financial disclosures of pension information that are required by the GASB. <br \/>\r<br>Under these circumstances, the auditor should:<\/div><input type='hidden' name='question_id[]' id='qID_119' value='25340' \/><input type='hidden' id='answerType25340' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25340[]' id='answer-id-104687' class='answer   answerof-25340 ' value='104687'   \/><label for='answer-id-104687' id='answer-label-104687' class=' answer'><span>Add an explanatory paragraph to the auditor's report that refers to the required supplementary information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25340[]' id='answer-id-104688' class='answer   answerof-25340 ' value='104688'   \/><label for='answer-id-104688' id='answer-label-104688' class=' answer'><span>State that the audit is not being performed in accordance with generally accepted auditing standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25340[]' id='answer-id-104689' class='answer   answerof-25340 ' value='104689'   \/><label for='answer-id-104689' id='answer-label-104689' class=' answer'><span>Document in the working papers that the required supplementary information is presented, but should not apply any procedures to the information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25340[]' id='answer-id-104690' class='answer   answerof-25340 ' value='104690'   \/><label for='answer-id-104690' id='answer-label-104690' class=' answer'><span>Compare the required supplementary information for consistency with the audited financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-120' style=';'><div id='questionWrap-120'  class='   watupro-question-id-25341'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>120. <\/span>An auditor reads the letter of transmittal accompanying a county's comprehensive annual financial report and identifies a material inconsistency with the financial statements. The auditor determines that the financial statements do not require revision. <br \/>\r<br>Which of the following actions should the auditor take?<\/div><input type='hidden' name='question_id[]' id='qID_120' value='25341' \/><input type='hidden' id='answerType25341' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25341[]' id='answer-id-104691' class='answer   answerof-25341 ' value='104691'   \/><label for='answer-id-104691' id='answer-label-104691' class=' answer'><span>Request that the client revise the letter of transmittal.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25341[]' id='answer-id-104692' class='answer   answerof-25341 ' value='104692'   \/><label for='answer-id-104692' id='answer-label-104692' class=' answer'><span>Include an explanatory paragraph in the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25341[]' id='answer-id-104693' class='answer   answerof-25341 ' value='104693'   \/><label for='answer-id-104693' id='answer-label-104693' class=' answer'><span>Consider withdrawing from the engagement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25341[]' id='answer-id-104694' class='answer   answerof-25341 ' value='104694'   \/><label for='answer-id-104694' id='answer-label-104694' class=' answer'><span>Request a client representation letter acknowledging the inconsistency.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-121' style=';'><div id='questionWrap-121'  class='   watupro-question-id-25342'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>121. <\/span>Pell, CPA, decides to serve as principal auditor in the audit of the financial statements of Tech Consolidated, Inc. Smith, CPA, audits one of Tech's subsidiaries. <br \/>\r<br>In which situation(s) should Pell make reference to Smith's audit? <br \/>\r<br>I. Pell reviews Smith's audit documentation and assumes responsibility for Smith's work, but expresses a qualified opinion on Tech's financial statements. <br \/>\r<br>II. Pell is unable to review Smith's audit documentation; however, Pell's inquiries indicate that Smith has an excellent reputation for professional competence and integrity.<\/div><input type='hidden' name='question_id[]' id='qID_121' value='25342' \/><input type='hidden' id='answerType25342' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25342[]' id='answer-id-104695' class='answer   answerof-25342 ' value='104695'   \/><label for='answer-id-104695' id='answer-label-104695' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25342[]' id='answer-id-104696' class='answer   answerof-25342 ' value='104696'   \/><label for='answer-id-104696' id='answer-label-104696' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25342[]' id='answer-id-104697' class='answer   answerof-25342 ' value='104697'   \/><label for='answer-id-104697' id='answer-label-104697' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25342[]' id='answer-id-104698' class='answer   answerof-25342 ' value='104698'   \/><label for='answer-id-104698' id='answer-label-104698' class=' answer'><span>Neither I nor I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-122' style=';'><div id='questionWrap-122'  class='   watupro-question-id-25343'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>122. <\/span>Which of the following best describes what is meant by the term generally accepted auditing standards?<\/div><input type='hidden' name='question_id[]' id='qID_122' value='25343' \/><input type='hidden' id='answerType25343' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25343[]' id='answer-id-104699' class='answer   answerof-25343 ' value='104699'   \/><label for='answer-id-104699' id='answer-label-104699' class=' answer'><span>Rules acknowledged by the accounting profession because of their universal application.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25343[]' id='answer-id-104700' class='answer   answerof-25343 ' value='104700'   \/><label for='answer-id-104700' id='answer-label-104700' class=' answer'><span>Pronouncements issued by the Auditing Standards Board.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25343[]' id='answer-id-104701' class='answer   answerof-25343 ' value='104701'   \/><label for='answer-id-104701' id='answer-label-104701' class=' answer'><span>Measures of the quality of the auditor's performance.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25343[]' id='answer-id-104702' class='answer   answerof-25343 ' value='104702'   \/><label for='answer-id-104702' id='answer-label-104702' class=' answer'><span>Procedures to be used to gather evidence to support financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-123' style=';'><div id='questionWrap-123'  class='   watupro-question-id-25344'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>123. <\/span>According to the profession's ethical standards, which of the following events may justify a departure from a Statement of Financial Accounting Standards? <br \/>\r<br><br><img decoding=\"async\" width=500 height=95 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image026.jpg\" v:shapes=\"_x0000_i1037\"><br><\/div><input type='hidden' name='question_id[]' id='qID_123' value='25344' \/><input type='hidden' id='answerType25344' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25344[]' id='answer-id-104703' class='answer   answerof-25344 ' value='104703'   \/><label for='answer-id-104703' id='answer-label-104703' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25344[]' id='answer-id-104704' class='answer   answerof-25344 ' value='104704'   \/><label for='answer-id-104704' id='answer-label-104704' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25344[]' id='answer-id-104705' class='answer   answerof-25344 ' value='104705'   \/><label for='answer-id-104705' id='answer-label-104705' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25344[]' id='answer-id-104706' class='answer   answerof-25344 ' value='104706'   \/><label for='answer-id-104706' id='answer-label-104706' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-124' style=';'><div id='questionWrap-124'  class='   watupro-question-id-25345'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>124. <\/span>Which of the following conditions or events most likely would cause an auditor to have substantial doubt about an entity's ability to continue as a going concern?<\/div><input type='hidden' name='question_id[]' id='qID_124' value='25345' \/><input type='hidden' id='answerType25345' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25345[]' id='answer-id-104707' class='answer   answerof-25345 ' value='104707'   \/><label for='answer-id-104707' id='answer-label-104707' class=' answer'><span>Cash flows from operating activities are negative.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25345[]' id='answer-id-104708' class='answer   answerof-25345 ' value='104708'   \/><label for='answer-id-104708' id='answer-label-104708' class=' answer'><span>Research and development projects are postponed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25345[]' id='answer-id-104709' class='answer   answerof-25345 ' value='104709'   \/><label for='answer-id-104709' id='answer-label-104709' class=' answer'><span>Significant related party transactions are pervasive.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25345[]' id='answer-id-104710' class='answer   answerof-25345 ' value='104710'   \/><label for='answer-id-104710' id='answer-label-104710' class=' answer'><span>Stock dividends replace annual cash dividends.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-125' style=';'><div id='questionWrap-125'  class='   watupro-question-id-25346'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>125. <\/span>For an entity that does not receive governmental financial assistance, an auditor's standard report on financial statements generally would not refer to:<\/div><input type='hidden' name='question_id[]' id='qID_125' value='25346' \/><input type='hidden' id='answerType25346' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25346[]' id='answer-id-104711' class='answer   answerof-25346 ' value='104711'   \/><label for='answer-id-104711' id='answer-label-104711' class=' answer'><span>Significant estimates made by management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25346[]' id='answer-id-104712' class='answer   answerof-25346 ' value='104712'   \/><label for='answer-id-104712' id='answer-label-104712' class=' answer'><span>An assessment of the entity's accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25346[]' id='answer-id-104713' class='answer   answerof-25346 ' value='104713'   \/><label for='answer-id-104713' id='answer-label-104713' class=' answer'><span>Management's responsibility for the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25346[]' id='answer-id-104714' class='answer   answerof-25346 ' value='104714'   \/><label for='answer-id-104714' id='answer-label-104714' class=' answer'><span>The entity's internal control.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-126' style=';'><div id='questionWrap-126'  class='   watupro-question-id-25347'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>126. <\/span>Which of the following procedures should an auditor generally perform regarding subsequent events?<\/div><input type='hidden' name='question_id[]' id='qID_126' value='25347' \/><input type='hidden' id='answerType25347' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25347[]' id='answer-id-104715' class='answer   answerof-25347 ' value='104715'   \/><label for='answer-id-104715' id='answer-label-104715' class=' answer'><span>Compare the latest available interim financial statements with the financial statements being audited.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25347[]' id='answer-id-104716' class='answer   answerof-25347 ' value='104716'   \/><label for='answer-id-104716' id='answer-label-104716' class=' answer'><span>Send second requests to the client's customers who failed to respond to initial accounts receivable confirmation requests.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25347[]' id='answer-id-104717' class='answer   answerof-25347 ' value='104717'   \/><label for='answer-id-104717' id='answer-label-104717' class=' answer'><span>Communicate material weaknesses in the internal control structure to those charged with governance.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25347[]' id='answer-id-104718' class='answer   answerof-25347 ' value='104718'   \/><label for='answer-id-104718' id='answer-label-104718' class=' answer'><span>Review the cut-off bank statements for several months after the year-end.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-127' style=';'><div id='questionWrap-127'  class='   watupro-question-id-25348'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>127. <\/span>An auditor's report contains the following sentences: We did not audit the financial statements of JK Co., a wholly owned subsidiary, which statements reflect total assets and revenues constituting 17 percent and 19 percent, respectively, of the related consolidated totals. Those statements were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for JK Co., is based solely on the report of the other auditors. <br \/>\r<br>These sentences:<\/div><input type='hidden' name='question_id[]' id='qID_127' value='25348' \/><input type='hidden' id='answerType25348' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25348[]' id='answer-id-104719' class='answer   answerof-25348 ' value='104719'   \/><label for='answer-id-104719' id='answer-label-104719' class=' answer'><span>Are an improper form of reporting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25348[]' id='answer-id-104720' class='answer   answerof-25348 ' value='104720'   \/><label for='answer-id-104720' id='answer-label-104720' class=' answer'><span>Divide responsibility.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25348[]' id='answer-id-104721' class='answer   answerof-25348 ' value='104721'   \/><label for='answer-id-104721' id='answer-label-104721' class=' answer'><span>Disclaim an opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25348[]' id='answer-id-104722' class='answer   answerof-25348 ' value='104722'   \/><label for='answer-id-104722' id='answer-label-104722' class=' answer'><span>Qualify the opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-128' style=';'><div id='questionWrap-128'  class='   watupro-question-id-25349'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>128. <\/span>Which of the following phrases should be included in the opinion paragraph when an auditor expresses a qualified opinion? <br \/>\r<br><br><img decoding=\"async\" width=534 height=96 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image028.jpg\" v:shapes=\"_x0000_i1038\"><br><\/div><input type='hidden' name='question_id[]' id='qID_128' value='25349' \/><input type='hidden' id='answerType25349' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25349[]' id='answer-id-104723' class='answer   answerof-25349 ' value='104723'   \/><label for='answer-id-104723' id='answer-label-104723' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25349[]' id='answer-id-104724' class='answer   answerof-25349 ' value='104724'   \/><label for='answer-id-104724' id='answer-label-104724' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25349[]' id='answer-id-104725' class='answer   answerof-25349 ' value='104725'   \/><label for='answer-id-104725' id='answer-label-104725' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25349[]' id='answer-id-104726' class='answer   answerof-25349 ' value='104726'   \/><label for='answer-id-104726' id='answer-label-104726' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-129' style=';'><div id='questionWrap-129'  class='   watupro-question-id-25350'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>129. <\/span>Which of the following procedures would an auditor most likely perform to obtain evidence about the occurrence of subsequent events?<\/div><input type='hidden' name='question_id[]' id='qID_129' value='25350' \/><input type='hidden' id='answerType25350' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25350[]' id='answer-id-104727' class='answer   answerof-25350 ' value='104727'   \/><label for='answer-id-104727' id='answer-label-104727' class=' answer'><span>Recomputing a sample of large-dollar transactions occurring after year-end for arithmetic accuracy.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25350[]' id='answer-id-104728' class='answer   answerof-25350 ' value='104728'   \/><label for='answer-id-104728' id='answer-label-104728' class=' answer'><span>Investigating changes in stockholders' equity occurring after year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25350[]' id='answer-id-104729' class='answer   answerof-25350 ' value='104729'   \/><label for='answer-id-104729' id='answer-label-104729' class=' answer'><span>Inquiring of the entity's legal counsel concerning litigation, claims, and assessments arising after yearend.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25350[]' id='answer-id-104730' class='answer   answerof-25350 ' value='104730'   \/><label for='answer-id-104730' id='answer-label-104730' class=' answer'><span>Confirming bank accounts established after year-end.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-130' style=';'><div id='questionWrap-130'  class='   watupro-question-id-25351'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>130. <\/span>What is an auditor's responsibility for supplementary information required by the GASB that is placed outside the basic financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_130' value='25351' \/><input type='hidden' id='answerType25351' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25351[]' id='answer-id-104731' class='answer   answerof-25351 ' value='104731'   \/><label for='answer-id-104731' id='answer-label-104731' class=' answer'><span>Label the information as unaudited and expand the auditor's report to include a disclaimer on the information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25351[]' id='answer-id-104732' class='answer   answerof-25351 ' value='104732'   \/><label for='answer-id-104732' id='answer-label-104732' class=' answer'><span>Add an explanatory paragraph to the auditor's report and refer to the information as &quot;required supplementary information.&quot;<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25351[]' id='answer-id-104733' class='answer   answerof-25351 ' value='104733'   \/><label for='answer-id-104733' id='answer-label-104733' class=' answer'><span>Apply limited procedures to the information and report deficiencies in, or the omission of, the information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25351[]' id='answer-id-104734' class='answer   answerof-25351 ' value='104734'   \/><label for='answer-id-104734' id='answer-label-104734' class=' answer'><span>Audit the required supplementary information in accordance with generally accepted governmental auditing standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-131' style=';'><div id='questionWrap-131'  class='   watupro-question-id-25352'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>131. <\/span>An auditor's responsibility to express an opinion on the financial statements is:<\/div><input type='hidden' name='question_id[]' id='qID_131' value='25352' \/><input type='hidden' id='answerType25352' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25352[]' id='answer-id-104735' class='answer   answerof-25352 ' value='104735'   \/><label for='answer-id-104735' id='answer-label-104735' class=' answer'><span>Implicitly represented in the auditor's standard report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25352[]' id='answer-id-104736' class='answer   answerof-25352 ' value='104736'   \/><label for='answer-id-104736' id='answer-label-104736' class=' answer'><span>Explicitly represented in the opening paragraph of the auditor's standard report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25352[]' id='answer-id-104737' class='answer   answerof-25352 ' value='104737'   \/><label for='answer-id-104737' id='answer-label-104737' class=' answer'><span>Explicitly represented in the scope paragraph of the auditor's standard report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25352[]' id='answer-id-104738' class='answer   answerof-25352 ' value='104738'   \/><label for='answer-id-104738' id='answer-label-104738' class=' answer'><span>Explicitly represented in the opinion paragraph of the auditor's standard report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-132' style=';'><div id='questionWrap-132'  class='   watupro-question-id-25353'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>132. <\/span>When an independent CPA assists in preparing the financial statements of a publicly held entity, but has not audited or reviewed them, the CPA should issue a disclaimer of opinion. In such situations, the CPA has no responsibility to apply any procedures beyond:<\/div><input type='hidden' name='question_id[]' id='qID_132' value='25353' \/><input type='hidden' id='answerType25353' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25353[]' id='answer-id-104739' class='answer   answerof-25353 ' value='104739'   \/><label for='answer-id-104739' id='answer-label-104739' class=' answer'><span>Ascertaining whether the financial statements are in conformity with generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25353[]' id='answer-id-104740' class='answer   answerof-25353 ' value='104740'   \/><label for='answer-id-104740' id='answer-label-104740' class=' answer'><span>Determining whether management has elected to omit substantially all required disclosures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25353[]' id='answer-id-104741' class='answer   answerof-25353 ' value='104741'   \/><label for='answer-id-104741' id='answer-label-104741' class=' answer'><span>Documenting that the internal control structure is not being relied on.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25353[]' id='answer-id-104742' class='answer   answerof-25353 ' value='104742'   \/><label for='answer-id-104742' id='answer-label-104742' class=' answer'><span>Reading the financial statements for obvious material misstatements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-133' style=';'><div id='questionWrap-133'  class='   watupro-question-id-25354'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>133. <\/span>An auditor issued an audit report that was dual dated for a subsequent event occurring after the original date of the auditor's report. <br \/>\r<br>The auditor's responsibility for events occurring subsequent to the original date was:<\/div><input type='hidden' name='question_id[]' id='qID_133' value='25354' \/><input type='hidden' id='answerType25354' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25354[]' id='answer-id-104743' class='answer   answerof-25354 ' value='104743'   \/><label for='answer-id-104743' id='answer-label-104743' class=' answer'><span>Extended to subsequent events occurring through the date of reissuance of the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25354[]' id='answer-id-104744' class='answer   answerof-25354 ' value='104744'   \/><label for='answer-id-104744' id='answer-label-104744' class=' answer'><span>Extended to include all events occurring since the original date of the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25354[]' id='answer-id-104745' class='answer   answerof-25354 ' value='104745'   \/><label for='answer-id-104745' id='answer-label-104745' class=' answer'><span>Limited to the specific event referenced.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25354[]' id='answer-id-104746' class='answer   answerof-25354 ' value='104746'   \/><label for='answer-id-104746' id='answer-label-104746' class=' answer'><span>Limited to include only events occurring up to the date of the last subsequent event referenced.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-134' style=';'><div id='questionWrap-134'  class='   watupro-question-id-25355'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>134. <\/span>An auditor most likely would issue a disclaimer of opinion because of:<\/div><input type='hidden' name='question_id[]' id='qID_134' value='25355' \/><input type='hidden' id='answerType25355' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25355[]' id='answer-id-104747' class='answer   answerof-25355 ' value='104747'   \/><label for='answer-id-104747' id='answer-label-104747' class=' answer'><span>Inadequate disclosure of material information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25355[]' id='answer-id-104748' class='answer   answerof-25355 ' value='104748'   \/><label for='answer-id-104748' id='answer-label-104748' class=' answer'><span>The omission of the statement of cash flows.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25355[]' id='answer-id-104749' class='answer   answerof-25355 ' value='104749'   \/><label for='answer-id-104749' id='answer-label-104749' class=' answer'><span>A material departure from generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25355[]' id='answer-id-104750' class='answer   answerof-25355 ' value='104750'   \/><label for='answer-id-104750' id='answer-label-104750' class=' answer'><span>Management's refusal to furnish written representations.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-135' style=';'><div id='questionWrap-135'  class='   watupro-question-id-25356'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>135. <\/span>When an auditor qualifies an opinion because of the inability to confirm accounts receivable by direct communication with debtors, the wording of the opinion paragraph of the auditor's report should indicate that the qualification pertains to the:<\/div><input type='hidden' name='question_id[]' id='qID_135' value='25356' \/><input type='hidden' id='answerType25356' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25356[]' id='answer-id-104751' class='answer   answerof-25356 ' value='104751'   \/><label for='answer-id-104751' id='answer-label-104751' class=' answer'><span>Limitation on the auditor's scope.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25356[]' id='answer-id-104752' class='answer   answerof-25356 ' value='104752'   \/><label for='answer-id-104752' id='answer-label-104752' class=' answer'><span>Possible effects on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25356[]' id='answer-id-104753' class='answer   answerof-25356 ' value='104753'   \/><label for='answer-id-104753' id='answer-label-104753' class=' answer'><span>Lack of sufficient appropriate audit evidence.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25356[]' id='answer-id-104754' class='answer   answerof-25356 ' value='104754'   \/><label for='answer-id-104754' id='answer-label-104754' class=' answer'><span>Departure from generally accepted auditing standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-136' style=';'><div id='questionWrap-136'  class='   watupro-question-id-25357'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>136. <\/span>The adverse effects of events causing an auditor to believe there is substantial doubt about an entity's ability to continue as a going concern would most likely be mitigated by evidence relating to the:<\/div><input type='hidden' name='question_id[]' id='qID_136' value='25357' \/><input type='hidden' id='answerType25357' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25357[]' id='answer-id-104755' class='answer   answerof-25357 ' value='104755'   \/><label for='answer-id-104755' id='answer-label-104755' class=' answer'><span>Ability to expand operations into new product lines in the future.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25357[]' id='answer-id-104756' class='answer   answerof-25357 ' value='104756'   \/><label for='answer-id-104756' id='answer-label-104756' class=' answer'><span>Feasibility of plans to purchase leased equipment at less than market value.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25357[]' id='answer-id-104757' class='answer   answerof-25357 ' value='104757'   \/><label for='answer-id-104757' id='answer-label-104757' class=' answer'><span>Marketability of assets that management plans to sell.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25357[]' id='answer-id-104758' class='answer   answerof-25357 ' value='104758'   \/><label for='answer-id-104758' id='answer-label-104758' class=' answer'><span>Committed arrangements to convert preferred stock to long-term debt.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-137' style=';'><div id='questionWrap-137'  class='   watupro-question-id-25358'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>137. <\/span>An auditor was unable to obtain audited financial statements or other evidence supporting an entity's investment in a foreign subsidiary. <br \/>\r<br>Between which of the following opinions should the entity's auditor choose?<\/div><input type='hidden' name='question_id[]' id='qID_137' value='25358' \/><input type='hidden' id='answerType25358' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25358[]' id='answer-id-104759' class='answer   answerof-25358 ' value='104759'   \/><label for='answer-id-104759' id='answer-label-104759' class=' answer'><span>Adverse and unqualified with an explanatory paragraph added.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25358[]' id='answer-id-104760' class='answer   answerof-25358 ' value='104760'   \/><label for='answer-id-104760' id='answer-label-104760' class=' answer'><span>Disclaimer and unqualified with an explanatory paragraph added.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25358[]' id='answer-id-104761' class='answer   answerof-25358 ' value='104761'   \/><label for='answer-id-104761' id='answer-label-104761' class=' answer'><span>Qualified and adverse.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25358[]' id='answer-id-104762' class='answer   answerof-25358 ' value='104762'   \/><label for='answer-id-104762' id='answer-label-104762' class=' answer'><span>Qualified and disclaimer.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-138' style=';'><div id='questionWrap-138'  class='   watupro-question-id-25359'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>138. <\/span>Which of the following standards requires a critical review of the work done and the judgment exercised by those assisting in an audit at every level of supervision?<\/div><input type='hidden' name='question_id[]' id='qID_138' value='25359' \/><input type='hidden' id='answerType25359' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25359[]' id='answer-id-104763' class='answer   answerof-25359 ' value='104763'   \/><label for='answer-id-104763' id='answer-label-104763' class=' answer'><span>Proficiency.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25359[]' id='answer-id-104764' class='answer   answerof-25359 ' value='104764'   \/><label for='answer-id-104764' id='answer-label-104764' class=' answer'><span>Audit risk.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25359[]' id='answer-id-104765' class='answer   answerof-25359 ' value='104765'   \/><label for='answer-id-104765' id='answer-label-104765' class=' answer'><span>Inspection.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25359[]' id='answer-id-104766' class='answer   answerof-25359 ' value='104766'   \/><label for='answer-id-104766' id='answer-label-104766' class=' answer'><span>Due care.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-139' style=';'><div id='questionWrap-139'  class='   watupro-question-id-25360'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>139. <\/span>Six months after issuing an unqualified opinion on audited financial statements, an auditor discovered that the engagement personnel failed to confirm several of the client's material accounts receivable balances. <br \/>\r<br>The auditor should first:<\/div><input type='hidden' name='question_id[]' id='qID_139' value='25360' \/><input type='hidden' id='answerType25360' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25360[]' id='answer-id-104767' class='answer   answerof-25360 ' value='104767'   \/><label for='answer-id-104767' id='answer-label-104767' class=' answer'><span>Request the permission of the client to undertake the confirmation of accounts receivable.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25360[]' id='answer-id-104768' class='answer   answerof-25360 ' value='104768'   \/><label for='answer-id-104768' id='answer-label-104768' class=' answer'><span>Perform alternative procedures to provide a satisfactory basis for the unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25360[]' id='answer-id-104769' class='answer   answerof-25360 ' value='104769'   \/><label for='answer-id-104769' id='answer-label-104769' class=' answer'><span>Assess the importance of the omitted procedures to the auditor's ability to support the expressed opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25360[]' id='answer-id-104770' class='answer   answerof-25360 ' value='104770'   \/><label for='answer-id-104770' id='answer-label-104770' class=' answer'><span>Inquire whether there are persons currently relying, or likely to rely, on the unqualified opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-140' style=';'><div id='questionWrap-140'  class='   watupro-question-id-25361'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>140. <\/span>Which of the following procedures would an auditor ordinarily perform during the review of subsequent events?<\/div><input type='hidden' name='question_id[]' id='qID_140' value='25361' \/><input type='hidden' id='answerType25361' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25361[]' id='answer-id-104771' class='answer   answerof-25361 ' value='104771'   \/><label for='answer-id-104771' id='answer-label-104771' class=' answer'><span>Review the cut-off bank statements for the period after the year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25361[]' id='answer-id-104772' class='answer   answerof-25361 ' value='104772'   \/><label for='answer-id-104772' id='answer-label-104772' class=' answer'><span>Inquire of the client's legal counsel concerning litigation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25361[]' id='answer-id-104773' class='answer   answerof-25361 ' value='104773'   \/><label for='answer-id-104773' id='answer-label-104773' class=' answer'><span>Investigate significant deficiencies in internal control previously communicated to the client.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25361[]' id='answer-id-104774' class='answer   answerof-25361 ' value='104774'   \/><label for='answer-id-104774' id='answer-label-104774' class=' answer'><span>Analyze related party transactions to discover possible irregularities.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-141' style=';'><div id='questionWrap-141'  class='   watupro-question-id-25362'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>141. <\/span>An annual shareholders' report includes audited financial statements and contains supplementary information required by GAAP. <br \/>\r<br>Is it permissible for the auditor to report on such information?<\/div><input type='hidden' name='question_id[]' id='qID_141' value='25362' \/><input type='hidden' id='answerType25362' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25362[]' id='answer-id-104775' class='answer   answerof-25362 ' value='104775'   \/><label for='answer-id-104775' id='answer-label-104775' class=' answer'><span>No, because such reporting may lead to the belief that the auditor is responsible for the information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25362[]' id='answer-id-104776' class='answer   answerof-25362 ' value='104776'   \/><label for='answer-id-104776' id='answer-label-104776' class=' answer'><span>No, because the auditor has no responsibility to read the other information in a document containing audited financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25362[]' id='answer-id-104777' class='answer   answerof-25362 ' value='104777'   \/><label for='answer-id-104777' id='answer-label-104777' class=' answer'><span>Yes, provided the report provides negative assurance only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25362[]' id='answer-id-104778' class='answer   answerof-25362 ' value='104778'   \/><label for='answer-id-104778' id='answer-label-104778' class=' answer'><span>Yes, provided the auditor performs sufficient audit procedures to determine whether the information is fairly stated, in all material respects, in relation to the financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-142' style=';'><div id='questionWrap-142'  class='   watupro-question-id-25363'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>142. <\/span>Tech Company has disclosed an uncertainty due to pending litigation. <br \/>\r<br>The auditor's decision to issue a qualified opinion rather than an unqualified opinion most likely would be determined by the:<\/div><input type='hidden' name='question_id[]' id='qID_142' value='25363' \/><input type='hidden' id='answerType25363' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25363[]' id='answer-id-104779' class='answer   answerof-25363 ' value='104779'   \/><label for='answer-id-104779' id='answer-label-104779' class=' answer'><span>Lack of sufficient evidence.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25363[]' id='answer-id-104780' class='answer   answerof-25363 ' value='104780'   \/><label for='answer-id-104780' id='answer-label-104780' class=' answer'><span>Inability to estimate the amount of loss.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25363[]' id='answer-id-104781' class='answer   answerof-25363 ' value='104781'   \/><label for='answer-id-104781' id='answer-label-104781' class=' answer'><span>Entity's lack of experience with such litigation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25363[]' id='answer-id-104782' class='answer   answerof-25363 ' value='104782'   \/><label for='answer-id-104782' id='answer-label-104782' class=' answer'><span>Lack of insurance coverage for possible losses from such litigation.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-143' style=';'><div id='questionWrap-143'  class='   watupro-question-id-25364'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>143. <\/span>It is not appropriate to refer a reader of an auditor's report to a financial statement footnote for details concerning:<\/div><input type='hidden' name='question_id[]' id='qID_143' value='25364' \/><input type='hidden' id='answerType25364' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25364[]' id='answer-id-104783' class='answer   answerof-25364 ' value='104783'   \/><label for='answer-id-104783' id='answer-label-104783' class=' answer'><span>Subsequent events.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25364[]' id='answer-id-104784' class='answer   answerof-25364 ' value='104784'   \/><label for='answer-id-104784' id='answer-label-104784' class=' answer'><span>The pro forma effects of a business combination.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25364[]' id='answer-id-104785' class='answer   answerof-25364 ' value='104785'   \/><label for='answer-id-104785' id='answer-label-104785' class=' answer'><span>Sale of a discontinued operation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25364[]' id='answer-id-104786' class='answer   answerof-25364 ' value='104786'   \/><label for='answer-id-104786' id='answer-label-104786' class=' answer'><span>The results of confirmation of receivables.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-144' style=';'><div id='questionWrap-144'  class='   watupro-question-id-25365'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>144. <\/span>Morris, CPA, suspects that a pervasive scheme of illegal bribes exists throughout the operations of Worldwide Import-Export, Inc., a new audit client. Morris notified the audit committee and Worldwide's legal counsel, but neither could assist Morris in determining whether the amounts involved were material to the financial statements or whether senior management was involved in the scheme. <br \/>\r<br>Under these circumstances, Morris should:<\/div><input type='hidden' name='question_id[]' id='qID_144' value='25365' \/><input type='hidden' id='answerType25365' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25365[]' id='answer-id-104787' class='answer   answerof-25365 ' value='104787'   \/><label for='answer-id-104787' id='answer-label-104787' class=' answer'><span>Express an unqualified opinion with a separate explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25365[]' id='answer-id-104788' class='answer   answerof-25365 ' value='104788'   \/><label for='answer-id-104788' id='answer-label-104788' class=' answer'><span>Disclaim an opinion on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25365[]' id='answer-id-104789' class='answer   answerof-25365 ' value='104789'   \/><label for='answer-id-104789' id='answer-label-104789' class=' answer'><span>Express an adverse opinion on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25365[]' id='answer-id-104790' class='answer   answerof-25365 ' value='104790'   \/><label for='answer-id-104790' id='answer-label-104790' class=' answer'><span>Issue a special report regarding the illegal bribes.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-145' style=';'><div id='questionWrap-145'  class='   watupro-question-id-25366'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>145. <\/span>The first general standard requires that an audit of financial statements is to be performed by a person or persons having:<\/div><input type='hidden' name='question_id[]' id='qID_145' value='25366' \/><input type='hidden' id='answerType25366' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25366[]' id='answer-id-104791' class='answer   answerof-25366 ' value='104791'   \/><label for='answer-id-104791' id='answer-label-104791' class=' answer'><span>Seasoned judgment in varying degrees of supervision and review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25366[]' id='answer-id-104792' class='answer   answerof-25366 ' value='104792'   \/><label for='answer-id-104792' id='answer-label-104792' class=' answer'><span>Adequate technical training and proficiency.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25366[]' id='answer-id-104793' class='answer   answerof-25366 ' value='104793'   \/><label for='answer-id-104793' id='answer-label-104793' class=' answer'><span>Knowledge of the standards of fieldwork and reporting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25366[]' id='answer-id-104794' class='answer   answerof-25366 ' value='104794'   \/><label for='answer-id-104794' id='answer-label-104794' class=' answer'><span>Independence with respect to the financial statements and supplementary disclosures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-146' style=';'><div id='questionWrap-146'  class='   watupro-question-id-25367'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>146. <\/span>An auditor's report that refers to the use of an accounting principle at variance with generally accepted accounting principles contains the words, &quot;In our opinion, with the foregoing Explanation, the financial statements referred to above present fairly....&quot; <br \/>\r<br>This is considered an:<\/div><input type='hidden' name='question_id[]' id='qID_146' value='25367' \/><input type='hidden' id='answerType25367' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25367[]' id='answer-id-104795' class='answer   answerof-25367 ' value='104795'   \/><label for='answer-id-104795' id='answer-label-104795' class=' answer'><span>Adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25367[]' id='answer-id-104796' class='answer   answerof-25367 ' value='104796'   \/><label for='answer-id-104796' id='answer-label-104796' class=' answer'><span>&quot;Except for&quot; qualified opinion<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25367[]' id='answer-id-104797' class='answer   answerof-25367 ' value='104797'   \/><label for='answer-id-104797' id='answer-label-104797' class=' answer'><span>Unqualified opinion with an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25367[]' id='answer-id-104798' class='answer   answerof-25367 ' value='104798'   \/><label for='answer-id-104798' id='answer-label-104798' class=' answer'><span>Example of inappropriate reporting.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-147' style=';'><div id='questionWrap-147'  class='   watupro-question-id-25368'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>147. <\/span>Management of Hill Company has decided not to account for a material transaction in accordance with the provisions of an FASB Standard. In setting forth its reasons in a note to the financial statements, management has clearly demonstrated that due to unusual circumstances the financial statements presented in accordance with the FASB Standard would be misleading. <br \/>\r<br>The auditor's report should include a separate explanatory paragraph and contain a(an):<\/div><input type='hidden' name='question_id[]' id='qID_147' value='25368' \/><input type='hidden' id='answerType25368' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25368[]' id='answer-id-104799' class='answer   answerof-25368 ' value='104799'   \/><label for='answer-id-104799' id='answer-label-104799' class=' answer'><span>&quot;Except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25368[]' id='answer-id-104800' class='answer   answerof-25368 ' value='104800'   \/><label for='answer-id-104800' id='answer-label-104800' class=' answer'><span>&quot;Subject to&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25368[]' id='answer-id-104801' class='answer   answerof-25368 ' value='104801'   \/><label for='answer-id-104801' id='answer-label-104801' class=' answer'><span>Adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25368[]' id='answer-id-104802' class='answer   answerof-25368 ' value='104802'   \/><label for='answer-id-104802' id='answer-label-104802' class=' answer'><span>Unqualified opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-148' style=';'><div id='questionWrap-148'  class='   watupro-question-id-25369'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>148. <\/span>A former client requests a predecessor auditor to reissue an audit report on a prior period's financial statements. The financial statements are not restated and the report is not revised. <br \/>\r<br>What date(s) should the predecessor auditor use in the reissued report?<\/div><input type='hidden' name='question_id[]' id='qID_148' value='25369' \/><input type='hidden' id='answerType25369' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25369[]' id='answer-id-104803' class='answer   answerof-25369 ' value='104803'   \/><label for='answer-id-104803' id='answer-label-104803' class=' answer'><span>The date of the prior-period report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25369[]' id='answer-id-104804' class='answer   answerof-25369 ' value='104804'   \/><label for='answer-id-104804' id='answer-label-104804' class=' answer'><span>The date of the client's request.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25369[]' id='answer-id-104805' class='answer   answerof-25369 ' value='104805'   \/><label for='answer-id-104805' id='answer-label-104805' class=' answer'><span>The date of reissue.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25369[]' id='answer-id-104806' class='answer   answerof-25369 ' value='104806'   \/><label for='answer-id-104806' id='answer-label-104806' class=' answer'><span>The dual-dates.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-149' style=';'><div id='questionWrap-149'  class='   watupro-question-id-25370'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>149. <\/span>Does an auditor make the following representations explicitly or implicitly when issuing the standard auditor's report on comparative financial statements? <br \/>\r<br><br><img decoding=\"async\" width=397 height=120 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image030.jpg\" v:shapes=\"_x0000_i1039\"><br><\/div><input type='hidden' name='question_id[]' id='qID_149' value='25370' \/><input type='hidden' id='answerType25370' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25370[]' id='answer-id-104807' class='answer   answerof-25370 ' value='104807'   \/><label for='answer-id-104807' id='answer-label-104807' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25370[]' id='answer-id-104808' class='answer   answerof-25370 ' value='104808'   \/><label for='answer-id-104808' id='answer-label-104808' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25370[]' id='answer-id-104809' class='answer   answerof-25370 ' value='104809'   \/><label for='answer-id-104809' id='answer-label-104809' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25370[]' id='answer-id-104810' class='answer   answerof-25370 ' value='104810'   \/><label for='answer-id-104810' id='answer-label-104810' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-150' style=';'><div id='questionWrap-150'  class='   watupro-question-id-25371'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>150. <\/span>An auditor may issue a qualified opinion under which of the following circumstances? <br \/>\r<br><br><img decoding=\"async\" width=406 height=117 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image032.jpg\" v:shapes=\"_x0000_i1040\"><br><\/div><input type='hidden' name='question_id[]' id='qID_150' value='25371' \/><input type='hidden' id='answerType25371' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25371[]' id='answer-id-104811' class='answer   answerof-25371 ' value='104811'   \/><label for='answer-id-104811' id='answer-label-104811' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25371[]' id='answer-id-104812' class='answer   answerof-25371 ' value='104812'   \/><label for='answer-id-104812' id='answer-label-104812' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25371[]' id='answer-id-104813' class='answer   answerof-25371 ' value='104813'   \/><label for='answer-id-104813' id='answer-label-104813' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25371[]' id='answer-id-104814' class='answer   answerof-25371 ' value='104814'   \/><label for='answer-id-104814' id='answer-label-104814' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-151' style=';'><div id='questionWrap-151'  class='   watupro-question-id-25372'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>151. <\/span>Grant Company's financial statements adequately disclose uncertainties that concern future events, the outcome of which are not susceptible of reasonable estimation. <br \/>\r<br>The auditor's report should include a (an):<\/div><input type='hidden' name='question_id[]' id='qID_151' value='25372' \/><input type='hidden' id='answerType25372' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25372[]' id='answer-id-104815' class='answer   answerof-25372 ' value='104815'   \/><label for='answer-id-104815' id='answer-label-104815' class=' answer'><span>Unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25372[]' id='answer-id-104816' class='answer   answerof-25372 ' value='104816'   \/><label for='answer-id-104816' id='answer-label-104816' class=' answer'><span>&quot;Subject to&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25372[]' id='answer-id-104817' class='answer   answerof-25372 ' value='104817'   \/><label for='answer-id-104817' id='answer-label-104817' class=' answer'><span>&quot;Except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25372[]' id='answer-id-104818' class='answer   answerof-25372 ' value='104818'   \/><label for='answer-id-104818' id='answer-label-104818' class=' answer'><span>Adverse opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-152' style=';'><div id='questionWrap-152'  class='   watupro-question-id-25373'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>152. <\/span>How are management's responsibility and the auditor's responsibility represented in the standard auditor's report? <br \/>\r<br><br><img decoding=\"async\" width=434 height=97 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image034.jpg\" v:shapes=\"_x0000_i1041\"><br><\/div><input type='hidden' name='question_id[]' id='qID_152' value='25373' \/><input type='hidden' id='answerType25373' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25373[]' id='answer-id-104819' class='answer   answerof-25373 ' value='104819'   \/><label for='answer-id-104819' id='answer-label-104819' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25373[]' id='answer-id-104820' class='answer   answerof-25373 ' value='104820'   \/><label for='answer-id-104820' id='answer-label-104820' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25373[]' id='answer-id-104821' class='answer   answerof-25373 ' value='104821'   \/><label for='answer-id-104821' id='answer-label-104821' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25373[]' id='answer-id-104822' class='answer   answerof-25373 ' value='104822'   \/><label for='answer-id-104822' id='answer-label-104822' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-153' style=';'><div id='questionWrap-153'  class='   watupro-question-id-25374'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>153. <\/span>When there is a significant change in accounting principle, an auditor's report should refer to the lack of consistency in:<\/div><input type='hidden' name='question_id[]' id='qID_153' value='25374' \/><input type='hidden' id='answerType25374' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25374[]' id='answer-id-104823' class='answer   answerof-25374 ' value='104823'   \/><label for='answer-id-104823' id='answer-label-104823' class=' answer'><span>The scope paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25374[]' id='answer-id-104824' class='answer   answerof-25374 ' value='104824'   \/><label for='answer-id-104824' id='answer-label-104824' class=' answer'><span>An explanatory paragraph between the second paragraph and the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25374[]' id='answer-id-104825' class='answer   answerof-25374 ' value='104825'   \/><label for='answer-id-104825' id='answer-label-104825' class=' answer'><span>The opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25374[]' id='answer-id-104826' class='answer   answerof-25374 ' value='104826'   \/><label for='answer-id-104826' id='answer-label-104826' class=' answer'><span>An explanatory paragraph following the opinion paragraph.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-154' style=';'><div id='questionWrap-154'  class='   watupro-question-id-25375'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>154. <\/span>When a principal auditor decides to make reference to another auditor's examination, the principal auditor's report should always indicate clearly, in the introductory, scope, and opinion paragraphs, the:<\/div><input type='hidden' name='question_id[]' id='qID_154' value='25375' \/><input type='hidden' id='answerType25375' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25375[]' id='answer-id-104827' class='answer   answerof-25375 ' value='104827'   \/><label for='answer-id-104827' id='answer-label-104827' class=' answer'><span>Magnitude of the portion of the financial statements examined by the other auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25375[]' id='answer-id-104828' class='answer   answerof-25375 ' value='104828'   \/><label for='answer-id-104828' id='answer-label-104828' class=' answer'><span>Disclaimer of responsibility concerning the portion of the financial statements examined by the other auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25375[]' id='answer-id-104829' class='answer   answerof-25375 ' value='104829'   \/><label for='answer-id-104829' id='answer-label-104829' class=' answer'><span>Name of the other auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25375[]' id='answer-id-104830' class='answer   answerof-25375 ' value='104830'   \/><label for='answer-id-104830' id='answer-label-104830' class=' answer'><span>Division of responsibility.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-155' style=';'><div id='questionWrap-155'  class='   watupro-question-id-25376'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>155. <\/span>Information accompanying the basic financial statements in an auditor-submitted document should not include:<\/div><input type='hidden' name='question_id[]' id='qID_155' value='25376' \/><input type='hidden' id='answerType25376' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25376[]' id='answer-id-104831' class='answer   answerof-25376 ' value='104831'   \/><label for='answer-id-104831' id='answer-label-104831' class=' answer'><span>An analysis of inventory by location.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25376[]' id='answer-id-104832' class='answer   answerof-25376 ' value='104832'   \/><label for='answer-id-104832' id='answer-label-104832' class=' answer'><span>A statement that the allowance for doubtful accounts is adequate.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25376[]' id='answer-id-104833' class='answer   answerof-25376 ' value='104833'   \/><label for='answer-id-104833' id='answer-label-104833' class=' answer'><span>A statement that the depreciable life of a new asset is 20 years.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25376[]' id='answer-id-104834' class='answer   answerof-25376 ' value='104834'   \/><label for='answer-id-104834' id='answer-label-104834' class=' answer'><span>An analysis of revenue by product line.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-156' style=';'><div id='questionWrap-156'  class='   watupro-question-id-25377'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>156. <\/span>For a particular entity's financial statements to be presented fairly in conformity with generally accepted accounting principles, it is not required that the principles selected:<\/div><input type='hidden' name='question_id[]' id='qID_156' value='25377' \/><input type='hidden' id='answerType25377' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25377[]' id='answer-id-104835' class='answer   answerof-25377 ' value='104835'   \/><label for='answer-id-104835' id='answer-label-104835' class=' answer'><span>Be appropriate in the circumstances for the particular entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25377[]' id='answer-id-104836' class='answer   answerof-25377 ' value='104836'   \/><label for='answer-id-104836' id='answer-label-104836' class=' answer'><span>Reflect transactions in a manner that presents the financial statements within a range of acceptable<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25377[]' id='answer-id-104837' class='answer   answerof-25377 ' value='104837'   \/><label for='answer-id-104837' id='answer-label-104837' class=' answer'><span>Present information in the financial statements that is classified and summarized in a reasonable manner.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25377[]' id='answer-id-104838' class='answer   answerof-25377 ' value='104838'   \/><label for='answer-id-104838' id='answer-label-104838' class=' answer'><span>Be applied on a basis consistent with those followed in the prior year.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-157' style=';'><div id='questionWrap-157'  class='   watupro-question-id-25378'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>157. <\/span>An auditor has been asked to report on the balance sheet of Kane Company but not on the other basic financial statements. The auditor will have access to all information underlying the basic financial statements. <br \/>\r<br>Under these circumstances, the auditor:<\/div><input type='hidden' name='question_id[]' id='qID_157' value='25378' \/><input type='hidden' id='answerType25378' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25378[]' id='answer-id-104839' class='answer   answerof-25378 ' value='104839'   \/><label for='answer-id-104839' id='answer-label-104839' class=' answer'><span>May accept the engagement because such engagements merely involve limited reporting objectives.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25378[]' id='answer-id-104840' class='answer   answerof-25378 ' value='104840'   \/><label for='answer-id-104840' id='answer-label-104840' class=' answer'><span>May accept the engagement but should disclaim an opinion because of an inability to apply the procedures considered necessary.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25378[]' id='answer-id-104841' class='answer   answerof-25378 ' value='104841'   \/><label for='answer-id-104841' id='answer-label-104841' class=' answer'><span>Should refuse the engagement because there is a client-imposed scope limitation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25378[]' id='answer-id-104842' class='answer   answerof-25378 ' value='104842'   \/><label for='answer-id-104842' id='answer-label-104842' class=' answer'><span>Should refuse the engagement in accordance with generally accepted auditing standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-158' style=';'><div id='questionWrap-158'  class='   watupro-question-id-25379'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>158. <\/span>If an accounting change has no material effect on the financial statements in the current year, but the change is reasonably certain to have a material effect in later years, the change should be:<\/div><input type='hidden' name='question_id[]' id='qID_158' value='25379' \/><input type='hidden' id='answerType25379' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25379[]' id='answer-id-104843' class='answer   answerof-25379 ' value='104843'   \/><label for='answer-id-104843' id='answer-label-104843' class=' answer'><span>Treated as a consistency modification in the auditor's report for the current year.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25379[]' id='answer-id-104844' class='answer   answerof-25379 ' value='104844'   \/><label for='answer-id-104844' id='answer-label-104844' class=' answer'><span>Disclosed in the notes to the financial statements of the current year.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25379[]' id='answer-id-104845' class='answer   answerof-25379 ' value='104845'   \/><label for='answer-id-104845' id='answer-label-104845' class=' answer'><span>Disclosed in the notes to the financial statements and referred to in the auditor's report for the current year.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25379[]' id='answer-id-104846' class='answer   answerof-25379 ' value='104846'   \/><label for='answer-id-104846' id='answer-label-104846' class=' answer'><span>Treated as a subsequent event.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-159' style=';'><div id='questionWrap-159'  class='   watupro-question-id-25380'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>159. <\/span>To exercise due professional care an auditor should:<\/div><input type='hidden' name='question_id[]' id='qID_159' value='25380' \/><input type='hidden' id='answerType25380' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25380[]' id='answer-id-104847' class='answer   answerof-25380 ' value='104847'   \/><label for='answer-id-104847' id='answer-label-104847' class=' answer'><span>Critically review the judgment exercised by those assisting in the audit.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25380[]' id='answer-id-104848' class='answer   answerof-25380 ' value='104848'   \/><label for='answer-id-104848' id='answer-label-104848' class=' answer'><span>Examine all available corroborating evidence supporting management's assertions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25380[]' id='answer-id-104849' class='answer   answerof-25380 ' value='104849'   \/><label for='answer-id-104849' id='answer-label-104849' class=' answer'><span>Design the audit to detect all instances of illegal acts.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25380[]' id='answer-id-104850' class='answer   answerof-25380 ' value='104850'   \/><label for='answer-id-104850' id='answer-label-104850' class=' answer'><span>Attain the proper balance of professional experience and formal education.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-160' style=';'><div id='questionWrap-160'  class='   watupro-question-id-25381'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>160. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List A represents the types of opinions the auditor ordinarily would issue. Select as the best answer for this item, the action the auditor normally would take. The types of opinions in List A may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>In auditing the long-term investments account, an auditor is unable to obtain audited financial statements for an investee located in a foreign country. The auditor concludes that sufficient appropriate audit evidence regarding this investment cannot be obtained. <br \/>\r<br>List A Types of Options<\/div><input type='hidden' name='question_id[]' id='qID_160' value='25381' \/><input type='hidden' id='answerType25381' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25381[]' id='answer-id-104851' class='answer   answerof-25381 ' value='104851'   \/><label for='answer-id-104851' id='answer-label-104851' class=' answer'><span>An &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25381[]' id='answer-id-104852' class='answer   answerof-25381 ' value='104852'   \/><label for='answer-id-104852' id='answer-label-104852' class=' answer'><span>An unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25381[]' id='answer-id-104853' class='answer   answerof-25381 ' value='104853'   \/><label for='answer-id-104853' id='answer-label-104853' class=' answer'><span>An adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25381[]' id='answer-id-104854' class='answer   answerof-25381 ' value='104854'   \/><label for='answer-id-104854' id='answer-label-104854' class=' answer'><span>A disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25381[]' id='answer-id-104855' class='answer   answerof-25381 ' value='104855'   \/><label for='answer-id-104855' id='answer-label-104855' class=' answer'><span>Either an &quot;except for&quot; qualified opinion or an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25381[]' id='answer-id-104856' class='answer   answerof-25381 ' value='104856'   \/><label for='answer-id-104856' id='answer-label-104856' class=' answer'><span>Either a disclaimer of opinion or an &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25381[]' id='answer-id-104857' class='answer   answerof-25381 ' value='104857'   \/><label for='answer-id-104857' id='answer-label-104857' class=' answer'><span>Either an adverse opinion or a disclaimer of opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-161' style=';'><div id='questionWrap-161'  class='   watupro-question-id-25382'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>161. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List B represents the report modifications (if any) that would be necessary. Select as the best answer for each item, the action the auditor normally would take. The report modifications in List B may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>In auditing the long-term investments account, an auditor is unable to obtain audited financial statements for an investee located in a foreign country. The auditor concludes that sufficient appropriate audit evidence regarding this investment cannot be obtained. <br \/>\r<br>List B Report Modifications<\/div><input type='hidden' name='question_id[]' id='qID_161' value='25382' \/><input type='hidden' id='answerType25382' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104858' class='answer   answerof-25382 ' value='104858'   \/><label for='answer-id-104858' id='answer-label-104858' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104859' class='answer   answerof-25382 ' value='104859'   \/><label for='answer-id-104859' id='answer-label-104859' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104860' class='answer   answerof-25382 ' value='104860'   \/><label for='answer-id-104860' id='answer-label-104860' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104861' class='answer   answerof-25382 ' value='104861'   \/><label for='answer-id-104861' id='answer-label-104861' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104862' class='answer   answerof-25382 ' value='104862'   \/><label for='answer-id-104862' id='answer-label-104862' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104863' class='answer   answerof-25382 ' value='104863'   \/><label for='answer-id-104863' id='answer-label-104863' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104864' class='answer   answerof-25382 ' value='104864'   \/><label for='answer-id-104864' id='answer-label-104864' class=' answer'><span>Describe the circumstances within the scope paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104865' class='answer   answerof-25382 ' value='104865'   \/><label for='answer-id-104865' id='answer-label-104865' class=' answer'><span>Describe the circumstances within the opinion paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104866' class='answer   answerof-25382 ' value='104866'   \/><label for='answer-id-104866' id='answer-label-104866' class=' answer'><span>Describe the circumstances within the scope and opinion paragraphs without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25382[]' id='answer-id-104867' class='answer   answerof-25382 ' value='104867'   \/><label for='answer-id-104867' id='answer-label-104867' class=' answer'><span>Issue the standard auditor's report without modification.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-162' style=';'><div id='questionWrap-162'  class='   watupro-question-id-25383'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>162. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List A represents the types of opinions the auditor ordinarily would issue. Select as the best answer for this item, the action the auditor normally would take. The types of opinions in List A may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>Due to recurring operating losses and working capital deficiencies, an auditor has substantial doubt about an entity's ability to continue as a going concern for a reasonable period of time. <br \/>\r<br>However, the financial statement disclosures concerning these matters are adequate. <br \/>\r<br>List A Types of Options<\/div><input type='hidden' name='question_id[]' id='qID_162' value='25383' \/><input type='hidden' id='answerType25383' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25383[]' id='answer-id-104868' class='answer   answerof-25383 ' value='104868'   \/><label for='answer-id-104868' id='answer-label-104868' class=' answer'><span>An &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25383[]' id='answer-id-104869' class='answer   answerof-25383 ' value='104869'   \/><label for='answer-id-104869' id='answer-label-104869' class=' answer'><span>An unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25383[]' id='answer-id-104870' class='answer   answerof-25383 ' value='104870'   \/><label for='answer-id-104870' id='answer-label-104870' class=' answer'><span>An adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25383[]' id='answer-id-104871' class='answer   answerof-25383 ' value='104871'   \/><label for='answer-id-104871' id='answer-label-104871' class=' answer'><span>A disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25383[]' id='answer-id-104872' class='answer   answerof-25383 ' value='104872'   \/><label for='answer-id-104872' id='answer-label-104872' class=' answer'><span>Either an &quot;except for&quot; qualified opinion or an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25383[]' id='answer-id-104873' class='answer   answerof-25383 ' value='104873'   \/><label for='answer-id-104873' id='answer-label-104873' class=' answer'><span>Either a disclaimer of opinion or an &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25383[]' id='answer-id-104874' class='answer   answerof-25383 ' value='104874'   \/><label for='answer-id-104874' id='answer-label-104874' class=' answer'><span>Either an adverse opinion or a disclaimer of opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-163' style=';'><div id='questionWrap-163'  class='   watupro-question-id-25384'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>163. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List B represents the report modifications (if any) that would be necessary. Select as the best answer for each item, the action the auditor normally would take. The report modifications in List B may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>Due to recurring operating losses and working capital deficiencies, an auditor has substantial doubt about an entity's ability to continue as a going concern for a reasonable period of time. <br \/>\r<br>However, the financial statement disclosures concerning these matters are adequate. List B Report Modifications<\/div><input type='hidden' name='question_id[]' id='qID_163' value='25384' \/><input type='hidden' id='answerType25384' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104875' class='answer   answerof-25384 ' value='104875'   \/><label for='answer-id-104875' id='answer-label-104875' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104876' class='answer   answerof-25384 ' value='104876'   \/><label for='answer-id-104876' id='answer-label-104876' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104877' class='answer   answerof-25384 ' value='104877'   \/><label for='answer-id-104877' id='answer-label-104877' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104878' class='answer   answerof-25384 ' value='104878'   \/><label for='answer-id-104878' id='answer-label-104878' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104879' class='answer   answerof-25384 ' value='104879'   \/><label for='answer-id-104879' id='answer-label-104879' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104880' class='answer   answerof-25384 ' value='104880'   \/><label for='answer-id-104880' id='answer-label-104880' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104881' class='answer   answerof-25384 ' value='104881'   \/><label for='answer-id-104881' id='answer-label-104881' class=' answer'><span>Describe the circumstances within the scope paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104882' class='answer   answerof-25384 ' value='104882'   \/><label for='answer-id-104882' id='answer-label-104882' class=' answer'><span>Describe the circumstances within the opinion paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104883' class='answer   answerof-25384 ' value='104883'   \/><label for='answer-id-104883' id='answer-label-104883' class=' answer'><span>Describe the circumstances within the scope and opinion paragraphs without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25384[]' id='answer-id-104884' class='answer   answerof-25384 ' value='104884'   \/><label for='answer-id-104884' id='answer-label-104884' class=' answer'><span>Issue the standard auditor's report without modification.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-164' style=';'><div id='questionWrap-164'  class='   watupro-question-id-25385'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>164. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List A represents the types of opinions the auditor ordinarily would issue. Select as the best answer for this item, the action the auditor normally would take. The types of opinions in List A may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>A principal auditor decides to take responsibility for the work of another CPA who audited a wholly-owned subsidiary of the entity and issued an unqualified opinion. The total assets and revenues of the subsidiary represent 17% and 18%, respectively, of the total assets and revenues of the entity being audited. List A Types of Options<\/div><input type='hidden' name='question_id[]' id='qID_164' value='25385' \/><input type='hidden' id='answerType25385' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25385[]' id='answer-id-104885' class='answer   answerof-25385 ' value='104885'   \/><label for='answer-id-104885' id='answer-label-104885' class=' answer'><span>An &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25385[]' id='answer-id-104886' class='answer   answerof-25385 ' value='104886'   \/><label for='answer-id-104886' id='answer-label-104886' class=' answer'><span>An unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25385[]' id='answer-id-104887' class='answer   answerof-25385 ' value='104887'   \/><label for='answer-id-104887' id='answer-label-104887' class=' answer'><span>An adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25385[]' id='answer-id-104888' class='answer   answerof-25385 ' value='104888'   \/><label for='answer-id-104888' id='answer-label-104888' class=' answer'><span>A disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25385[]' id='answer-id-104889' class='answer   answerof-25385 ' value='104889'   \/><label for='answer-id-104889' id='answer-label-104889' class=' answer'><span>Either an &quot;except for&quot; qualified opinion or an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25385[]' id='answer-id-104890' class='answer   answerof-25385 ' value='104890'   \/><label for='answer-id-104890' id='answer-label-104890' class=' answer'><span>Either a disclaimer of opinion or an &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25385[]' id='answer-id-104891' class='answer   answerof-25385 ' value='104891'   \/><label for='answer-id-104891' id='answer-label-104891' class=' answer'><span>Either an adverse opinion or a disclaimer of opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-165' style=';'><div id='questionWrap-165'  class='   watupro-question-id-25386'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>165. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List B represents the report modifications (if any) that would be necessary. Select as the best answer for each item, the action the auditor normally would take. The report modifications in List B may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>A principal auditor decides to take responsibility for the work of another CPA who audited a wholly-owned subsidiary of the entity and issued an unqualified opinion. The total assets and revenues of the subsidiary represent 17% and 18%, respectively, of the total assets and revenues of the entity being audited. <br \/>\r<br>List B Report Modifications<\/div><input type='hidden' name='question_id[]' id='qID_165' value='25386' \/><input type='hidden' id='answerType25386' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104892' class='answer   answerof-25386 ' value='104892'   \/><label for='answer-id-104892' id='answer-label-104892' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104893' class='answer   answerof-25386 ' value='104893'   \/><label for='answer-id-104893' id='answer-label-104893' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104894' class='answer   answerof-25386 ' value='104894'   \/><label for='answer-id-104894' id='answer-label-104894' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104895' class='answer   answerof-25386 ' value='104895'   \/><label for='answer-id-104895' id='answer-label-104895' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104896' class='answer   answerof-25386 ' value='104896'   \/><label for='answer-id-104896' id='answer-label-104896' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104897' class='answer   answerof-25386 ' value='104897'   \/><label for='answer-id-104897' id='answer-label-104897' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104898' class='answer   answerof-25386 ' value='104898'   \/><label for='answer-id-104898' id='answer-label-104898' class=' answer'><span>Describe the circumstances within the scope paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104899' class='answer   answerof-25386 ' value='104899'   \/><label for='answer-id-104899' id='answer-label-104899' class=' answer'><span>Describe the circumstances within the opinion paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104900' class='answer   answerof-25386 ' value='104900'   \/><label for='answer-id-104900' id='answer-label-104900' class=' answer'><span>Describe the circumstances within the scope and opinion paragraphs without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25386[]' id='answer-id-104901' class='answer   answerof-25386 ' value='104901'   \/><label for='answer-id-104901' id='answer-label-104901' class=' answer'><span>Issue the standard auditor's report without modification.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-166' style=';'><div id='questionWrap-166'  class='   watupro-question-id-25387'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>166. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List A represents the types of opinions the auditor ordinarily would issue. Select as the best answer for this item, the action the auditor normally would take. The types of opinions in List A may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>An entity issues financial statements that present financial position and results of operations but omits the related statement of cash flows. Management discloses in the notes to the financial statements that it does not believe the statement of cash flows to be a useful financial statement. List A Types of Options<\/div><input type='hidden' name='question_id[]' id='qID_166' value='25387' \/><input type='hidden' id='answerType25387' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25387[]' id='answer-id-104902' class='answer   answerof-25387 ' value='104902'   \/><label for='answer-id-104902' id='answer-label-104902' class=' answer'><span>An &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25387[]' id='answer-id-104903' class='answer   answerof-25387 ' value='104903'   \/><label for='answer-id-104903' id='answer-label-104903' class=' answer'><span>An unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25387[]' id='answer-id-104904' class='answer   answerof-25387 ' value='104904'   \/><label for='answer-id-104904' id='answer-label-104904' class=' answer'><span>An adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25387[]' id='answer-id-104905' class='answer   answerof-25387 ' value='104905'   \/><label for='answer-id-104905' id='answer-label-104905' class=' answer'><span>A disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25387[]' id='answer-id-104906' class='answer   answerof-25387 ' value='104906'   \/><label for='answer-id-104906' id='answer-label-104906' class=' answer'><span>Either an &quot;except for&quot; qualified opinion or an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25387[]' id='answer-id-104907' class='answer   answerof-25387 ' value='104907'   \/><label for='answer-id-104907' id='answer-label-104907' class=' answer'><span>Either a disclaimer of opinion or an &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25387[]' id='answer-id-104908' class='answer   answerof-25387 ' value='104908'   \/><label for='answer-id-104908' id='answer-label-104908' class=' answer'><span>Either an adverse opinion or a disclaimer of opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-167' style=';'><div id='questionWrap-167'  class='   watupro-question-id-25388'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>167. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List B represents the report modifications (if any) that would be necessary. Select as the best answer for each item, the action the auditor normally would take. The report modifications in List B may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>An entity issues financial statements that present financial position and results of operations but omits the related statement of cash flows. Management discloses in the notes to the financial statements that it does not believe the statement of cash flows to be a useful financial statement. List B Report Modifications<\/div><input type='hidden' name='question_id[]' id='qID_167' value='25388' \/><input type='hidden' id='answerType25388' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104909' class='answer   answerof-25388 ' value='104909'   \/><label for='answer-id-104909' id='answer-label-104909' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104910' class='answer   answerof-25388 ' value='104910'   \/><label for='answer-id-104910' id='answer-label-104910' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104911' class='answer   answerof-25388 ' value='104911'   \/><label for='answer-id-104911' id='answer-label-104911' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104912' class='answer   answerof-25388 ' value='104912'   \/><label for='answer-id-104912' id='answer-label-104912' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104913' class='answer   answerof-25388 ' value='104913'   \/><label for='answer-id-104913' id='answer-label-104913' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104914' class='answer   answerof-25388 ' value='104914'   \/><label for='answer-id-104914' id='answer-label-104914' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104915' class='answer   answerof-25388 ' value='104915'   \/><label for='answer-id-104915' id='answer-label-104915' class=' answer'><span>Describe the circumstances within the scope paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104916' class='answer   answerof-25388 ' value='104916'   \/><label for='answer-id-104916' id='answer-label-104916' class=' answer'><span>Describe the circumstances within the opinion paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104917' class='answer   answerof-25388 ' value='104917'   \/><label for='answer-id-104917' id='answer-label-104917' class=' answer'><span>Describe the circumstances within the scope and opinion paragraphs without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25388[]' id='answer-id-104918' class='answer   answerof-25388 ' value='104918'   \/><label for='answer-id-104918' id='answer-label-104918' class=' answer'><span>Issue the standard auditor's report without modification.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-168' style=';'><div id='questionWrap-168'  class='   watupro-question-id-25389'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>168. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List A represents the types of opinions the auditor ordinarily would issue. Select as the best answer for this item, the action the auditor normally would take. The types of opinions in List A may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>An entity changes its depreciation method for production equipment from the straight-line to a units-of production method based on hours of utilization. The auditor concurs with the change although it has a material effect on the comparability of the entity's financial statements. List A Types of Options<\/div><input type='hidden' name='question_id[]' id='qID_168' value='25389' \/><input type='hidden' id='answerType25389' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25389[]' id='answer-id-104919' class='answer   answerof-25389 ' value='104919'   \/><label for='answer-id-104919' id='answer-label-104919' class=' answer'><span>An \u201cexcept for\u201d qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25389[]' id='answer-id-104920' class='answer   answerof-25389 ' value='104920'   \/><label for='answer-id-104920' id='answer-label-104920' class=' answer'><span>An unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25389[]' id='answer-id-104921' class='answer   answerof-25389 ' value='104921'   \/><label for='answer-id-104921' id='answer-label-104921' class=' answer'><span>An adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25389[]' id='answer-id-104922' class='answer   answerof-25389 ' value='104922'   \/><label for='answer-id-104922' id='answer-label-104922' class=' answer'><span>A disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25389[]' id='answer-id-104923' class='answer   answerof-25389 ' value='104923'   \/><label for='answer-id-104923' id='answer-label-104923' class=' answer'><span>Either an \u201cexcept for\u201d qualified opinion or an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25389[]' id='answer-id-104924' class='answer   answerof-25389 ' value='104924'   \/><label for='answer-id-104924' id='answer-label-104924' class=' answer'><span>Either a disclaimer of opinion or an \u201cexcept for\u201d qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25389[]' id='answer-id-104925' class='answer   answerof-25389 ' value='104925'   \/><label for='answer-id-104925' id='answer-label-104925' class=' answer'><span>Either an adverse opinion or a disclaimer of opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-169' style=';'><div id='questionWrap-169'  class='   watupro-question-id-25390'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>169. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List B represents the report modifications (if any) that would be necessary. Select as the best answer for each item, the action the auditor normally would take. The report modifications in List B may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>An entity changes its depreciation method for production equipment from the straight-line to a units-of production method based on hours of utilization. The auditor concurs with the change although it has a material effect on the comparability of the entity's financial statements. List B Report Modifications<\/div><input type='hidden' name='question_id[]' id='qID_169' value='25390' \/><input type='hidden' id='answerType25390' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104926' class='answer   answerof-25390 ' value='104926'   \/><label for='answer-id-104926' id='answer-label-104926' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104927' class='answer   answerof-25390 ' value='104927'   \/><label for='answer-id-104927' id='answer-label-104927' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104928' class='answer   answerof-25390 ' value='104928'   \/><label for='answer-id-104928' id='answer-label-104928' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104929' class='answer   answerof-25390 ' value='104929'   \/><label for='answer-id-104929' id='answer-label-104929' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104930' class='answer   answerof-25390 ' value='104930'   \/><label for='answer-id-104930' id='answer-label-104930' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104931' class='answer   answerof-25390 ' value='104931'   \/><label for='answer-id-104931' id='answer-label-104931' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104932' class='answer   answerof-25390 ' value='104932'   \/><label for='answer-id-104932' id='answer-label-104932' class=' answer'><span>Describe the circumstances within the scope paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104933' class='answer   answerof-25390 ' value='104933'   \/><label for='answer-id-104933' id='answer-label-104933' class=' answer'><span>Describe the circumstances within the opinion paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104934' class='answer   answerof-25390 ' value='104934'   \/><label for='answer-id-104934' id='answer-label-104934' class=' answer'><span>Describe the circumstances within the scope and opinion paragraphs without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25390[]' id='answer-id-104935' class='answer   answerof-25390 ' value='104935'   \/><label for='answer-id-104935' id='answer-label-104935' class=' answer'><span>Issue the standard auditor\u2019s report without modification.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-170' style=';'><div id='questionWrap-170'  class='   watupro-question-id-25391'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>170. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List A represents the types of opinions the auditor ordinarily would issue. Select as the best answer for this item, the action the auditor normally would take. The types of opinions in List A may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>An entity is a defendant in a lawsuit alleging infringement of certain patent rights. <br \/>\r<br>However, the ultimate outcome of the litigation cannot be reasonably estimated by management. The auditor believes there is a reasonable possibility of a significantly material loss, but the lawsuit is adequately disclosed in the notes to the financial statements. List A Types of Options<\/div><input type='hidden' name='question_id[]' id='qID_170' value='25391' \/><input type='hidden' id='answerType25391' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25391[]' id='answer-id-104936' class='answer   answerof-25391 ' value='104936'   \/><label for='answer-id-104936' id='answer-label-104936' class=' answer'><span>An &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25391[]' id='answer-id-104937' class='answer   answerof-25391 ' value='104937'   \/><label for='answer-id-104937' id='answer-label-104937' class=' answer'><span>An unqualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25391[]' id='answer-id-104938' class='answer   answerof-25391 ' value='104938'   \/><label for='answer-id-104938' id='answer-label-104938' class=' answer'><span>An adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25391[]' id='answer-id-104939' class='answer   answerof-25391 ' value='104939'   \/><label for='answer-id-104939' id='answer-label-104939' class=' answer'><span>A disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25391[]' id='answer-id-104940' class='answer   answerof-25391 ' value='104940'   \/><label for='answer-id-104940' id='answer-label-104940' class=' answer'><span>Either an &quot;except for&quot; qualified opinion or an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25391[]' id='answer-id-104941' class='answer   answerof-25391 ' value='104941'   \/><label for='answer-id-104941' id='answer-label-104941' class=' answer'><span>Either a disclaimer of opinion or an &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25391[]' id='answer-id-104942' class='answer   answerof-25391 ' value='104942'   \/><label for='answer-id-104942' id='answer-label-104942' class=' answer'><span>Either an adverse opinion or a disclaimer of opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-171' style=';'><div id='questionWrap-171'  class='   watupro-question-id-25392'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>171. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List B represents the report modifications (if any) that would be necessary. Select as the best answer for each item, the action the auditor normally would take. The report modifications in List B may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>An entity is a defendant in a lawsuit alleging infringement of certain patent rights. <br \/>\r<br>However, the ultimate outcome of the litigation cannot be reasonably estimated by management. The auditor believes there is a reasonable possibility of a significantly material loss, but the lawsuit is adequately disclosed in the notes to the financial statements. List B Report Modifications<\/div><input type='hidden' name='question_id[]' id='qID_171' value='25392' \/><input type='hidden' id='answerType25392' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104943' class='answer   answerof-25392 ' value='104943'   \/><label for='answer-id-104943' id='answer-label-104943' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104944' class='answer   answerof-25392 ' value='104944'   \/><label for='answer-id-104944' id='answer-label-104944' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104945' class='answer   answerof-25392 ' value='104945'   \/><label for='answer-id-104945' id='answer-label-104945' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104946' class='answer   answerof-25392 ' value='104946'   \/><label for='answer-id-104946' id='answer-label-104946' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104947' class='answer   answerof-25392 ' value='104947'   \/><label for='answer-id-104947' id='answer-label-104947' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104948' class='answer   answerof-25392 ' value='104948'   \/><label for='answer-id-104948' id='answer-label-104948' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104949' class='answer   answerof-25392 ' value='104949'   \/><label for='answer-id-104949' id='answer-label-104949' class=' answer'><span>Describe the circumstances within the scope paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104950' class='answer   answerof-25392 ' value='104950'   \/><label for='answer-id-104950' id='answer-label-104950' class=' answer'><span>Describe the circumstances within the opinion paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104951' class='answer   answerof-25392 ' value='104951'   \/><label for='answer-id-104951' id='answer-label-104951' class=' answer'><span>Describe the circumstances within the scope and opinion paragraphs without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25392[]' id='answer-id-104952' class='answer   answerof-25392 ' value='104952'   \/><label for='answer-id-104952' id='answer-label-104952' class=' answer'><span>Issue the standard auditor's report without modification.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-172' style=';'><div id='questionWrap-172'  class='   watupro-question-id-25393'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>172. <\/span>This question presents independent factual situations an auditor might encounter in conducting an audit. List B represents the report modifications (if any) that would be necessary. Select as the best answer for each item, the action the auditor normally would take. The report modifications in List B may be selected once, more than once, or not at all. <br \/>\r<br>Assume: <br \/>\r<br>- The auditor is independent. <br \/>\r<br>- The auditor previously expressed an unqualified opinion on the prior year's financial statements. <br \/>\r<br>- Only single-year (not comparative) statements are presented for the current year. <br \/>\r<br>- The conditions for an unqualified opinion exist unless contradicted in the factual situations. <br \/>\r<br>- The conditions stated in the factual situations are material. <br \/>\r<br>- No report modifications are to be made except in response to the factual situation. <br \/>\r<br>Item to Be Answered <br \/>\r<br>An entity discloses in the notes to the financial statements certain lease obligations. The auditor believes that the failure to capitalize these leases is a departure from generally accepted accounting principles. List B Report Modifications<\/div><input type='hidden' name='question_id[]' id='qID_172' value='25393' \/><input type='hidden' id='answerType25393' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104953' class='answer   answerof-25393 ' value='104953'   \/><label for='answer-id-104953' id='answer-label-104953' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104954' class='answer   answerof-25393 ' value='104954'   \/><label for='answer-id-104954' id='answer-label-104954' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph without modifying the three standard paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104955' class='answer   answerof-25393 ' value='104955'   \/><label for='answer-id-104955' id='answer-label-104955' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104956' class='answer   answerof-25393 ' value='104956'   \/><label for='answer-id-104956' id='answer-label-104956' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the opinion paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104957' class='answer   answerof-25393 ' value='104957'   \/><label for='answer-id-104957' id='answer-label-104957' class=' answer'><span>Describe the circumstances in an explanatory paragraph preceding the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104958' class='answer   answerof-25393 ' value='104958'   \/><label for='answer-id-104958' id='answer-label-104958' class=' answer'><span>Describe the circumstances in an explanatory paragraph following the opinion paragraph and modify the scope and opinion paragraphs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104959' class='answer   answerof-25393 ' value='104959'   \/><label for='answer-id-104959' id='answer-label-104959' class=' answer'><span>Describe the circumstances within the scope paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104960' class='answer   answerof-25393 ' value='104960'   \/><label for='answer-id-104960' id='answer-label-104960' class=' answer'><span>Describe the circumstances within the opinion paragraph without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104961' class='answer   answerof-25393 ' value='104961'   \/><label for='answer-id-104961' id='answer-label-104961' class=' answer'><span>Describe the circumstances within the scope and opinion paragraphs without adding an explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25393[]' id='answer-id-104962' class='answer   answerof-25393 ' value='104962'   \/><label for='answer-id-104962' id='answer-label-104962' class=' answer'><span>Issue the standard auditor's report without modification.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-173' style=';'><div id='questionWrap-173'  class='   watupro-question-id-25394'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>173. <\/span>The nature and extent of a CPA firm's quality control policies and procedures depend on: <br \/>\r<br><br><img decoding=\"async\" width=604 height=118 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image036.jpg\" v:shapes=\"_x0000_i1042\"><br><\/div><input type='hidden' name='question_id[]' id='qID_173' value='25394' \/><input type='hidden' id='answerType25394' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25394[]' id='answer-id-104963' class='answer   answerof-25394 ' value='104963'   \/><label for='answer-id-104963' id='answer-label-104963' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25394[]' id='answer-id-104964' class='answer   answerof-25394 ' value='104964'   \/><label for='answer-id-104964' id='answer-label-104964' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25394[]' id='answer-id-104965' class='answer   answerof-25394 ' value='104965'   \/><label for='answer-id-104965' id='answer-label-104965' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25394[]' id='answer-id-104966' class='answer   answerof-25394 ' value='104966'   \/><label for='answer-id-104966' id='answer-label-104966' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-174' style=';'><div id='questionWrap-174'  class='   watupro-question-id-25395'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>174. <\/span>Would the following factors ordinarily be considered in planning an audit engagement's personnel requirements? <br \/>\r<br><br><img decoding=\"async\" width=388 height=115 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image038.jpg\" v:shapes=\"_x0000_i1043\"><br><\/div><input type='hidden' name='question_id[]' id='qID_174' value='25395' \/><input type='hidden' id='answerType25395' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25395[]' id='answer-id-104967' class='answer   answerof-25395 ' value='104967'   \/><label for='answer-id-104967' id='answer-label-104967' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25395[]' id='answer-id-104968' class='answer   answerof-25395 ' value='104968'   \/><label for='answer-id-104968' id='answer-label-104968' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25395[]' id='answer-id-104969' class='answer   answerof-25395 ' value='104969'   \/><label for='answer-id-104969' id='answer-label-104969' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25395[]' id='answer-id-104970' class='answer   answerof-25395 ' value='104970'   \/><label for='answer-id-104970' id='answer-label-104970' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-175' style=';'><div id='questionWrap-175'  class='   watupro-question-id-25396'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>175. <\/span>After fieldwork audit procedures are completed, a partner of the CPA firm who has not been involved in the audit performs a second or wrap-up review of the audit documentation. <br \/>\r<br>This second review usually focuses on:<\/div><input type='hidden' name='question_id[]' id='qID_175' value='25396' \/><input type='hidden' id='answerType25396' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25396[]' id='answer-id-104971' class='answer   answerof-25396 ' value='104971'   \/><label for='answer-id-104971' id='answer-label-104971' class=' answer'><span>The fair presentation of the financial statements in conformity with GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25396[]' id='answer-id-104972' class='answer   answerof-25396 ' value='104972'   \/><label for='answer-id-104972' id='answer-label-104972' class=' answer'><span>Fraud involving the client's management and its employees.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25396[]' id='answer-id-104973' class='answer   answerof-25396 ' value='104973'   \/><label for='answer-id-104973' id='answer-label-104973' class=' answer'><span>The materiality of the adjusting entries proposed by the audit staff.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25396[]' id='answer-id-104974' class='answer   answerof-25396 ' value='104974'   \/><label for='answer-id-104974' id='answer-label-104974' class=' answer'><span>The communication of internal control weaknesses to those charged with governance.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-176' style=';'><div id='questionWrap-176'  class='   watupro-question-id-25397'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>176. <\/span>The primary purpose of establishing quality control policies and procedures for deciding whether to accept a new client is to:<\/div><input type='hidden' name='question_id[]' id='qID_176' value='25397' \/><input type='hidden' id='answerType25397' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25397[]' id='answer-id-104975' class='answer   answerof-25397 ' value='104975'   \/><label for='answer-id-104975' id='answer-label-104975' class=' answer'><span>Enable the CPA firm to attest to the reliability of the client.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25397[]' id='answer-id-104976' class='answer   answerof-25397 ' value='104976'   \/><label for='answer-id-104976' id='answer-label-104976' class=' answer'><span>Satisfy the CPA firm's duty to the public concerning the acceptance of new clients.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25397[]' id='answer-id-104977' class='answer   answerof-25397 ' value='104977'   \/><label for='answer-id-104977' id='answer-label-104977' class=' answer'><span>Minimize the likelihood of association with clients whose management lacks integrity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25397[]' id='answer-id-104978' class='answer   answerof-25397 ' value='104978'   \/><label for='answer-id-104978' id='answer-label-104978' class=' answer'><span>Anticipate before performing any fieldwork whether an unqualified opinion can be expressed.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-177' style=';'><div id='questionWrap-177'  class='   watupro-question-id-25398'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>177. <\/span>A CPA firm evaluates its personnel advancement experience to ascertain whether individuals meeting stated criteria are assigned increased degrees of responsibility. <br \/>\r<br>This is evidence of the firm's adherence to which of the following prescribed standards:<\/div><input type='hidden' name='question_id[]' id='qID_177' value='25398' \/><input type='hidden' id='answerType25398' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25398[]' id='answer-id-104979' class='answer   answerof-25398 ' value='104979'   \/><label for='answer-id-104979' id='answer-label-104979' class=' answer'><span>Professional ethics.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25398[]' id='answer-id-104980' class='answer   answerof-25398 ' value='104980'   \/><label for='answer-id-104980' id='answer-label-104980' class=' answer'><span>Supervision and review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25398[]' id='answer-id-104981' class='answer   answerof-25398 ' value='104981'   \/><label for='answer-id-104981' id='answer-label-104981' class=' answer'><span>Accounting and review services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25398[]' id='answer-id-104982' class='answer   answerof-25398 ' value='104982'   \/><label for='answer-id-104982' id='answer-label-104982' class=' answer'><span>Quality control.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-178' style=';'><div id='questionWrap-178'  class='   watupro-question-id-25399'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>178. <\/span>The primary purpose of establishing quality control policies and procedures for deciding whether to accept new clients is to:<\/div><input type='hidden' name='question_id[]' id='qID_178' value='25399' \/><input type='hidden' id='answerType25399' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25399[]' id='answer-id-104983' class='answer   answerof-25399 ' value='104983'   \/><label for='answer-id-104983' id='answer-label-104983' class=' answer'><span>Minimize the likelihood of association with clients whose management lacks integrity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25399[]' id='answer-id-104984' class='answer   answerof-25399 ' value='104984'   \/><label for='answer-id-104984' id='answer-label-104984' class=' answer'><span>Monitor significant deficiencies in the design and operation of the client's internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25399[]' id='answer-id-104985' class='answer   answerof-25399 ' value='104985'   \/><label for='answer-id-104985' id='answer-label-104985' class=' answer'><span>Identify noncompliance with aspects of contractual agreements that affect the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25399[]' id='answer-id-104986' class='answer   answerof-25399 ' value='104986'   \/><label for='answer-id-104986' id='answer-label-104986' class=' answer'><span>Provide reasonable assurance that personnel will be adequately trained to fulfill their assigned responsibilities.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-179' style=';'><div id='questionWrap-179'  class='   watupro-question-id-25400'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>179. <\/span>Jackson &amp; Company, CPAs, plan to audit the financial statements of Perigee Technologies, an issuer as defined under the Sarbanes-Oxley Act of 2002. <br \/>\r<br>Which of the following situations would impair Jackson's independence?<\/div><input type='hidden' name='question_id[]' id='qID_179' value='25400' \/><input type='hidden' id='answerType25400' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25400[]' id='answer-id-104987' class='answer   answerof-25400 ' value='104987'   \/><label for='answer-id-104987' id='answer-label-104987' class=' answer'><span>Provision of personal tax services to Johnson, the accounts payable manager of Perigee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25400[]' id='answer-id-104988' class='answer   answerof-25400 ' value='104988'   \/><label for='answer-id-104988' id='answer-label-104988' class=' answer'><span>Preparation of Perigee's routine annual tax return, where Jackson's fee will be calculated as a percentage of the tax refund obtained.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25400[]' id='answer-id-104989' class='answer   answerof-25400 ' value='104989'   \/><label for='answer-id-104989' id='answer-label-104989' class=' answer'><span>An audit of Perigee's internal control is performed contemporaneously with the annual financial statement audit.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25400[]' id='answer-id-104990' class='answer   answerof-25400 ' value='104990'   \/><label for='answer-id-104990' id='answer-label-104990' class=' answer'><span>Discovering that Lowe, the chief financial officer of Perigee, started his accounting career ten years earlier as a staff accountant for Jackson &amp; Company, and continues to maintain ties with current partners at the firm.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-180' style=';'><div id='questionWrap-180'  class='   watupro-question-id-25401'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>180. <\/span>Which of the following are true regarding communication requirements an auditor must follow when providing tax services to an audit client who is an issuer under the Sarbanes-Oxley Act of 2002? <br \/>\r<br>I. The auditor must communicate to the audit committee, in writing, regarding the proposed tax services and related fees. <br \/>\r<br>II. The auditor must communicate to the audit committee, in writing, when the proposed tax services involve contingent fee arrangements. <br \/>\r<br>III. The auditor must discuss with the audit committee the potential effects of the proposed tax services on the firm's independence.<\/div><input type='hidden' name='question_id[]' id='qID_180' value='25401' \/><input type='hidden' id='answerType25401' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25401[]' id='answer-id-104991' class='answer   answerof-25401 ' value='104991'   \/><label for='answer-id-104991' id='answer-label-104991' class=' answer'><span>I and II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25401[]' id='answer-id-104992' class='answer   answerof-25401 ' value='104992'   \/><label for='answer-id-104992' id='answer-label-104992' class=' answer'><span>I, II, and II<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25401[]' id='answer-id-104993' class='answer   answerof-25401 ' value='104993'   \/><label for='answer-id-104993' id='answer-label-104993' class=' answer'><span>I and III only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25401[]' id='answer-id-104994' class='answer   answerof-25401 ' value='104994'   \/><label for='answer-id-104994' id='answer-label-104994' class=' answer'><span>II and III only.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-181' style=';'><div id='questionWrap-181'  class='   watupro-question-id-25402'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>181. <\/span>Financial information is presented in a printed form that prescribes the wording of the independent auditor's report. The form is not acceptable to the auditor because the form calls for statements that are inconsistent with the auditor's responsibility. <br \/>\r<br>Under these circumstances, the auditor most likely would:<\/div><input type='hidden' name='question_id[]' id='qID_181' value='25402' \/><input type='hidden' id='answerType25402' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25402[]' id='answer-id-104995' class='answer   answerof-25402 ' value='104995'   \/><label for='answer-id-104995' id='answer-label-104995' class=' answer'><span>Withdraw from the engagement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25402[]' id='answer-id-104996' class='answer   answerof-25402 ' value='104996'   \/><label for='answer-id-104996' id='answer-label-104996' class=' answer'><span>Reword the form or attach a separate report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25402[]' id='answer-id-104997' class='answer   answerof-25402 ' value='104997'   \/><label for='answer-id-104997' id='answer-label-104997' class=' answer'><span>Express a qualified opinion with an Explanation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25402[]' id='answer-id-104998' class='answer   answerof-25402 ' value='104998'   \/><label for='answer-id-104998' id='answer-label-104998' class=' answer'><span>Restrict use of the report to the party who designed the form.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-182' style=';'><div id='questionWrap-182'  class='   watupro-question-id-25403'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>182. <\/span>Field is an employee of Gold Enterprises. Hardy, CPA, is asked to express an opinion on Field's profit participation in Gold's net income. <br \/>\r<br>Hardy may accept this engagement only if:<\/div><input type='hidden' name='question_id[]' id='qID_182' value='25403' \/><input type='hidden' id='answerType25403' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25403[]' id='answer-id-104999' class='answer   answerof-25403 ' value='104999'   \/><label for='answer-id-104999' id='answer-label-104999' class=' answer'><span>Hardy also audits Gold's complete financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25403[]' id='answer-id-105000' class='answer   answerof-25403 ' value='105000'   \/><label for='answer-id-105000' id='answer-label-105000' class=' answer'><span>Gold's financial statements are prepared in conformity with GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25403[]' id='answer-id-105001' class='answer   answerof-25403 ' value='105001'   \/><label for='answer-id-105001' id='answer-label-105001' class=' answer'><span>Hardy's report is available for distribution to Gold's other employees.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25403[]' id='answer-id-105002' class='answer   answerof-25403 ' value='105002'   \/><label for='answer-id-105002' id='answer-label-105002' class=' answer'><span>Field owns controlling interest in Gold.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-183' style=';'><div id='questionWrap-183'  class='   watupro-question-id-25404'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>183. <\/span>Due to a scope limitation, an auditor disclaimed an opinion on the financial statements taken as a whole, but the auditor's report included a statement that the current asset portion of the entity's balance sheet was fairly stated. <br \/>\r<br>The inclusion of this statement is:<\/div><input type='hidden' name='question_id[]' id='qID_183' value='25404' \/><input type='hidden' id='answerType25404' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25404[]' id='answer-id-105003' class='answer   answerof-25404 ' value='105003'   \/><label for='answer-id-105003' id='answer-label-105003' class=' answer'><span>Not appropriate because it may tend to overshadow the auditor's disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25404[]' id='answer-id-105004' class='answer   answerof-25404 ' value='105004'   \/><label for='answer-id-105004' id='answer-label-105004' class=' answer'><span>Not appropriate because the auditor is prohibited from reporting on only one basic financial statement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25404[]' id='answer-id-105005' class='answer   answerof-25404 ' value='105005'   \/><label for='answer-id-105005' id='answer-label-105005' class=' answer'><span>Appropriate provided the auditor's scope paragraph adequately describes the scope limitation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25404[]' id='answer-id-105006' class='answer   answerof-25404 ' value='105006'   \/><label for='answer-id-105006' id='answer-label-105006' class=' answer'><span>Appropriate provided the statement is in a separate paragraph preceding the disclaimer of opinion paragraph.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-184' style=';'><div id='questionWrap-184'  class='   watupro-question-id-25405'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>184. <\/span>A CPA is permitted to accept a separate engagement (not in conjunction with an audit of financial statements) to audit an entity's: <br \/>\r<br><br><img decoding=\"async\" width=468 height=96 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image040.jpg\" v:shapes=\"_x0000_i1044\"><br><\/div><input type='hidden' name='question_id[]' id='qID_184' value='25405' \/><input type='hidden' id='answerType25405' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25405[]' id='answer-id-105007' class='answer   answerof-25405 ' value='105007'   \/><label for='answer-id-105007' id='answer-label-105007' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25405[]' id='answer-id-105008' class='answer   answerof-25405 ' value='105008'   \/><label for='answer-id-105008' id='answer-label-105008' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25405[]' id='answer-id-105009' class='answer   answerof-25405 ' value='105009'   \/><label for='answer-id-105009' id='answer-label-105009' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25405[]' id='answer-id-105010' class='answer   answerof-25405 ' value='105010'   \/><label for='answer-id-105010' id='answer-label-105010' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-185' style=';'><div id='questionWrap-185'  class='   watupro-question-id-25406'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>185. <\/span>Delta Life Insurance Co. prepares its financial statements on an accounting basis insurance companies use pursuant to the rules of a state insurance commission. <br \/>\r<br>If Wall, CPA, Delta's auditor, discovers that the statements are not suitably titled, Wall should:<\/div><input type='hidden' name='question_id[]' id='qID_185' value='25406' \/><input type='hidden' id='answerType25406' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25406[]' id='answer-id-105011' class='answer   answerof-25406 ' value='105011'   \/><label for='answer-id-105011' id='answer-label-105011' class=' answer'><span>Disclose any reservations in an explanatory paragraph and qualify the opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25406[]' id='answer-id-105012' class='answer   answerof-25406 ' value='105012'   \/><label for='answer-id-105012' id='answer-label-105012' class=' answer'><span>Apply to the state insurance commission for an advisory opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25406[]' id='answer-id-105013' class='answer   answerof-25406 ' value='105013'   \/><label for='answer-id-105013' id='answer-label-105013' class=' answer'><span>Issue a special statutory basis report that clearly disclaims any opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25406[]' id='answer-id-105014' class='answer   answerof-25406 ' value='105014'   \/><label for='answer-id-105014' id='answer-label-105014' class=' answer'><span>Explain in the notes to the financial statements the terminology used.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-186' style=';'><div id='questionWrap-186'  class='   watupro-question-id-25407'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>186. <\/span>Helpful Co., a nonprofit entity, prepared its financial statements on an accounting basis prescribed by a regulatory agency solely for filing with that agency. Green audited the financial statements in accordance with generally accepted auditing standards and concluded that the financial statements were fairly presented on the prescribed basis. <br \/>\r<br>Green should issue a:<\/div><input type='hidden' name='question_id[]' id='qID_186' value='25407' \/><input type='hidden' id='answerType25407' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25407[]' id='answer-id-105015' class='answer   answerof-25407 ' value='105015'   \/><label for='answer-id-105015' id='answer-label-105015' class=' answer'><span>Qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25407[]' id='answer-id-105016' class='answer   answerof-25407 ' value='105016'   \/><label for='answer-id-105016' id='answer-label-105016' class=' answer'><span>Standard three paragraph report with reference to footnote disclosure.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25407[]' id='answer-id-105017' class='answer   answerof-25407 ' value='105017'   \/><label for='answer-id-105017' id='answer-label-105017' class=' answer'><span>Disclaimer of opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25407[]' id='answer-id-105018' class='answer   answerof-25407 ' value='105018'   \/><label for='answer-id-105018' id='answer-label-105018' class=' answer'><span>Special report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-187' style=';'><div id='questionWrap-187'  class='   watupro-question-id-25408'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>187. <\/span>An auditor's report would be designated a special report when it is issued in connection with:<\/div><input type='hidden' name='question_id[]' id='qID_187' value='25408' \/><input type='hidden' id='answerType25408' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25408[]' id='answer-id-105019' class='answer   answerof-25408 ' value='105019'   \/><label for='answer-id-105019' id='answer-label-105019' class=' answer'><span>Interim financial information of a publicly held company that is subject to a limited review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25408[]' id='answer-id-105020' class='answer   answerof-25408 ' value='105020'   \/><label for='answer-id-105020' id='answer-label-105020' class=' answer'><span>Compliance with aspects of regulatory requirements related to audited financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25408[]' id='answer-id-105021' class='answer   answerof-25408 ' value='105021'   \/><label for='answer-id-105021' id='answer-label-105021' class=' answer'><span>Application of accounting principles to specified transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25408[]' id='answer-id-105022' class='answer   answerof-25408 ' value='105022'   \/><label for='answer-id-105022' id='answer-label-105022' class=' answer'><span>Limited use prospective financial statements such as a financial projection.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-188' style=';'><div id='questionWrap-188'  class='   watupro-question-id-25409'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>188. <\/span>When a CPA reports on audited financial statements prepared on the cash receipts and disbursements basis of accounting, the report should:<\/div><input type='hidden' name='question_id[]' id='qID_188' value='25409' \/><input type='hidden' id='answerType25409' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25409[]' id='answer-id-105023' class='answer   answerof-25409 ' value='105023'   \/><label for='answer-id-105023' id='answer-label-105023' class=' answer'><span>Explain why this basis of accounting is more useful for the readers of this entity's financial statements than GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25409[]' id='answer-id-105024' class='answer   answerof-25409 ' value='105024'   \/><label for='answer-id-105024' id='answer-label-105024' class=' answer'><span>Refer to the note in the financial statements that describes management's responsibility for the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25409[]' id='answer-id-105025' class='answer   answerof-25409 ' value='105025'   \/><label for='answer-id-105025' id='answer-label-105025' class=' answer'><span>State that the basis of presentation is a comprehensive basis of accounting (OCBOA) other than GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25409[]' id='answer-id-105026' class='answer   answerof-25409 ' value='105026'   \/><label for='answer-id-105026' id='answer-label-105026' class=' answer'><span>Include a separate explanatory paragraph that discusses the justification for, and the CPA's concurrence with, the departure from GAA<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-189' style=';'><div id='questionWrap-189'  class='   watupro-question-id-25410'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>189. <\/span>Which option best describes the level of assurance provided in the following special reports? <br \/>\r<br><br><img decoding=\"async\" width=554 height=231 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image042.jpg\" v:shapes=\"_x0000_i1045\"><br><\/div><input type='hidden' name='question_id[]' id='qID_189' value='25410' \/><input type='hidden' id='answerType25410' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25410[]' id='answer-id-105027' class='answer   answerof-25410 ' value='105027'   \/><label for='answer-id-105027' id='answer-label-105027' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25410[]' id='answer-id-105028' class='answer   answerof-25410 ' value='105028'   \/><label for='answer-id-105028' id='answer-label-105028' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25410[]' id='answer-id-105029' class='answer   answerof-25410 ' value='105029'   \/><label for='answer-id-105029' id='answer-label-105029' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25410[]' id='answer-id-105030' class='answer   answerof-25410 ' value='105030'   \/><label for='answer-id-105030' id='answer-label-105030' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-190' style=';'><div id='questionWrap-190'  class='   watupro-question-id-25411'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>190. <\/span>Which of the following situations would not result in restricted use language being included in an auditor's special report?<\/div><input type='hidden' name='question_id[]' id='qID_190' value='25411' \/><input type='hidden' id='answerType25411' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25411[]' id='answer-id-105031' class='answer   answerof-25411 ' value='105031'   \/><label for='answer-id-105031' id='answer-label-105031' class=' answer'><span>A report on a specified element in a financial statement, where that element is prepared in accordance with the terms specified in a related contract.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25411[]' id='answer-id-105032' class='answer   answerof-25411 ' value='105032'   \/><label for='answer-id-105032' id='answer-label-105032' class=' answer'><span>A report on a client's compliance with a regulatory requirement, assuming the report is prepared based on a financial statement audit of the complete financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25411[]' id='answer-id-105033' class='answer   answerof-25411 ' value='105033'   \/><label for='answer-id-105033' id='answer-label-105033' class=' answer'><span>An &quot;OCBOA&quot; report on financial statements prepared in conformity with requirements established by a regulatory agency, assuming that the auditor's report is a matter of public record.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25411[]' id='answer-id-105034' class='answer   answerof-25411 ' value='105034'   \/><label for='answer-id-105034' id='answer-label-105034' class=' answer'><span>A report on an incomplete financial presentation that is prepared in conformity with GAAP, assuming that the presentation and report will be filed with a regulatory agency and included in a document distributed to the general public.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-191' style=';'><div id='questionWrap-191'  class='   watupro-question-id-25412'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>191. <\/span>Which of the following is true about management representations obtained during an engagement to review the financial statements of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_191' value='25412' \/><input type='hidden' id='answerType25412' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25412[]' id='answer-id-105035' class='answer   answerof-25412 ' value='105035'   \/><label for='answer-id-105035' id='answer-label-105035' class=' answer'><span>Written representations from the current management are required for all periods being reported on.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25412[]' id='answer-id-105036' class='answer   answerof-25412 ' value='105036'   \/><label for='answer-id-105036' id='answer-label-105036' class=' answer'><span>Written representations with respect to prior periods should not be provided by the current management if they were not present during those periods.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25412[]' id='answer-id-105037' class='answer   answerof-25412 ' value='105037'   \/><label for='answer-id-105037' id='answer-label-105037' class=' answer'><span>Written representations should be addressed to members of management whom the accountant believes are responsible for and knowledgeable about the matters covered in the representation letter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25412[]' id='answer-id-105038' class='answer   answerof-25412 ' value='105038'   \/><label for='answer-id-105038' id='answer-label-105038' class=' answer'><span>Written representations need not include information concerning subsequent events.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-192' style=';'><div id='questionWrap-192'  class='   watupro-question-id-25413'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>192. <\/span>In reviewing the financial statements of a nonissuer, an accountant is required to modify the standard review report for which of the following matters? <br \/>\r<br><br><img decoding=\"async\" width=602 height=114 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image044.jpg\" v:shapes=\"_x0000_i1046\"><br><\/div><input type='hidden' name='question_id[]' id='qID_192' value='25413' \/><input type='hidden' id='answerType25413' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25413[]' id='answer-id-105039' class='answer   answerof-25413 ' value='105039'   \/><label for='answer-id-105039' id='answer-label-105039' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25413[]' id='answer-id-105040' class='answer   answerof-25413 ' value='105040'   \/><label for='answer-id-105040' id='answer-label-105040' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25413[]' id='answer-id-105041' class='answer   answerof-25413 ' value='105041'   \/><label for='answer-id-105041' id='answer-label-105041' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25413[]' id='answer-id-105042' class='answer   answerof-25413 ' value='105042'   \/><label for='answer-id-105042' id='answer-label-105042' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-193' style=';'><div id='questionWrap-193'  class='   watupro-question-id-25414'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>193. <\/span>An accountant has compiled the financial statements of a nonissuer but declines to issue a compilation report. <br \/>\r<br>This is an example of:<\/div><input type='hidden' name='question_id[]' id='qID_193' value='25414' \/><input type='hidden' id='answerType25414' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25414[]' id='answer-id-105043' class='answer   answerof-25414 ' value='105043'   \/><label for='answer-id-105043' id='answer-label-105043' class=' answer'><span>An inappropriate reporting decision, because SSARS require that a report be issued whenever an accountant is associated with financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25414[]' id='answer-id-105044' class='answer   answerof-25414 ' value='105044'   \/><label for='answer-id-105044' id='answer-label-105044' class=' answer'><span>An inappropriate reporting decision, if the accountant is not independent with respect to the nonpublic entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25414[]' id='answer-id-105045' class='answer   answerof-25414 ' value='105045'   \/><label for='answer-id-105045' id='answer-label-105045' class=' answer'><span>An appropriate reporting decision, if the compiled financial statements are not expected to be used by a third party.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25414[]' id='answer-id-105046' class='answer   answerof-25414 ' value='105046'   \/><label for='answer-id-105046' id='answer-label-105046' class=' answer'><span>An appropriate reporting decision, as long as the financial statements are prepared in conformity with GAA<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-194' style=';'><div id='questionWrap-194'  class='   watupro-question-id-25415'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>194. <\/span>An accountant compiles unaudited financial statements that are not expected to be used by a third party. <br \/>\r<br>The accountant may decline to issue a compilation report provided: <br \/>\r<br>I. Each page of the financial statements is clearly marked to restrict its use. <br \/>\r<br>II. A written engagement letter is used to document the understanding with the client. <br \/>\r<br>III. A written representation letter is obtained from the client's management. <br \/>\r<br><br><img decoding=\"async\" width=248 height=94 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image046.jpg\" v:shapes=\"_x0000_i1047\"><br><\/div><input type='hidden' name='question_id[]' id='qID_194' value='25415' \/><input type='hidden' id='answerType25415' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25415[]' id='answer-id-105047' class='answer   answerof-25415 ' value='105047'   \/><label for='answer-id-105047' id='answer-label-105047' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25415[]' id='answer-id-105048' class='answer   answerof-25415 ' value='105048'   \/><label for='answer-id-105048' id='answer-label-105048' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25415[]' id='answer-id-105049' class='answer   answerof-25415 ' value='105049'   \/><label for='answer-id-105049' id='answer-label-105049' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25415[]' id='answer-id-105050' class='answer   answerof-25415 ' value='105050'   \/><label for='answer-id-105050' id='answer-label-105050' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-195' style=';'><div id='questionWrap-195'  class='   watupro-question-id-25416'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>195. <\/span>An accountant has compiled the financial statements of a nonissuer in accordance with Statements on Standards for Accounting and Review Services (SSARS). The financial statements are expected to be used by a third party. <br \/>\r<br>Does SSARS require that the compilation report be printed on the accountant's letterhead and that the report be manually signed by the accountant? <br \/>\r<br><br><img decoding=\"async\" width=409 height=115 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image048.jpg\" v:shapes=\"_x0000_i1048\"><br><\/div><input type='hidden' name='question_id[]' id='qID_195' value='25416' \/><input type='hidden' id='answerType25416' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25416[]' id='answer-id-105051' class='answer   answerof-25416 ' value='105051'   \/><label for='answer-id-105051' id='answer-label-105051' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25416[]' id='answer-id-105052' class='answer   answerof-25416 ' value='105052'   \/><label for='answer-id-105052' id='answer-label-105052' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25416[]' id='answer-id-105053' class='answer   answerof-25416 ' value='105053'   \/><label for='answer-id-105053' id='answer-label-105053' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25416[]' id='answer-id-105054' class='answer   answerof-25416 ' value='105054'   \/><label for='answer-id-105054' id='answer-label-105054' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-196' style=';'><div id='questionWrap-196'  class='   watupro-question-id-25417'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>196. <\/span>An accountant is required to comply with the provisions of Statements on Standards for Accounting and Review Services when: <br \/>\r<br>I. Reproducing client-prepared financial statements without modification, as an accommodation to a client. <br \/>\r<br>II. Preparing standard monthly journal entries for depreciation and expiration of prepaid expenses.<\/div><input type='hidden' name='question_id[]' id='qID_196' value='25417' \/><input type='hidden' id='answerType25417' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25417[]' id='answer-id-105055' class='answer   answerof-25417 ' value='105055'   \/><label for='answer-id-105055' id='answer-label-105055' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25417[]' id='answer-id-105056' class='answer   answerof-25417 ' value='105056'   \/><label for='answer-id-105056' id='answer-label-105056' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25417[]' id='answer-id-105057' class='answer   answerof-25417 ' value='105057'   \/><label for='answer-id-105057' id='answer-label-105057' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25417[]' id='answer-id-105058' class='answer   answerof-25417 ' value='105058'   \/><label for='answer-id-105058' id='answer-label-105058' class=' answer'><span>Neither I nor I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-197' style=';'><div id='questionWrap-197'  class='   watupro-question-id-25418'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>197. <\/span>If requested to perform a review engagement for a nonissuer in which an accountant has an immaterial direct financial interest, the accountant is:<\/div><input type='hidden' name='question_id[]' id='qID_197' value='25418' \/><input type='hidden' id='answerType25418' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25418[]' id='answer-id-105059' class='answer   answerof-25418 ' value='105059'   \/><label for='answer-id-105059' id='answer-label-105059' class=' answer'><span>Not independent and, therefore, may not be associated with the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25418[]' id='answer-id-105060' class='answer   answerof-25418 ' value='105060'   \/><label for='answer-id-105060' id='answer-label-105060' class=' answer'><span>Not independent and, therefore, may not issue a review report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25418[]' id='answer-id-105061' class='answer   answerof-25418 ' value='105061'   \/><label for='answer-id-105061' id='answer-label-105061' class=' answer'><span>Not independent and, therefore, may issue a review report, but may not issue an auditor's opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25418[]' id='answer-id-105062' class='answer   answerof-25418 ' value='105062'   \/><label for='answer-id-105062' id='answer-label-105062' class=' answer'><span>Independent because the financial interest is immaterial and, therefore, may issue a review report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-198' style=';'><div id='questionWrap-198'  class='   watupro-question-id-25419'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>198. <\/span>Kell engaged March, CPA, to submit to Kell a written personal financial plan containing unaudited personal financial statements. March anticipates omitting certain disclosures required by GAAP because the engagement's sole purpose is to assist Kell in developing a personal financial plan. <br \/>\r<br>For March to be exempt from complying with the requirements of SSARS 1, Compilation and Review of Financial Statements, Kell is required to agree that the:<\/div><input type='hidden' name='question_id[]' id='qID_198' value='25419' \/><input type='hidden' id='answerType25419' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25419[]' id='answer-id-105063' class='answer   answerof-25419 ' value='105063'   \/><label for='answer-id-105063' id='answer-label-105063' class=' answer'><span>Financial statements will not be presented in comparative form with those of the prior period.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25419[]' id='answer-id-105064' class='answer   answerof-25419 ' value='105064'   \/><label for='answer-id-105064' id='answer-label-105064' class=' answer'><span>Omitted disclosures required by GAAP are not material.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25419[]' id='answer-id-105065' class='answer   answerof-25419 ' value='105065'   \/><label for='answer-id-105065' id='answer-label-105065' class=' answer'><span>Financial statements will not be disclosed to a non-CPA financial planner.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25419[]' id='answer-id-105066' class='answer   answerof-25419 ' value='105066'   \/><label for='answer-id-105066' id='answer-label-105066' class=' answer'><span>Financial statements will not be used to obtain credit.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-199' style=';'><div id='questionWrap-199'  class='   watupro-question-id-25420'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>199. <\/span>When providing limited assurance that the financial statements of a nonissuer require no material modifications to be in accordance with generally accepted accounting principles, the accountant should:<\/div><input type='hidden' name='question_id[]' id='qID_199' value='25420' \/><input type='hidden' id='answerType25420' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25420[]' id='answer-id-105067' class='answer   answerof-25420 ' value='105067'   \/><label for='answer-id-105067' id='answer-label-105067' class=' answer'><span>Assess the risk that a material misstatement could occur in a financial statement assertion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25420[]' id='answer-id-105068' class='answer   answerof-25420 ' value='105068'   \/><label for='answer-id-105068' id='answer-label-105068' class=' answer'><span>Confirm with the entity's lawyer that material loss contingencies are disclosed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25420[]' id='answer-id-105069' class='answer   answerof-25420 ' value='105069'   \/><label for='answer-id-105069' id='answer-label-105069' class=' answer'><span>Understand the accounting principles of the industry in which the entity operates.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25420[]' id='answer-id-105070' class='answer   answerof-25420 ' value='105070'   \/><label for='answer-id-105070' id='answer-label-105070' class=' answer'><span>Develop audit programs to determine whether the entity's financial statements are fairly presented.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-200' style=';'><div id='questionWrap-200'  class='   watupro-question-id-25421'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>200. <\/span>What type of analytical procedure would an auditor most likely use in developing relationships among balance sheet accounts when reviewing the financial statements of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_200' value='25421' \/><input type='hidden' id='answerType25421' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25421[]' id='answer-id-105071' class='answer   answerof-25421 ' value='105071'   \/><label for='answer-id-105071' id='answer-label-105071' class=' answer'><span>Trend analysis.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25421[]' id='answer-id-105072' class='answer   answerof-25421 ' value='105072'   \/><label for='answer-id-105072' id='answer-label-105072' class=' answer'><span>Regression analysis.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25421[]' id='answer-id-105073' class='answer   answerof-25421 ' value='105073'   \/><label for='answer-id-105073' id='answer-label-105073' class=' answer'><span>Ratio analysis.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25421[]' id='answer-id-105074' class='answer   answerof-25421 ' value='105074'   \/><label for='answer-id-105074' id='answer-label-105074' class=' answer'><span>Risk analysis.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-201' style=';'><div id='questionWrap-201'  class='   watupro-question-id-25422'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>201. <\/span>Compiled financial statements should be accompanied by an accountant's report stating that:<\/div><input type='hidden' name='question_id[]' id='qID_201' value='25422' \/><input type='hidden' id='answerType25422' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25422[]' id='answer-id-105075' class='answer   answerof-25422 ' value='105075'   \/><label for='answer-id-105075' id='answer-label-105075' class=' answer'><span>A compilation includes assessing the accounting principles used and significant management estimates, as well as evaluating the overall financial statement presentation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25422[]' id='answer-id-105076' class='answer   answerof-25422 ' value='105076'   \/><label for='answer-id-105076' id='answer-label-105076' class=' answer'><span>The accountant compiled the financial statements in accordance with Statements on Standards for Accounting and Review Services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25422[]' id='answer-id-105077' class='answer   answerof-25422 ' value='105077'   \/><label for='answer-id-105077' id='answer-label-105077' class=' answer'><span>A compilation is substantially less in scope than an audit in accordance with GAAS, the objective of which is the expression of an opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25422[]' id='answer-id-105078' class='answer   answerof-25422 ' value='105078'   \/><label for='answer-id-105078' id='answer-label-105078' class=' answer'><span>The accountant is not aware of any material modifications that should be made to the financial statements to conform with GAA<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-202' style=';'><div id='questionWrap-202'  class='   watupro-question-id-25423'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>202. <\/span>Moore, CPA, has been asked to issue a review report on the balance sheet of Dover Co., a nonissuer. Moore will not be reporting on Dover's statements of income, retained earnings, and cash flows. <br \/>\r<br>Moore may issue the review report provided the:<\/div><input type='hidden' name='question_id[]' id='qID_202' value='25423' \/><input type='hidden' id='answerType25423' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25423[]' id='answer-id-105079' class='answer   answerof-25423 ' value='105079'   \/><label for='answer-id-105079' id='answer-label-105079' class=' answer'><span>Balance sheet is presented in a prescribed form of an industry trade association.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25423[]' id='answer-id-105080' class='answer   answerof-25423 ' value='105080'   \/><label for='answer-id-105080' id='answer-label-105080' class=' answer'><span>Scope of the inquiry and analytical procedures has not been restricted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25423[]' id='answer-id-105081' class='answer   answerof-25423 ' value='105081'   \/><label for='answer-id-105081' id='answer-label-105081' class=' answer'><span>Balance sheet is not to be used to obtain credit or distributed to creditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25423[]' id='answer-id-105082' class='answer   answerof-25423 ' value='105082'   \/><label for='answer-id-105082' id='answer-label-105082' class=' answer'><span>Specialized accounting principles and practices of Dover's industry are disclosed.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-203' style=';'><div id='questionWrap-203'  class='   watupro-question-id-25424'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>203. <\/span>Baker, CPA, was engaged to review the financial statements of Hall Co., a nonissuer. During the engagement Baker uncovered a complex scheme involving client illegal acts and fraud that materially affect Hall's financial statements. <br \/>\r<br>If Baker believes that modification of the standard review report is not adequate to indicate the deficiencies in the financial statements, Baker should:<\/div><input type='hidden' name='question_id[]' id='qID_203' value='25424' \/><input type='hidden' id='answerType25424' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25424[]' id='answer-id-105083' class='answer   answerof-25424 ' value='105083'   \/><label for='answer-id-105083' id='answer-label-105083' class=' answer'><span>Disclaim an opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25424[]' id='answer-id-105084' class='answer   answerof-25424 ' value='105084'   \/><label for='answer-id-105084' id='answer-label-105084' class=' answer'><span>Issue an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25424[]' id='answer-id-105085' class='answer   answerof-25424 ' value='105085'   \/><label for='answer-id-105085' id='answer-label-105085' class=' answer'><span>Withdraw from the engagement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25424[]' id='answer-id-105086' class='answer   answerof-25424 ' value='105086'   \/><label for='answer-id-105086' id='answer-label-105086' class=' answer'><span>Issue a qualified opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-204' style=';'><div id='questionWrap-204'  class='   watupro-question-id-25425'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>204. <\/span>Each page of a nonissuer's financial statements reviewed by an accountant should include the following reference:<\/div><input type='hidden' name='question_id[]' id='qID_204' value='25425' \/><input type='hidden' id='answerType25425' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25425[]' id='answer-id-105087' class='answer   answerof-25425 ' value='105087'   \/><label for='answer-id-105087' id='answer-label-105087' class=' answer'><span>See Accompanying Accountant's Footnotes.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25425[]' id='answer-id-105088' class='answer   answerof-25425 ' value='105088'   \/><label for='answer-id-105088' id='answer-label-105088' class=' answer'><span>Reviewed, No Material Modifications Required.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25425[]' id='answer-id-105089' class='answer   answerof-25425 ' value='105089'   \/><label for='answer-id-105089' id='answer-label-105089' class=' answer'><span>See Accountant's Review Report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25425[]' id='answer-id-105090' class='answer   answerof-25425 ' value='105090'   \/><label for='answer-id-105090' id='answer-label-105090' class=' answer'><span>Reviewed, No Accountant's Assurance Expressed.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-205' style=';'><div id='questionWrap-205'  class='   watupro-question-id-25426'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>205. <\/span>An accountant has been engaged to review a nonissuer's financial statements that contain several departures from GAAP. <br \/>\r<br>If the financial statements are not revised and modification of the standard review report is not adequate to indicate the deficiencies, the accountant should:<\/div><input type='hidden' name='question_id[]' id='qID_205' value='25426' \/><input type='hidden' id='answerType25426' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25426[]' id='answer-id-105091' class='answer   answerof-25426 ' value='105091'   \/><label for='answer-id-105091' id='answer-label-105091' class=' answer'><span>Withdraw from the engagement and provide no further services concerning these financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25426[]' id='answer-id-105092' class='answer   answerof-25426 ' value='105092'   \/><label for='answer-id-105092' id='answer-label-105092' class=' answer'><span>Inform management that the engagement can proceed only if the accountant's report is restricted to internal use.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25426[]' id='answer-id-105093' class='answer   answerof-25426 ' value='105093'   \/><label for='answer-id-105093' id='answer-label-105093' class=' answer'><span>Determine the effects of the departures from GAAP and issue a special report on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25426[]' id='answer-id-105094' class='answer   answerof-25426 ' value='105094'   \/><label for='answer-id-105094' id='answer-label-105094' class=' answer'><span>Issue a modified review report provided the entity agrees that the financial statements will not be used to obtain credit.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-206' style=';'><div id='questionWrap-206'  class='   watupro-question-id-25427'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>206. <\/span>Statements on Standards for Accounting and Review Services (SSARS) require an accountant to report when the accountant has:<\/div><input type='hidden' name='question_id[]' id='qID_206' value='25427' \/><input type='hidden' id='answerType25427' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25427[]' id='answer-id-105095' class='answer   answerof-25427 ' value='105095'   \/><label for='answer-id-105095' id='answer-label-105095' class=' answer'><span>Typed client-prepared financial statements, without modification, as an accommodation to the client.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25427[]' id='answer-id-105096' class='answer   answerof-25427 ' value='105096'   \/><label for='answer-id-105096' id='answer-label-105096' class=' answer'><span>Provided a client with a financial statement format that does not include dollar amounts, to be used by the client in preparing financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25427[]' id='answer-id-105097' class='answer   answerof-25427 ' value='105097'   \/><label for='answer-id-105097' id='answer-label-105097' class=' answer'><span>Proposed correcting journal entries to be recorded by the client that change client-prepared financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25427[]' id='answer-id-105098' class='answer   answerof-25427 ' value='105098'   \/><label for='answer-id-105098' id='answer-label-105098' class=' answer'><span>Prepared, through the use of computer software, financial statements that are in conformity with a comprehensive basis of accounting other than GAAP, and which are expected to be used by a third party.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-207' style=';'><div id='questionWrap-207'  class='   watupro-question-id-25428'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>207. <\/span>Which of the following procedures should an accountant perform during an engagement to review the financial statements of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_207' value='25428' \/><input type='hidden' id='answerType25428' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25428[]' id='answer-id-105099' class='answer   answerof-25428 ' value='105099'   \/><label for='answer-id-105099' id='answer-label-105099' class=' answer'><span>Communicating significant deficiencies discovered during the assessment of control risk.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25428[]' id='answer-id-105100' class='answer   answerof-25428 ' value='105100'   \/><label for='answer-id-105100' id='answer-label-105100' class=' answer'><span>Obtaining a client representation letter from members of management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25428[]' id='answer-id-105101' class='answer   answerof-25428 ' value='105101'   \/><label for='answer-id-105101' id='answer-label-105101' class=' answer'><span>Sending bank confirmation letters to the entity's financial institutions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25428[]' id='answer-id-105102' class='answer   answerof-25428 ' value='105102'   \/><label for='answer-id-105102' id='answer-label-105102' class=' answer'><span>Examining cash disbursements in the subsequent period for unrecorded liabilities.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-208' style=';'><div id='questionWrap-208'  class='   watupro-question-id-25429'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>208. <\/span>An accountant who had begun an audit of the financial statements of a nonissuer was asked to change the engagement to a review because of a restriction on the scope of the audit. <br \/>\r<br>If there is reasonable justification for the change, the accountant's review report should include reference to the: <br \/>\r<br><br><img decoding=\"async\" width=497 height=118 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image050.jpg\" v:shapes=\"_x0000_i1049\"><br><\/div><input type='hidden' name='question_id[]' id='qID_208' value='25429' \/><input type='hidden' id='answerType25429' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25429[]' id='answer-id-105103' class='answer   answerof-25429 ' value='105103'   \/><label for='answer-id-105103' id='answer-label-105103' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25429[]' id='answer-id-105104' class='answer   answerof-25429 ' value='105104'   \/><label for='answer-id-105104' id='answer-label-105104' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25429[]' id='answer-id-105105' class='answer   answerof-25429 ' value='105105'   \/><label for='answer-id-105105' id='answer-label-105105' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25429[]' id='answer-id-105106' class='answer   answerof-25429 ' value='105106'   \/><label for='answer-id-105106' id='answer-label-105106' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-209' style=';'><div id='questionWrap-209'  class='   watupro-question-id-25430'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>209. <\/span>Which of the following statements should be included in an accountant's standard report based on the compilation of a nonissuer's financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_209' value='25430' \/><input type='hidden' id='answerType25430' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25430[]' id='answer-id-105107' class='answer   answerof-25430 ' value='105107'   \/><label for='answer-id-105107' id='answer-label-105107' class=' answer'><span>A compilation consists principally of inquiries of company personnel and analytical procedures applied to financial data.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25430[]' id='answer-id-105108' class='answer   answerof-25430 ' value='105108'   \/><label for='answer-id-105108' id='answer-label-105108' class=' answer'><span>A compilation is limited to presenting in the form of financial statements information that is the representation of management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25430[]' id='answer-id-105109' class='answer   answerof-25430 ' value='105109'   \/><label for='answer-id-105109' id='answer-label-105109' class=' answer'><span>A compilation is not designed to detect material modifications that should be made to the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25430[]' id='answer-id-105110' class='answer   answerof-25430 ' value='105110'   \/><label for='answer-id-105110' id='answer-label-105110' class=' answer'><span>A compilation is substantially less in scope than an audit in accordance with generally accepted auditing standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-210' style=';'><div id='questionWrap-210'  class='   watupro-question-id-25431'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>210. <\/span>Miller, CPA, is engaged to compile the financial statements of Web Co., a nonissuer, in conformity with the income tax basis of accounting. <br \/>\r<br>If Web's financial statements do not disclose the basis of accounting used, Miller should:<\/div><input type='hidden' name='question_id[]' id='qID_210' value='25431' \/><input type='hidden' id='answerType25431' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25431[]' id='answer-id-105111' class='answer   answerof-25431 ' value='105111'   \/><label for='answer-id-105111' id='answer-label-105111' class=' answer'><span>Disclose the basis of accounting in the accountant's compilation report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25431[]' id='answer-id-105112' class='answer   answerof-25431 ' value='105112'   \/><label for='answer-id-105112' id='answer-label-105112' class=' answer'><span>Clearly label each page &quot;Distribution Restricted-Material Modifications Required.&quot;<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25431[]' id='answer-id-105113' class='answer   answerof-25431 ' value='105113'   \/><label for='answer-id-105113' id='answer-label-105113' class=' answer'><span>Issue a special report describing the effect of the incomplete presentation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25431[]' id='answer-id-105114' class='answer   answerof-25431 ' value='105114'   \/><label for='answer-id-105114' id='answer-label-105114' class=' answer'><span>Withdraw from the engagement and provide no further services to Web.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-211' style=';'><div id='questionWrap-211'  class='   watupro-question-id-25432'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>211. <\/span>When an accountant is engaged to compile a nonissuer's financial statements that omit substantially all disclosures required by GAAP, the accountant should indicate in the compilation report that the financial statements are:<\/div><input type='hidden' name='question_id[]' id='qID_211' value='25432' \/><input type='hidden' id='answerType25432' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25432[]' id='answer-id-105115' class='answer   answerof-25432 ' value='105115'   \/><label for='answer-id-105115' id='answer-label-105115' class=' answer'><span>Not designed for those who are uninformed about the omitted disclosures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25432[]' id='answer-id-105116' class='answer   answerof-25432 ' value='105116'   \/><label for='answer-id-105116' id='answer-label-105116' class=' answer'><span>Prepared in conformity with a comprehensive basis of accounting other than GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25432[]' id='answer-id-105117' class='answer   answerof-25432 ' value='105117'   \/><label for='answer-id-105117' id='answer-label-105117' class=' answer'><span>Not compiled in accordance with Statements on Standards for Accounting and Review Services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25432[]' id='answer-id-105118' class='answer   answerof-25432 ' value='105118'   \/><label for='answer-id-105118' id='answer-label-105118' class=' answer'><span>Special-purpose financial statements that are not comparable to those of prior periods.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-212' style=';'><div id='questionWrap-212'  class='   watupro-question-id-25433'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>212. <\/span>North Co., a privately-held entity, asked its tax accountant, King, a CPA in public practice, to prepare North's interim financial statements on King's microcomputer when King prepared North's quarterly tax return. <br \/>\r<br>King should not submit these financial statements to North unless, as a minimum, King complies with the provisions of:<\/div><input type='hidden' name='question_id[]' id='qID_212' value='25433' \/><input type='hidden' id='answerType25433' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25433[]' id='answer-id-105119' class='answer   answerof-25433 ' value='105119'   \/><label for='answer-id-105119' id='answer-label-105119' class=' answer'><span>Statements on Standards for Accounting and Review Services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25433[]' id='answer-id-105120' class='answer   answerof-25433 ' value='105120'   \/><label for='answer-id-105120' id='answer-label-105120' class=' answer'><span>Statements on Standards for Unaudited Financial Services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25433[]' id='answer-id-105121' class='answer   answerof-25433 ' value='105121'   \/><label for='answer-id-105121' id='answer-label-105121' class=' answer'><span>Statements on Standards for Consulting Services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25433[]' id='answer-id-105122' class='answer   answerof-25433 ' value='105122'   \/><label for='answer-id-105122' id='answer-label-105122' class=' answer'><span>Statements on Standards for Attestation Engagements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-213' style=';'><div id='questionWrap-213'  class='   watupro-question-id-25434'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>213. <\/span>Davis, CPA, accepted an engagement to audit the financial statements of Tech Resources, a nonissuer. Before the completion of the audit, Tech requested Davis to change the engagement to a compilation of financial statements. <br \/>\r<br>Before Davis agrees to change the engagement, Davis is required to consider the: <br \/>\r<br><br><img decoding=\"async\" width=481 height=114 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image052.jpg\" v:shapes=\"_x0000_i1050\"><br><\/div><input type='hidden' name='question_id[]' id='qID_213' value='25434' \/><input type='hidden' id='answerType25434' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25434[]' id='answer-id-105123' class='answer   answerof-25434 ' value='105123'   \/><label for='answer-id-105123' id='answer-label-105123' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25434[]' id='answer-id-105124' class='answer   answerof-25434 ' value='105124'   \/><label for='answer-id-105124' id='answer-label-105124' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25434[]' id='answer-id-105125' class='answer   answerof-25434 ' value='105125'   \/><label for='answer-id-105125' id='answer-label-105125' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25434[]' id='answer-id-105126' class='answer   answerof-25434 ' value='105126'   \/><label for='answer-id-105126' id='answer-label-105126' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-214' style=';'><div id='questionWrap-214'  class='   watupro-question-id-25435'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>214. <\/span>Smith, CPA, has been asked to issue a review report on the balance sheet of Cone Company, a nonissuer, and not on the other related financial statements. <br \/>\r<br>Smith may do so only if:<\/div><input type='hidden' name='question_id[]' id='qID_214' value='25435' \/><input type='hidden' id='answerType25435' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25435[]' id='answer-id-105127' class='answer   answerof-25435 ' value='105127'   \/><label for='answer-id-105127' id='answer-label-105127' class=' answer'><span>Smith compiles and reports on the related statements of income, retained earnings, and cash flows.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25435[]' id='answer-id-105128' class='answer   answerof-25435 ' value='105128'   \/><label for='answer-id-105128' id='answer-label-105128' class=' answer'><span>Smith is not aware of any material modifications needed for the balance sheet to conform with GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25435[]' id='answer-id-105129' class='answer   answerof-25435 ' value='105129'   \/><label for='answer-id-105129' id='answer-label-105129' class=' answer'><span>The scope of Smith's inquiry and analytical procedures is not restricted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25435[]' id='answer-id-105130' class='answer   answerof-25435 ' value='105130'   \/><label for='answer-id-105130' id='answer-label-105130' class=' answer'><span>Cone is a new client and Smith accepts the engagement after the end of Cone's fiscal year.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-215' style=';'><div id='questionWrap-215'  class='   watupro-question-id-25436'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>215. <\/span>May an accountant accept an engagement to compile or review the financial statements of a not-for-profit entity if the accountant is unfamiliar with the specialized industry accounting principles, but plans to obtain the required level of knowledge before compiling or reviewing the financial statements? <br \/>\r<br><br><img decoding=\"async\" width=236 height=95 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image054.jpg\" v:shapes=\"_x0000_i1051\"><br><\/div><input type='hidden' name='question_id[]' id='qID_215' value='25436' \/><input type='hidden' id='answerType25436' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25436[]' id='answer-id-105131' class='answer   answerof-25436 ' value='105131'   \/><label for='answer-id-105131' id='answer-label-105131' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25436[]' id='answer-id-105132' class='answer   answerof-25436 ' value='105132'   \/><label for='answer-id-105132' id='answer-label-105132' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25436[]' id='answer-id-105133' class='answer   answerof-25436 ' value='105133'   \/><label for='answer-id-105133' id='answer-label-105133' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25436[]' id='answer-id-105134' class='answer   answerof-25436 ' value='105134'   \/><label for='answer-id-105134' id='answer-label-105134' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-216' style=';'><div id='questionWrap-216'  class='   watupro-question-id-25437'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>216. <\/span>An accountant should perform analytical procedures during an engagement to: <br \/>\r<br><br><img decoding=\"async\" width=418 height=118 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image056.jpg\" v:shapes=\"_x0000_i1052\"><br><\/div><input type='hidden' name='question_id[]' id='qID_216' value='25437' \/><input type='hidden' id='answerType25437' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25437[]' id='answer-id-105135' class='answer   answerof-25437 ' value='105135'   \/><label for='answer-id-105135' id='answer-label-105135' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25437[]' id='answer-id-105136' class='answer   answerof-25437 ' value='105136'   \/><label for='answer-id-105136' id='answer-label-105136' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25437[]' id='answer-id-105137' class='answer   answerof-25437 ' value='105137'   \/><label for='answer-id-105137' id='answer-label-105137' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25437[]' id='answer-id-105138' class='answer   answerof-25437 ' value='105138'   \/><label for='answer-id-105138' id='answer-label-105138' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-217' style=';'><div id='questionWrap-217'  class='   watupro-question-id-25438'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>217. <\/span>Which of the following procedures most likely would not be included in a review engagement of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_217' value='25438' \/><input type='hidden' id='answerType25438' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25438[]' id='answer-id-105139' class='answer   answerof-25438 ' value='105139'   \/><label for='answer-id-105139' id='answer-label-105139' class=' answer'><span>Obtaining a management representation letter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25438[]' id='answer-id-105140' class='answer   answerof-25438 ' value='105140'   \/><label for='answer-id-105140' id='answer-label-105140' class=' answer'><span>Considering whether the financial statements conform with GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25438[]' id='answer-id-105141' class='answer   answerof-25438 ' value='105141'   \/><label for='answer-id-105141' id='answer-label-105141' class=' answer'><span>Assessing control risk.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25438[]' id='answer-id-105142' class='answer   answerof-25438 ' value='105142'   \/><label for='answer-id-105142' id='answer-label-105142' class=' answer'><span>Inquiring about subsequent events.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-218' style=';'><div id='questionWrap-218'  class='   watupro-question-id-25439'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>218. <\/span>Compiled financial statements should be accompanied by a report stating that:<\/div><input type='hidden' name='question_id[]' id='qID_218' value='25439' \/><input type='hidden' id='answerType25439' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25439[]' id='answer-id-105143' class='answer   answerof-25439 ' value='105143'   \/><label for='answer-id-105143' id='answer-label-105143' class=' answer'><span>A compilation is substantially less in scope than a review or an audit in accordance with generally accepted auditing standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25439[]' id='answer-id-105144' class='answer   answerof-25439 ' value='105144'   \/><label for='answer-id-105144' id='answer-label-105144' class=' answer'><span>The accountant does not express an opinion but expresses only limited assurance on the compiled financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25439[]' id='answer-id-105145' class='answer   answerof-25439 ' value='105145'   \/><label for='answer-id-105145' id='answer-label-105145' class=' answer'><span>A compilation is limited to presenting in the form of financial statements information that is the representation of management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25439[]' id='answer-id-105146' class='answer   answerof-25439 ' value='105146'   \/><label for='answer-id-105146' id='answer-label-105146' class=' answer'><span>The accountant has compiled the financial statements in accordance with standards established by the Auditing Standards Board.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-219' style=';'><div id='questionWrap-219'  class='   watupro-question-id-25440'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>219. <\/span>An accountant may compile a nonissuer's financial statements that omit all of the disclosures required by GAAP only if the omission is: <br \/>\r<br>I. Clearly indicated in the accountant's report. <br \/>\r<br>II. Not undertaken with the intention of misleading the financial statement users.<\/div><input type='hidden' name='question_id[]' id='qID_219' value='25440' \/><input type='hidden' id='answerType25440' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25440[]' id='answer-id-105147' class='answer   answerof-25440 ' value='105147'   \/><label for='answer-id-105147' id='answer-label-105147' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25440[]' id='answer-id-105148' class='answer   answerof-25440 ' value='105148'   \/><label for='answer-id-105148' id='answer-label-105148' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25440[]' id='answer-id-105149' class='answer   answerof-25440 ' value='105149'   \/><label for='answer-id-105149' id='answer-label-105149' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25440[]' id='answer-id-105150' class='answer   answerof-25440 ' value='105150'   \/><label for='answer-id-105150' id='answer-label-105150' class=' answer'><span>Either I or I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-220' style=';'><div id='questionWrap-220'  class='   watupro-question-id-25441'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>220. <\/span>An accountant's standard report on a review of the financial statements of a nonissuer should state that the accountant:<\/div><input type='hidden' name='question_id[]' id='qID_220' value='25441' \/><input type='hidden' id='answerType25441' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25441[]' id='answer-id-105151' class='answer   answerof-25441 ' value='105151'   \/><label for='answer-id-105151' id='answer-label-105151' class=' answer'><span>Does not express an opinion or any form of limited assurance on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25441[]' id='answer-id-105152' class='answer   answerof-25441 ' value='105152'   \/><label for='answer-id-105152' id='answer-label-105152' class=' answer'><span>Is not aware of any material modifications that should be made to the financial statements for them to conform with GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25441[]' id='answer-id-105153' class='answer   answerof-25441 ' value='105153'   \/><label for='answer-id-105153' id='answer-label-105153' class=' answer'><span>Obtained reasonable assurance about whether the financial statements are free of material misstatement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25441[]' id='answer-id-105154' class='answer   answerof-25441 ' value='105154'   \/><label for='answer-id-105154' id='answer-label-105154' class=' answer'><span>Examined evidence, on a test basis, supporting the amounts and disclosures in the financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-221' style=';'><div id='questionWrap-221'  class='   watupro-question-id-25442'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>221. <\/span>An accountant has been asked to issue a review report on the balance sheet of a nonissuer but not to report on the other basic financial statements. <br \/>\r<br>The accountant may not do so:<\/div><input type='hidden' name='question_id[]' id='qID_221' value='25442' \/><input type='hidden' id='answerType25442' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25442[]' id='answer-id-105155' class='answer   answerof-25442 ' value='105155'   \/><label for='answer-id-105155' id='answer-label-105155' class=' answer'><span>Because compliance with this request would result in a violation of the ethical standards of the profession.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25442[]' id='answer-id-105156' class='answer   answerof-25442 ' value='105156'   \/><label for='answer-id-105156' id='answer-label-105156' class=' answer'><span>Because compliance with this request would result in an incomplete review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25442[]' id='answer-id-105157' class='answer   answerof-25442 ' value='105157'   \/><label for='answer-id-105157' id='answer-label-105157' class=' answer'><span>If the review of the balance sheet discloses material departures from GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25442[]' id='answer-id-105158' class='answer   answerof-25442 ' value='105158'   \/><label for='answer-id-105158' id='answer-label-105158' class=' answer'><span>If the scope of the inquiry and analytical procedures has been restricted.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-222' style=';'><div id='questionWrap-222'  class='   watupro-question-id-25443'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>222. <\/span>When performing an engagement to review a nonissuer's financial statements, an accountant most likely would:<\/div><input type='hidden' name='question_id[]' id='qID_222' value='25443' \/><input type='hidden' id='answerType25443' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25443[]' id='answer-id-105159' class='answer   answerof-25443 ' value='105159'   \/><label for='answer-id-105159' id='answer-label-105159' class=' answer'><span>Confirm a sample of significant accounts receivable balances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25443[]' id='answer-id-105160' class='answer   answerof-25443 ' value='105160'   \/><label for='answer-id-105160' id='answer-label-105160' class=' answer'><span>Ask about actions taken at board of directors' meetings.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25443[]' id='answer-id-105161' class='answer   answerof-25443 ' value='105161'   \/><label for='answer-id-105161' id='answer-label-105161' class=' answer'><span>Obtain an understanding of internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25443[]' id='answer-id-105162' class='answer   answerof-25443 ' value='105162'   \/><label for='answer-id-105162' id='answer-label-105162' class=' answer'><span>Restrict the use of the accountant's report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-223' style=';'><div id='questionWrap-223'  class='   watupro-question-id-25444'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>223. <\/span>During an engagement to review the financial statements of a nonissuer an accountant becomes aware of a material departure from GAAP. <br \/>\r<br>If the accountant decides to modify the standard review report because management will not revise the financial statements, the accountant should:<\/div><input type='hidden' name='question_id[]' id='qID_223' value='25444' \/><input type='hidden' id='answerType25444' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25444[]' id='answer-id-105163' class='answer   answerof-25444 ' value='105163'   \/><label for='answer-id-105163' id='answer-label-105163' class=' answer'><span>Express negative assurance on the accounting principles that do not conform with GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25444[]' id='answer-id-105164' class='answer   answerof-25444 ' value='105164'   \/><label for='answer-id-105164' id='answer-label-105164' class=' answer'><span>Disclose the departure from GAAP in a separate paragraph of the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25444[]' id='answer-id-105165' class='answer   answerof-25444 ' value='105165'   \/><label for='answer-id-105165' id='answer-label-105165' class=' answer'><span>Issue an adverse or an &quot;except for&quot; qualified opinion, depending on materiality.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25444[]' id='answer-id-105166' class='answer   answerof-25444 ' value='105166'   \/><label for='answer-id-105166' id='answer-label-105166' class=' answer'><span>Express positive assurance on the accounting principles that conform with GAA<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-224' style=';'><div id='questionWrap-224'  class='   watupro-question-id-25445'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>224. <\/span>Which of the following representations does an accountant make implicitly when issuing the standard report for the compilation of a nonissuer's financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_224' value='25445' \/><input type='hidden' id='answerType25445' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25445[]' id='answer-id-105167' class='answer   answerof-25445 ' value='105167'   \/><label for='answer-id-105167' id='answer-label-105167' class=' answer'><span>The accountant is independent with respect to the entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25445[]' id='answer-id-105168' class='answer   answerof-25445 ' value='105168'   \/><label for='answer-id-105168' id='answer-label-105168' class=' answer'><span>The financial statements have not been audited.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25445[]' id='answer-id-105169' class='answer   answerof-25445 ' value='105169'   \/><label for='answer-id-105169' id='answer-label-105169' class=' answer'><span>A compilation consists principally of inquiries and analytical procedures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25445[]' id='answer-id-105170' class='answer   answerof-25445 ' value='105170'   \/><label for='answer-id-105170' id='answer-label-105170' class=' answer'><span>The accountant does not express any assurance on the financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-225' style=';'><div id='questionWrap-225'  class='   watupro-question-id-25446'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>225. <\/span>Which of the following accounting services may an accountant perform without being required to issue a compilation or review report under the Statements on Standards for Accounting and Review Services? <br \/>\r<br>I. Preparing a working trial balance. <br \/>\r<br>II. Preparing standard monthly journal entries.<\/div><input type='hidden' name='question_id[]' id='qID_225' value='25446' \/><input type='hidden' id='answerType25446' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25446[]' id='answer-id-105171' class='answer   answerof-25446 ' value='105171'   \/><label for='answer-id-105171' id='answer-label-105171' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25446[]' id='answer-id-105172' class='answer   answerof-25446 ' value='105172'   \/><label for='answer-id-105172' id='answer-label-105172' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25446[]' id='answer-id-105173' class='answer   answerof-25446 ' value='105173'   \/><label for='answer-id-105173' id='answer-label-105173' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25446[]' id='answer-id-105174' class='answer   answerof-25446 ' value='105174'   \/><label for='answer-id-105174' id='answer-label-105174' class=' answer'><span>Neither I nor I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-226' style=';'><div id='questionWrap-226'  class='   watupro-question-id-25447'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>226. <\/span>Which of the following inquiry or analytical procedures ordinarily is performed in an engagement to review a nonissuer's financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_226' value='25447' \/><input type='hidden' id='answerType25447' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25447[]' id='answer-id-105175' class='answer   answerof-25447 ' value='105175'   \/><label for='answer-id-105175' id='answer-label-105175' class=' answer'><span>Analytical procedures designed to test the accounting records by obtaining corroborating evidential matter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25447[]' id='answer-id-105176' class='answer   answerof-25447 ' value='105176'   \/><label for='answer-id-105176' id='answer-label-105176' class=' answer'><span>Inquiries concerning the entity's procedures for recording and summarizing transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25447[]' id='answer-id-105177' class='answer   answerof-25447 ' value='105177'   \/><label for='answer-id-105177' id='answer-label-105177' class=' answer'><span>Analytical procedures designed to test management's assertions regarding continued existence.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25447[]' id='answer-id-105178' class='answer   answerof-25447 ' value='105178'   \/><label for='answer-id-105178' id='answer-label-105178' class=' answer'><span>Inquiries of the entity's attorney concerning contingent liabilities.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-227' style=';'><div id='questionWrap-227'  class='   watupro-question-id-25448'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>227. <\/span>When compiling the financial statements of a nonissuer, an accountant should:<\/div><input type='hidden' name='question_id[]' id='qID_227' value='25448' \/><input type='hidden' id='answerType25448' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25448[]' id='answer-id-105179' class='answer   answerof-25448 ' value='105179'   \/><label for='answer-id-105179' id='answer-label-105179' class=' answer'><span>Review agreements with financial institutions for restrictions on cash balances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25448[]' id='answer-id-105180' class='answer   answerof-25448 ' value='105180'   \/><label for='answer-id-105180' id='answer-label-105180' class=' answer'><span>Understand the accounting principles and practices of the entity's industry.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25448[]' id='answer-id-105181' class='answer   answerof-25448 ' value='105181'   \/><label for='answer-id-105181' id='answer-label-105181' class=' answer'><span>Inquire of key personnel concerning related parties and subsequent events.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25448[]' id='answer-id-105182' class='answer   answerof-25448 ' value='105182'   \/><label for='answer-id-105182' id='answer-label-105182' class=' answer'><span>Perform ratio analyses of the financial data of comparable prior periods.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-228' style=';'><div id='questionWrap-228'  class='   watupro-question-id-25449'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>228. <\/span>Jones Retailing, a nonissuer, has asked Winters, CPA, to compile financial statements that omit substantially all disclosures required by generally accepted accounting principles. <br \/>\r<br>Winters may compile such financial statements provided the:<\/div><input type='hidden' name='question_id[]' id='qID_228' value='25449' \/><input type='hidden' id='answerType25449' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25449[]' id='answer-id-105183' class='answer   answerof-25449 ' value='105183'   \/><label for='answer-id-105183' id='answer-label-105183' class=' answer'><span>Reason for omitting the disclosures is explained in the engagement letter and acknowledged in the management representation letter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25449[]' id='answer-id-105184' class='answer   answerof-25449 ' value='105184'   \/><label for='answer-id-105184' id='answer-label-105184' class=' answer'><span>Financial statements are prepared on a comprehensive basis of accounting other than generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25449[]' id='answer-id-105185' class='answer   answerof-25449 ' value='105185'   \/><label for='answer-id-105185' id='answer-label-105185' class=' answer'><span>Use of the financial statements is restricted to internal use only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25449[]' id='answer-id-105186' class='answer   answerof-25449 ' value='105186'   \/><label for='answer-id-105186' id='answer-label-105186' class=' answer'><span>Omission is not undertaken to mislead the users of the financial statements and is properly disclosed in the accountant's report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-229' style=';'><div id='questionWrap-229'  class='   watupro-question-id-25450'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>229. <\/span>Which of the following procedures is usually performed by the accountant in a review engagement of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_229' value='25450' \/><input type='hidden' id='answerType25450' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25450[]' id='answer-id-105187' class='answer   answerof-25450 ' value='105187'   \/><label for='answer-id-105187' id='answer-label-105187' class=' answer'><span>Sending a letter of inquiry to the entity's lawyer.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25450[]' id='answer-id-105188' class='answer   answerof-25450 ' value='105188'   \/><label for='answer-id-105188' id='answer-label-105188' class=' answer'><span>Comparing the financial statements with statements for comparable prior periods.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25450[]' id='answer-id-105189' class='answer   answerof-25450 ' value='105189'   \/><label for='answer-id-105189' id='answer-label-105189' class=' answer'><span>Confirming a significant percentage of receivables by direct communication with debtors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25450[]' id='answer-id-105190' class='answer   answerof-25450 ' value='105190'   \/><label for='answer-id-105190' id='answer-label-105190' class=' answer'><span>Communicating significant deficiencies discovered during the study of the internal control structure.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-230' style=';'><div id='questionWrap-230'  class='   watupro-question-id-25451'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>230. <\/span>Which of the following procedures is more likely to be performed in a review engagement of a nonissuer than in a compilation engagement?<\/div><input type='hidden' name='question_id[]' id='qID_230' value='25451' \/><input type='hidden' id='answerType25451' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25451[]' id='answer-id-105191' class='answer   answerof-25451 ' value='105191'   \/><label for='answer-id-105191' id='answer-label-105191' class=' answer'><span>Gaining an understanding of the entity's business transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25451[]' id='answer-id-105192' class='answer   answerof-25451 ' value='105192'   \/><label for='answer-id-105192' id='answer-label-105192' class=' answer'><span>Making a preliminary assessment of control risk.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25451[]' id='answer-id-105193' class='answer   answerof-25451 ' value='105193'   \/><label for='answer-id-105193' id='answer-label-105193' class=' answer'><span>Obtaining a representation letter from the chief executive officer.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25451[]' id='answer-id-105194' class='answer   answerof-25451 ' value='105194'   \/><label for='answer-id-105194' id='answer-label-105194' class=' answer'><span>Assisting the entity in adjusting the accounting records.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-231' style=';'><div id='questionWrap-231'  class='   watupro-question-id-25452'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>231. <\/span>Statements on Standards for Accounting and Review Services establish standards and procedures for which of the following engagements?<\/div><input type='hidden' name='question_id[]' id='qID_231' value='25452' \/><input type='hidden' id='answerType25452' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25452[]' id='answer-id-105195' class='answer   answerof-25452 ' value='105195'   \/><label for='answer-id-105195' id='answer-label-105195' class=' answer'><span>Proposing adjustments to the books of account for a partnership.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25452[]' id='answer-id-105196' class='answer   answerof-25452 ' value='105196'   \/><label for='answer-id-105196' id='answer-label-105196' class=' answer'><span>Reviewing interim financial data required to be filed with the SE<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25452[]' id='answer-id-105197' class='answer   answerof-25452 ' value='105197'   \/><label for='answer-id-105197' id='answer-label-105197' class=' answer'><span>Preparing standard monthly journal entries.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25452[]' id='answer-id-105198' class='answer   answerof-25452 ' value='105198'   \/><label for='answer-id-105198' id='answer-label-105198' class=' answer'><span>Compiling an individual's personal financial statement to be used to obtain a mortgage.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-232' style=';'><div id='questionWrap-232'  class='   watupro-question-id-25453'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>232. <\/span>When compiling a nonissuer's financial statements, an accountant would be least likely to:<\/div><input type='hidden' name='question_id[]' id='qID_232' value='25453' \/><input type='hidden' id='answerType25453' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25453[]' id='answer-id-105199' class='answer   answerof-25453 ' value='105199'   \/><label for='answer-id-105199' id='answer-label-105199' class=' answer'><span>Perform analytical procedures designed to identify relationships that appear to be unusual.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25453[]' id='answer-id-105200' class='answer   answerof-25453 ' value='105200'   \/><label for='answer-id-105200' id='answer-label-105200' class=' answer'><span>Read the compiled financial statements and consider whether they appear to include adequate disclosure.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25453[]' id='answer-id-105201' class='answer   answerof-25453 ' value='105201'   \/><label for='answer-id-105201' id='answer-label-105201' class=' answer'><span>Omit substantially all of the disclosures required by generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25453[]' id='answer-id-105202' class='answer   answerof-25453 ' value='105202'   \/><label for='answer-id-105202' id='answer-label-105202' class=' answer'><span>Issue a compilation report on one or more, but not all, of the basic financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-233' style=';'><div id='questionWrap-233'  class='   watupro-question-id-25454'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>233. <\/span>Which of the following procedures would most likely be included in a review engagement of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_233' value='25454' \/><input type='hidden' id='answerType25454' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25454[]' id='answer-id-105203' class='answer   answerof-25454 ' value='105203'   \/><label for='answer-id-105203' id='answer-label-105203' class=' answer'><span>Preparing a bank transfer schedule.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25454[]' id='answer-id-105204' class='answer   answerof-25454 ' value='105204'   \/><label for='answer-id-105204' id='answer-label-105204' class=' answer'><span>Inquiring about related party transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25454[]' id='answer-id-105205' class='answer   answerof-25454 ' value='105205'   \/><label for='answer-id-105205' id='answer-label-105205' class=' answer'><span>Assessing the internal control structure.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25454[]' id='answer-id-105206' class='answer   answerof-25454 ' value='105206'   \/><label for='answer-id-105206' id='answer-label-105206' class=' answer'><span>Performing cutoff tests on sales and purchases transactions.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-234' style=';'><div id='questionWrap-234'  class='   watupro-question-id-25455'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>234. <\/span>Baker, CPA, was engaged to review the financial statements of Hall Company, a nonissuer. Evidence came to Baker's attention that indicated substantial doubt as to Hall's ability to continue as a going concern. The principal conditions and events that caused the substantial doubt have been fully disclosed in the notes to Hall's financial statements. <br \/>\r<br>Which of the following statements best describes Baker's reporting responsibility concerning this matter?<\/div><input type='hidden' name='question_id[]' id='qID_234' value='25455' \/><input type='hidden' id='answerType25455' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25455[]' id='answer-id-105207' class='answer   answerof-25455 ' value='105207'   \/><label for='answer-id-105207' id='answer-label-105207' class=' answer'><span>Baker is not required to modify the accountant's review report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25455[]' id='answer-id-105208' class='answer   answerof-25455 ' value='105208'   \/><label for='answer-id-105208' id='answer-label-105208' class=' answer'><span>Baker is not permitted to modify the accountant's review report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25455[]' id='answer-id-105209' class='answer   answerof-25455 ' value='105209'   \/><label for='answer-id-105209' id='answer-label-105209' class=' answer'><span>Baker should issue an accountant's compilation report instead of a review report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25455[]' id='answer-id-105210' class='answer   answerof-25455 ' value='105210'   \/><label for='answer-id-105210' id='answer-label-105210' class=' answer'><span>Baker should express a qualified opinion in the accountant's review report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-235' style=';'><div id='questionWrap-235'  class='   watupro-question-id-25456'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>235. <\/span>The authoritative body designated to promulgate standards concerning an accountant's association with unaudited financial statements of an entity that is not required to file financial statements with an agency regulating the issuance of the entity's securities is the:<\/div><input type='hidden' name='question_id[]' id='qID_235' value='25456' \/><input type='hidden' id='answerType25456' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25456[]' id='answer-id-105211' class='answer   answerof-25456 ' value='105211'   \/><label for='answer-id-105211' id='answer-label-105211' class=' answer'><span>Financial Accounting Standards Board.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25456[]' id='answer-id-105212' class='answer   answerof-25456 ' value='105212'   \/><label for='answer-id-105212' id='answer-label-105212' class=' answer'><span>General Accounting Office.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25456[]' id='answer-id-105213' class='answer   answerof-25456 ' value='105213'   \/><label for='answer-id-105213' id='answer-label-105213' class=' answer'><span>Accounting and Review Services Committee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25456[]' id='answer-id-105214' class='answer   answerof-25456 ' value='105214'   \/><label for='answer-id-105214' id='answer-label-105214' class=' answer'><span>Auditing Standards Board.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-236' style=';'><div id='questionWrap-236'  class='   watupro-question-id-25457'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>236. <\/span>When an accountant performs more than one level of service (for example, a compilation and a review, or a compilation and an audit) concerning the financial statements of a nonissuer, the accountant generally should issue the report that is appropriate for:<\/div><input type='hidden' name='question_id[]' id='qID_236' value='25457' \/><input type='hidden' id='answerType25457' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25457[]' id='answer-id-105215' class='answer   answerof-25457 ' value='105215'   \/><label for='answer-id-105215' id='answer-label-105215' class=' answer'><span>The lowest level of service rendered.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25457[]' id='answer-id-105216' class='answer   answerof-25457 ' value='105216'   \/><label for='answer-id-105216' id='answer-label-105216' class=' answer'><span>The highest level of service rendered.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25457[]' id='answer-id-105217' class='answer   answerof-25457 ' value='105217'   \/><label for='answer-id-105217' id='answer-label-105217' class=' answer'><span>A compilation engagement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25457[]' id='answer-id-105218' class='answer   answerof-25457 ' value='105218'   \/><label for='answer-id-105218' id='answer-label-105218' class=' answer'><span>A review engagement.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-237' style=';'><div id='questionWrap-237'  class='   watupro-question-id-25458'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>237. <\/span>An accountant who reviews the financial statements of a nonissuer should issue a report stating that a review:<\/div><input type='hidden' name='question_id[]' id='qID_237' value='25458' \/><input type='hidden' id='answerType25458' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25458[]' id='answer-id-105219' class='answer   answerof-25458 ' value='105219'   \/><label for='answer-id-105219' id='answer-label-105219' class=' answer'><span>Is substantially less in scope than an audit.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25458[]' id='answer-id-105220' class='answer   answerof-25458 ' value='105220'   \/><label for='answer-id-105220' id='answer-label-105220' class=' answer'><span>Provides negative assurance that the internal control structure is functioning as designed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25458[]' id='answer-id-105221' class='answer   answerof-25458 ' value='105221'   \/><label for='answer-id-105221' id='answer-label-105221' class=' answer'><span>Provides only limited assurance that the financial statements are fairly presented.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25458[]' id='answer-id-105222' class='answer   answerof-25458 ' value='105222'   \/><label for='answer-id-105222' id='answer-label-105222' class=' answer'><span>Is substantially more in scope than a compilation.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-238' style=';'><div id='questionWrap-238'  class='   watupro-question-id-25459'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>238. <\/span>Before performing a review of a nonissuer's financial statements, an accountant should:<\/div><input type='hidden' name='question_id[]' id='qID_238' value='25459' \/><input type='hidden' id='answerType25459' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25459[]' id='answer-id-105223' class='answer   answerof-25459 ' value='105223'   \/><label for='answer-id-105223' id='answer-label-105223' class=' answer'><span>Complete a series of inquiries concerning the entity's procedures for recording, classifying, and summarizing transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25459[]' id='answer-id-105224' class='answer   answerof-25459 ' value='105224'   \/><label for='answer-id-105224' id='answer-label-105224' class=' answer'><span>Apply analytical procedures to provide limited assurance that no material modifications should be made to the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25459[]' id='answer-id-105225' class='answer   answerof-25459 ' value='105225'   \/><label for='answer-id-105225' id='answer-label-105225' class=' answer'><span>Obtain a sufficient level of knowledge of the accounting principles and practices of the industry in which the entity operates.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25459[]' id='answer-id-105226' class='answer   answerof-25459 ' value='105226'   \/><label for='answer-id-105226' id='answer-label-105226' class=' answer'><span>Inquire whether management has omitted substantially all of the disclosures required by generally accepted accounting principles.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-239' style=';'><div id='questionWrap-239'  class='   watupro-question-id-25460'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>239. <\/span>Which of the following is not true about documentation requirements related to a review of a nonissuer's financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_239' value='25460' \/><input type='hidden' id='answerType25460' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25460[]' id='answer-id-105227' class='answer   answerof-25460 ' value='105227'   \/><label for='answer-id-105227' id='answer-label-105227' class=' answer'><span>Written documentation from a compilation engagement may be used to provide support for the review \r\nreport.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25460[]' id='answer-id-105228' class='answer   answerof-25460 ' value='105228'   \/><label for='answer-id-105228' id='answer-label-105228' class=' answer'><span>A management representation letter should be included in the documentation files.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25460[]' id='answer-id-105229' class='answer   answerof-25460 ' value='105229'   \/><label for='answer-id-105229' id='answer-label-105229' class=' answer'><span>The auditor must document evidence obtained about the operating effectiveness of controls.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25460[]' id='answer-id-105230' class='answer   answerof-25460 ' value='105230'   \/><label for='answer-id-105230' id='answer-label-105230' class=' answer'><span>Documentation should include the results of analytical procedures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-240' style=';'><div id='questionWrap-240'  class='   watupro-question-id-25461'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>240. <\/span>An accountant performing a compilation or review of the financial statements of a nonissuer should:<\/div><input type='hidden' name='question_id[]' id='qID_240' value='25461' \/><input type='hidden' id='answerType25461' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25461[]' id='answer-id-105231' class='answer   answerof-25461 ' value='105231'   \/><label for='answer-id-105231' id='answer-label-105231' class=' answer'><span>Be able to justify departures from SSAR<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25461[]' id='answer-id-105232' class='answer   answerof-25461 ' value='105232'   \/><label for='answer-id-105232' id='answer-label-105232' class=' answer'><span>Never depart from SSARS guidelines.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25461[]' id='answer-id-105233' class='answer   answerof-25461 ' value='105233'   \/><label for='answer-id-105233' id='answer-label-105233' class=' answer'><span>Exercise professional judgment in applying SSARS, since they are considered recommendations as opposed to standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25461[]' id='answer-id-105234' class='answer   answerof-25461 ' value='105234'   \/><label for='answer-id-105234' id='answer-label-105234' class=' answer'><span>Not depart from Statements on Auditing Standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-241' style=';'><div id='questionWrap-241'  class='   watupro-question-id-25462'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>241. <\/span>When performing an engagement to review a nonissuer's financial statements, an accountant most likely would:<\/div><input type='hidden' name='question_id[]' id='qID_241' value='25462' \/><input type='hidden' id='answerType25462' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25462[]' id='answer-id-105235' class='answer   answerof-25462 ' value='105235'   \/><label for='answer-id-105235' id='answer-label-105235' class=' answer'><span>Obtain an understanding of the entity's internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25462[]' id='answer-id-105236' class='answer   answerof-25462 ' value='105236'   \/><label for='answer-id-105236' id='answer-label-105236' class=' answer'><span>Limit the distribution of the accountant's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25462[]' id='answer-id-105237' class='answer   answerof-25462 ' value='105237'   \/><label for='answer-id-105237' id='answer-label-105237' class=' answer'><span>Confirm a sample of significant accounts receivable balances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25462[]' id='answer-id-105238' class='answer   answerof-25462 ' value='105238'   \/><label for='answer-id-105238' id='answer-label-105238' class=' answer'><span>Ask about actions taken at board of directors' meetings.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-242' style=';'><div id='questionWrap-242'  class='   watupro-question-id-25463'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>242. <\/span>Which of the following should be the first step in reviewing the financial statements of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_242' value='25463' \/><input type='hidden' id='answerType25463' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25463[]' id='answer-id-105239' class='answer   answerof-25463 ' value='105239'   \/><label for='answer-id-105239' id='answer-label-105239' class=' answer'><span>Comparing the financial statements with statements for comparable prior periods and with anticipated results.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25463[]' id='answer-id-105240' class='answer   answerof-25463 ' value='105240'   \/><label for='answer-id-105240' id='answer-label-105240' class=' answer'><span>Completing a series of inquiries concerning the entity's procedures for recording, classifying, and summarizing transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25463[]' id='answer-id-105241' class='answer   answerof-25463 ' value='105241'   \/><label for='answer-id-105241' id='answer-label-105241' class=' answer'><span>Obtaining a general understanding of the entity's organization, its operating characteristics, and its products or services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25463[]' id='answer-id-105242' class='answer   answerof-25463 ' value='105242'   \/><label for='answer-id-105242' id='answer-label-105242' class=' answer'><span>Applying analytical procedures designed to identify relationships and individual items that appear to be unusual.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-243' style=';'><div id='questionWrap-243'  class='   watupro-question-id-25464'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>243. <\/span>An accountant has been asked to issue a review report on the balance sheet of a nonissuer without reporting on the related statements of income, retained earnings, and cash flows. <br \/>\r<br>The accountant may issue the requested review report only if:<\/div><input type='hidden' name='question_id[]' id='qID_243' value='25464' \/><input type='hidden' id='answerType25464' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25464[]' id='answer-id-105243' class='answer   answerof-25464 ' value='105243'   \/><label for='answer-id-105243' id='answer-label-105243' class=' answer'><span>The balance sheet is not to be used to obtain credit or distributed to the entity's creditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25464[]' id='answer-id-105244' class='answer   answerof-25464 ' value='105244'   \/><label for='answer-id-105244' id='answer-label-105244' class=' answer'><span>The balance sheet is part of a comprehensive personal financial plan developed to assist the entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25464[]' id='answer-id-105245' class='answer   answerof-25464 ' value='105245'   \/><label for='answer-id-105245' id='answer-label-105245' class=' answer'><span>There have been no material changes during the year in the entity's accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25464[]' id='answer-id-105246' class='answer   answerof-25464 ' value='105246'   \/><label for='answer-id-105246' id='answer-label-105246' class=' answer'><span>The scope of the accountant's inquiry and analytical procedures has not been restricted.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-244' style=';'><div id='questionWrap-244'  class='   watupro-question-id-25465'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>244. <\/span>An accountant is asked to issue a review report on the balance sheet, but not on other related statements. The scope of the inquiry and analytical procedures has not been restricted, but the client failed to provide a representation letter. <br \/>\r<br>Which of the following should the accountant issue under these circumstances?<\/div><input type='hidden' name='question_id[]' id='qID_244' value='25465' \/><input type='hidden' id='answerType25465' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25465[]' id='answer-id-105247' class='answer   answerof-25465 ' value='105247'   \/><label for='answer-id-105247' id='answer-label-105247' class=' answer'><span>Review report with a qualification.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25465[]' id='answer-id-105248' class='answer   answerof-25465 ' value='105248'   \/><label for='answer-id-105248' id='answer-label-105248' class=' answer'><span>Review report with a disclaimer.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25465[]' id='answer-id-105249' class='answer   answerof-25465 ' value='105249'   \/><label for='answer-id-105249' id='answer-label-105249' class=' answer'><span>Review report and footnote exceptions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25465[]' id='answer-id-105250' class='answer   answerof-25465 ' value='105250'   \/><label for='answer-id-105250' id='answer-label-105250' class=' answer'><span>Compilation report with the client's consent.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-245' style=';'><div id='questionWrap-245'  class='   watupro-question-id-25466'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>245. <\/span>Which of the following procedures is usually the first step in reviewing the financial statements of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_245' value='25466' \/><input type='hidden' id='answerType25466' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25466[]' id='answer-id-105251' class='answer   answerof-25466 ' value='105251'   \/><label for='answer-id-105251' id='answer-label-105251' class=' answer'><span>Make preliminary judgments about risk and materiality to determine the scope and nature of the procedures to be performed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25466[]' id='answer-id-105252' class='answer   answerof-25466 ' value='105252'   \/><label for='answer-id-105252' id='answer-label-105252' class=' answer'><span>Obtain a general understanding of the entity's organization, its operating characteristics, and its products or services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25466[]' id='answer-id-105253' class='answer   answerof-25466 ' value='105253'   \/><label for='answer-id-105253' id='answer-label-105253' class=' answer'><span>Assess the risk of material misstatement arising from fraudulent financial reporting and the misappropriation of assets.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25466[]' id='answer-id-105254' class='answer   answerof-25466 ' value='105254'   \/><label for='answer-id-105254' id='answer-label-105254' class=' answer'><span>Perform a preliminary assessment of the operating efficiency of the entity's internal control activities.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-246' style=';'><div id='questionWrap-246'  class='   watupro-question-id-25467'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>246. <\/span>An accountant's standard report issued after compiling the financial statements of a nonissuer should state that:<\/div><input type='hidden' name='question_id[]' id='qID_246' value='25467' \/><input type='hidden' id='answerType25467' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25467[]' id='answer-id-105255' class='answer   answerof-25467 ' value='105255'   \/><label for='answer-id-105255' id='answer-label-105255' class=' answer'><span>I am not aware of any material modifications that should be made to the accompanying financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25467[]' id='answer-id-105256' class='answer   answerof-25467 ' value='105256'   \/><label for='answer-id-105256' id='answer-label-105256' class=' answer'><span>A compilation consists principally of inquiries of company personnel and analytical procedures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25467[]' id='answer-id-105257' class='answer   answerof-25467 ' value='105257'   \/><label for='answer-id-105257' id='answer-label-105257' class=' answer'><span>A compilation is limited to presenting in the form of financial statements information that is the representation of management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25467[]' id='answer-id-105258' class='answer   answerof-25467 ' value='105258'   \/><label for='answer-id-105258' id='answer-label-105258' class=' answer'><span>A compilation is substantially less in scope than an audit in accordance with GAAS, the objective of which is the expression of an opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-247' style=';'><div id='questionWrap-247'  class='   watupro-question-id-25468'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>247. <\/span>Which of the following would be used on a review engagement?<\/div><input type='hidden' name='question_id[]' id='qID_247' value='25468' \/><input type='hidden' id='answerType25468' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25468[]' id='answer-id-105259' class='answer   answerof-25468 ' value='105259'   \/><label for='answer-id-105259' id='answer-label-105259' class=' answer'><span>Examination of board minutes.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25468[]' id='answer-id-105260' class='answer   answerof-25468 ' value='105260'   \/><label for='answer-id-105260' id='answer-label-105260' class=' answer'><span>Confirmation of cash and accounts receivable.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25468[]' id='answer-id-105261' class='answer   answerof-25468 ' value='105261'   \/><label for='answer-id-105261' id='answer-label-105261' class=' answer'><span>Comparison of current-year to prior-year account balances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25468[]' id='answer-id-105262' class='answer   answerof-25468 ' value='105262'   \/><label for='answer-id-105262' id='answer-label-105262' class=' answer'><span>Recalculation of depreciation expense.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-248' style=';'><div id='questionWrap-248'  class='   watupro-question-id-25469'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>248. <\/span>Which of the following statements is true regarding an accountant's consideration of fraud\/illegal acts in compilation and review engagements?<\/div><input type='hidden' name='question_id[]' id='qID_248' value='25469' \/><input type='hidden' id='answerType25469' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25469[]' id='answer-id-105263' class='answer   answerof-25469 ' value='105263'   \/><label for='answer-id-105263' id='answer-label-105263' class=' answer'><span>The accountant is not required to perform procedures designed to detect material misstatements due to fraud or illegal acts.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25469[]' id='answer-id-105264' class='answer   answerof-25469 ' value='105264'   \/><label for='answer-id-105264' id='answer-label-105264' class=' answer'><span>The accountant must inform an appropriate level of management of all instances of fraud or illegal acts.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25469[]' id='answer-id-105265' class='answer   answerof-25469 ' value='105265'   \/><label for='answer-id-105265' id='answer-label-105265' class=' answer'><span>The accountant must report only definite instances of fraud or an illegal act, but need not report information indicating that fraud or an illegal act may have occurred.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25469[]' id='answer-id-105266' class='answer   answerof-25469 ' value='105266'   \/><label for='answer-id-105266' id='answer-label-105266' class=' answer'><span>Information indicating that fraud or an illegal act may have occurred should be reported in writing to an appropriate level of management.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-249' style=';'><div id='questionWrap-249'  class='   watupro-question-id-25470'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>249. <\/span>An accountant had begun to audit the financial statements of a nonissuer. <br \/>\r<br>Which of the following circumstances most likely would be considered a reasonable basis for agreeing to the entity's request to change the engagement to a compilation?<\/div><input type='hidden' name='question_id[]' id='qID_249' value='25470' \/><input type='hidden' id='answerType25470' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25470[]' id='answer-id-105267' class='answer   answerof-25470 ' value='105267'   \/><label for='answer-id-105267' id='answer-label-105267' class=' answer'><span>The entity's management does not provide the accountant with a signed representation letter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25470[]' id='answer-id-105268' class='answer   answerof-25470 ' value='105268'   \/><label for='answer-id-105268' id='answer-label-105268' class=' answer'><span>The accountant is prohibited from corresponding with the entity's legal counsel.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25470[]' id='answer-id-105269' class='answer   answerof-25470 ' value='105269'   \/><label for='answer-id-105269' id='answer-label-105269' class=' answer'><span>The entity's principal creditors no longer require the entity to furnish audited financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25470[]' id='answer-id-105270' class='answer   answerof-25470 ' value='105270'   \/><label for='answer-id-105270' id='answer-label-105270' class=' answer'><span>The accountant is prevented from examining the minutes of the board of directors' meetings.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-250' style=';'><div id='questionWrap-250'  class='   watupro-question-id-25471'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>250. <\/span>Which of the following statements is correct regarding a review engagement of a nonissuer's financial statements performed in accordance with the Statements on Standards for Accounting and Review Services (SSARS)?<\/div><input type='hidden' name='question_id[]' id='qID_250' value='25471' \/><input type='hidden' id='answerType25471' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25471[]' id='answer-id-105271' class='answer   answerof-25471 ' value='105271'   \/><label for='answer-id-105271' id='answer-label-105271' class=' answer'><span>An accountant must establish an understanding with the client in an engagement letter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25471[]' id='answer-id-105272' class='answer   answerof-25471 ' value='105272'   \/><label for='answer-id-105272' id='answer-label-105272' class=' answer'><span>An accountant must obtain an understanding of the client's internal control when performing a review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25471[]' id='answer-id-105273' class='answer   answerof-25471 ' value='105273'   \/><label for='answer-id-105273' id='answer-label-105273' class=' answer'><span>A review provides an accountant with a basis for expressing limited assurance on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25471[]' id='answer-id-105274' class='answer   answerof-25471 ' value='105274'   \/><label for='answer-id-105274' id='answer-label-105274' class=' answer'><span>A review report contains an accountant's opinion of the financial statements taken as a whole.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-251' style=';'><div id='questionWrap-251'  class='   watupro-question-id-25472'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>251. <\/span>Which of the following procedures does a CPA normally perform first in a review engagement in accordance with Statements on Standards for Accounting and Review Services (SSARS)?<\/div><input type='hidden' name='question_id[]' id='qID_251' value='25472' \/><input type='hidden' id='answerType25472' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25472[]' id='answer-id-105275' class='answer   answerof-25472 ' value='105275'   \/><label for='answer-id-105275' id='answer-label-105275' class=' answer'><span>Inquiry regarding the client's principles and practices and the method of applying them.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25472[]' id='answer-id-105276' class='answer   answerof-25472 ' value='105276'   \/><label for='answer-id-105276' id='answer-label-105276' class=' answer'><span>Inquiry concerning the effectiveness of the client's system of internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25472[]' id='answer-id-105277' class='answer   answerof-25472 ' value='105277'   \/><label for='answer-id-105277' id='answer-label-105277' class=' answer'><span>Inquiry to identify transactions between related parties and management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25472[]' id='answer-id-105278' class='answer   answerof-25472 ' value='105278'   \/><label for='answer-id-105278' id='answer-label-105278' class=' answer'><span>Inquiry of the client's professional advisors, including bankers, insurance agents, and consultants.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-252' style=';'><div id='questionWrap-252'  class='   watupro-question-id-25473'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>252. <\/span>Which of the following describes how the objective of a review of financial statements differs from the objective of a compilation engagement?<\/div><input type='hidden' name='question_id[]' id='qID_252' value='25473' \/><input type='hidden' id='answerType25473' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25473[]' id='answer-id-105279' class='answer   answerof-25473 ' value='105279'   \/><label for='answer-id-105279' id='answer-label-105279' class=' answer'><span>The primary objective of a review engagement is to test the completeness of the financial statements prepared, but a compilation tests for reasonableness.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25473[]' id='answer-id-105280' class='answer   answerof-25473 ' value='105280'   \/><label for='answer-id-105280' id='answer-label-105280' class=' answer'><span>The primary objective of a review engagement is to provide positive assurance that the financial statements are fairly presented, but a compilation provides no such assurance.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25473[]' id='answer-id-105281' class='answer   answerof-25473 ' value='105281'   \/><label for='answer-id-105281' id='answer-label-105281' class=' answer'><span>In a review engagement, accountants provide limited assurance, but a compilation expresses no assurance.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25473[]' id='answer-id-105282' class='answer   answerof-25473 ' value='105282'   \/><label for='answer-id-105282' id='answer-label-105282' class=' answer'><span>In a review engagement, accountants provide reasonable or positive assurance that the financial statements are fairly presented, but a compilation provides limited assurance.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-253' style=';'><div id='questionWrap-253'  class='   watupro-question-id-25474'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>253. <\/span>The standard report issued by an accountant after reviewing the financial statements of a nonissuer should state that:<\/div><input type='hidden' name='question_id[]' id='qID_253' value='25474' \/><input type='hidden' id='answerType25474' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25474[]' id='answer-id-105283' class='answer   answerof-25474 ' value='105283'   \/><label for='answer-id-105283' id='answer-label-105283' class=' answer'><span>A review is limited to presenting in the form of financial statements information that is the representation of management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25474[]' id='answer-id-105284' class='answer   answerof-25474 ' value='105284'   \/><label for='answer-id-105284' id='answer-label-105284' class=' answer'><span>A review consists of inquiries of company personnel and analytical procedures applied to financial data.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25474[]' id='answer-id-105285' class='answer   answerof-25474 ' value='105285'   \/><label for='answer-id-105285' id='answer-label-105285' class=' answer'><span>The accountant does not express an opinion or any other form of assurance on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25474[]' id='answer-id-105286' class='answer   answerof-25474 ' value='105286'   \/><label for='answer-id-105286' id='answer-label-105286' class=' answer'><span>The accountant did not obtain an understanding of the entity's internal control or assess control risk.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-254' style=';'><div id='questionWrap-254'  class='   watupro-question-id-25475'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>254. <\/span>While auditing the financial statements of a nonissuer, a CPA was requested to change the engagement to a review in accordance with Statements on Standards for Accounting and Review Services (SSARS) because of a scope limitation. <br \/>\r<br>If the CPA believes the client's request is reasonable, the CPA's review report should: <br \/>\r<br>I. Refer to the scope limitation that caused the change. <br \/>\r<br>II. Describe the auditing procedures that have already been applied.<\/div><input type='hidden' name='question_id[]' id='qID_254' value='25475' \/><input type='hidden' id='answerType25475' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25475[]' id='answer-id-105287' class='answer   answerof-25475 ' value='105287'   \/><label for='answer-id-105287' id='answer-label-105287' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25475[]' id='answer-id-105288' class='answer   answerof-25475 ' value='105288'   \/><label for='answer-id-105288' id='answer-label-105288' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25475[]' id='answer-id-105289' class='answer   answerof-25475 ' value='105289'   \/><label for='answer-id-105289' id='answer-label-105289' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25475[]' id='answer-id-105290' class='answer   answerof-25475 ' value='105290'   \/><label for='answer-id-105290' id='answer-label-105290' class=' answer'><span>Neither I nor I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-255' style=';'><div id='questionWrap-255'  class='   watupro-question-id-25476'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>255. <\/span>When unaudited financial statements of a nonissuer are presented in comparative form with audited financial statements in the subsequent year, the unaudited financial statements should be clearly marked to indicate their status and: <br \/>\r<br>I. The report on the unaudited financial statements should be reissued. <br \/>\r<br>II. The report on the audited financial statements should include a separate paragraph describing the responsibility assumed for the unaudited financial statements.<\/div><input type='hidden' name='question_id[]' id='qID_255' value='25476' \/><input type='hidden' id='answerType25476' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25476[]' id='answer-id-105291' class='answer   answerof-25476 ' value='105291'   \/><label for='answer-id-105291' id='answer-label-105291' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25476[]' id='answer-id-105292' class='answer   answerof-25476 ' value='105292'   \/><label for='answer-id-105292' id='answer-label-105292' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25476[]' id='answer-id-105293' class='answer   answerof-25476 ' value='105293'   \/><label for='answer-id-105293' id='answer-label-105293' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25476[]' id='answer-id-105294' class='answer   answerof-25476 ' value='105294'   \/><label for='answer-id-105294' id='answer-label-105294' class=' answer'><span>Either I or I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-256' style=';'><div id='questionWrap-256'  class='   watupro-question-id-25477'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>256. <\/span>When unaudited financial statements are presented in comparative form with audited financial statements in a document filed with the Securities and Exchange Commission, such statements should be: <br \/>\r<br><br><img decoding=\"async\" width=588 height=114 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image058.jpg\" v:shapes=\"_x0000_i1053\"><br><\/div><input type='hidden' name='question_id[]' id='qID_256' value='25477' \/><input type='hidden' id='answerType25477' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25477[]' id='answer-id-105295' class='answer   answerof-25477 ' value='105295'   \/><label for='answer-id-105295' id='answer-label-105295' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25477[]' id='answer-id-105296' class='answer   answerof-25477 ' value='105296'   \/><label for='answer-id-105296' id='answer-label-105296' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25477[]' id='answer-id-105297' class='answer   answerof-25477 ' value='105297'   \/><label for='answer-id-105297' id='answer-label-105297' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25477[]' id='answer-id-105298' class='answer   answerof-25477 ' value='105298'   \/><label for='answer-id-105298' id='answer-label-105298' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-257' style=';'><div id='questionWrap-257'  class='   watupro-question-id-25478'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>257. <\/span>Clark, CPA, compiled and properly reported on the financial statements of Green Co., a nonissuer, for the year ended March 31, 20X1. These financial statements omitted substantially all disclosures required by generally accepted accounting principles (GAAP). Green asked Clark to compile the statements for the year ended March 31, 20X2, and to include all GAAP disclosures for the 20X2 statements only, but otherwise present both years' financial statements in comparative form. <br \/>\r<br>What is Clark's responsibility concerning the proposed engagement?<\/div><input type='hidden' name='question_id[]' id='qID_257' value='25478' \/><input type='hidden' id='answerType25478' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25478[]' id='answer-id-105299' class='answer   answerof-25478 ' value='105299'   \/><label for='answer-id-105299' id='answer-label-105299' class=' answer'><span>Clark may not report on the comparative financial statements because the 20X1 statements are not comparable to the 20X2 statements that include the GAAP disclosures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25478[]' id='answer-id-105300' class='answer   answerof-25478 ' value='105300'   \/><label for='answer-id-105300' id='answer-label-105300' class=' answer'><span>Clark may report on the comparative financial statements provided the 20X1 statements do not contain any obvious material misstatements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25478[]' id='answer-id-105301' class='answer   answerof-25478 ' value='105301'   \/><label for='answer-id-105301' id='answer-label-105301' class=' answer'><span>Clark may report on the comparative financial statements provided an explanatory paragraph is added to Clark's report on the comparative financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25478[]' id='answer-id-105302' class='answer   answerof-25478 ' value='105302'   \/><label for='answer-id-105302' id='answer-label-105302' class=' answer'><span>Clark may report on the comparative financial statements provided Clark updates the report on the 20X1 statements that do not include the GAAP disclosures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-258' style=';'><div id='questionWrap-258'  class='   watupro-question-id-25479'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>258. <\/span>Silver, CPA, has been hired by Andrews Co., a publicly held company, to conduct a review of its interim financial information. While performing review procedures, Silver becomes aware of a significant change in the control activities at one of Andrew's branch locations. <br \/>\r<br>Which of the following might Silver consider performing in response to this situation?<\/div><input type='hidden' name='question_id[]' id='qID_258' value='25479' \/><input type='hidden' id='answerType25479' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25479[]' id='answer-id-105303' class='answer   answerof-25479 ' value='105303'   \/><label for='answer-id-105303' id='answer-label-105303' class=' answer'><span>Making additional inquiries, such as whether management has monitored the changes and considered whether they were operating as intended.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25479[]' id='answer-id-105304' class='answer   answerof-25479 ' value='105304'   \/><label for='answer-id-105304' id='answer-label-105304' class=' answer'><span>Employing analytical procedures with a less precise expectation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25479[]' id='answer-id-105305' class='answer   answerof-25479 ' value='105305'   \/><label for='answer-id-105305' id='answer-label-105305' class=' answer'><span>Both &quot;a&quot; and &quot;b&quot; above.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25479[]' id='answer-id-105306' class='answer   answerof-25479 ' value='105306'   \/><label for='answer-id-105306' id='answer-label-105306' class=' answer'><span>Neither &quot;a&quot; nor &quot;b&quot; above.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-259' style=';'><div id='questionWrap-259'  class='   watupro-question-id-25480'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>259. <\/span>Davidson, CPA, is performing a review under auditing standards of Gold's interim financial information. As part of planning, Davidson reads the audit documentation from the preceding year's annual audit. <br \/>\r<br>Which of the following is least likely to affect Davidson's review?<\/div><input type='hidden' name='question_id[]' id='qID_259' value='25480' \/><input type='hidden' id='answerType25480' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25480[]' id='answer-id-105307' class='answer   answerof-25480 ' value='105307'   \/><label for='answer-id-105307' id='answer-label-105307' class=' answer'><span>A summary of both corrected and uncorrected misstatements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25480[]' id='answer-id-105308' class='answer   answerof-25480 ' value='105308'   \/><label for='answer-id-105308' id='answer-label-105308' class=' answer'><span>Identified risks of material misstatement due to fraud.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25480[]' id='answer-id-105309' class='answer   answerof-25480 ' value='105309'   \/><label for='answer-id-105309' id='answer-label-105309' class=' answer'><span>Significant weaknesses in internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25480[]' id='answer-id-105310' class='answer   answerof-25480 ' value='105310'   \/><label for='answer-id-105310' id='answer-label-105310' class=' answer'><span>Scope limitations that were overcome through acceptable alternative procedures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-260' style=';'><div id='questionWrap-260'  class='   watupro-question-id-25481'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>260. <\/span>The annual financial statements of a publicly held company have been audited, and its interim financial statements have been reviewed. <br \/>\r<br>Which of the following is true about the application of professional standards to this review?<\/div><input type='hidden' name='question_id[]' id='qID_260' value='25481' \/><input type='hidden' id='answerType25481' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25481[]' id='answer-id-105311' class='answer   answerof-25481 ' value='105311'   \/><label for='answer-id-105311' id='answer-label-105311' class=' answer'><span>PCAOB standards apply.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25481[]' id='answer-id-105312' class='answer   answerof-25481 ' value='105312'   \/><label for='answer-id-105312' id='answer-label-105312' class=' answer'><span>Statements on Standards for Accounting and Review Services apply.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25481[]' id='answer-id-105313' class='answer   answerof-25481 ' value='105313'   \/><label for='answer-id-105313' id='answer-label-105313' class=' answer'><span>Both PCAOB standards and SSARS apply.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25481[]' id='answer-id-105314' class='answer   answerof-25481 ' value='105314'   \/><label for='answer-id-105314' id='answer-label-105314' class=' answer'><span>None of the above.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-261' style=';'><div id='questionWrap-261'  class='   watupro-question-id-25482'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>261. <\/span>Which of the following is not a required procedure in an engagement to review the interim financial information of a publicly held entity?<\/div><input type='hidden' name='question_id[]' id='qID_261' value='25482' \/><input type='hidden' id='answerType25482' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25482[]' id='answer-id-105315' class='answer   answerof-25482 ' value='105315'   \/><label for='answer-id-105315' id='answer-label-105315' class=' answer'><span>Obtaining corroborating evidence about the entity's ability to continue as a going concern.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25482[]' id='answer-id-105316' class='answer   answerof-25482 ' value='105316'   \/><label for='answer-id-105316' id='answer-label-105316' class=' answer'><span>Comparing disaggregated revenue data for the current interim period with that of comparable prior periods.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25482[]' id='answer-id-105317' class='answer   answerof-25482 ' value='105317'   \/><label for='answer-id-105317' id='answer-label-105317' class=' answer'><span>Obtaining evidence that the interim financial information reconciles with the accounting records.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25482[]' id='answer-id-105318' class='answer   answerof-25482 ' value='105318'   \/><label for='answer-id-105318' id='answer-label-105318' class=' answer'><span>Inquiring of management about their knowledge of fraud or suspected fraud.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-262' style=';'><div id='questionWrap-262'  class='   watupro-question-id-25483'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>262. <\/span>In which case would the accountant be least likely to perform a review of interim financial information under PCAOB (auditing) standards?<\/div><input type='hidden' name='question_id[]' id='qID_262' value='25483' \/><input type='hidden' id='answerType25483' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25483[]' id='answer-id-105319' class='answer   answerof-25483 ' value='105319'   \/><label for='answer-id-105319' id='answer-label-105319' class=' answer'><span>Quarterly reports are required to be filed with the SE<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25483[]' id='answer-id-105320' class='answer   answerof-25483 ' value='105320'   \/><label for='answer-id-105320' id='answer-label-105320' class=' answer'><span>Selected quarterly financial data is included in an annual report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25483[]' id='answer-id-105321' class='answer   answerof-25483 ' value='105321'   \/><label for='answer-id-105321' id='answer-label-105321' class=' answer'><span>Quarterly financial data is included in the financial statements of a nonissuer.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25483[]' id='answer-id-105322' class='answer   answerof-25483 ' value='105322'   \/><label for='answer-id-105322' id='answer-label-105322' class=' answer'><span>The accountant is performing an initial audit of financial statements that include selected quarterly data.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-263' style=';'><div id='questionWrap-263'  class='   watupro-question-id-25484'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>263. <\/span>An independent accountant's report is based on a review of interim financial information. <br \/>\r<br>If this report is presented in a registration statement, a prospectus should include a statement clarifying that the:<\/div><input type='hidden' name='question_id[]' id='qID_263' value='25484' \/><input type='hidden' id='answerType25484' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25484[]' id='answer-id-105323' class='answer   answerof-25484 ' value='105323'   \/><label for='answer-id-105323' id='answer-label-105323' class=' answer'><span>Accountant's review report is not a part of the registration statement within the meaning of the Securities Act of 1933.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25484[]' id='answer-id-105324' class='answer   answerof-25484 ' value='105324'   \/><label for='answer-id-105324' id='answer-label-105324' class=' answer'><span>Accountant assumes no responsibility to update the report for events and circumstances occurring after the date of the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25484[]' id='answer-id-105325' class='answer   answerof-25484 ' value='105325'   \/><label for='answer-id-105325' id='answer-label-105325' class=' answer'><span>Accountant's review was performed in accordance with standards established by the Securities and Exchange Commission.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25484[]' id='answer-id-105326' class='answer   answerof-25484 ' value='105326'   \/><label for='answer-id-105326' id='answer-label-105326' class=' answer'><span>Accountant obtained corroborating evidence to determine whether material modifications are needed for such information to conform with GAA<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-264' style=';'><div id='questionWrap-264'  class='   watupro-question-id-25485'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>264. <\/span>The objective of a review of interim financial information of a public entity is to provide an accountant with a basis for reporting whether:<\/div><input type='hidden' name='question_id[]' id='qID_264' value='25485' \/><input type='hidden' id='answerType25485' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25485[]' id='answer-id-105327' class='answer   answerof-25485 ' value='105327'   \/><label for='answer-id-105327' id='answer-label-105327' class=' answer'><span>A reasonable basis exists for expressing an updated opinion regarding the financial statements that were previously audited.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25485[]' id='answer-id-105328' class='answer   answerof-25485 ' value='105328'   \/><label for='answer-id-105328' id='answer-label-105328' class=' answer'><span>Material modifications should be made to conform with generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25485[]' id='answer-id-105329' class='answer   answerof-25485 ' value='105329'   \/><label for='answer-id-105329' id='answer-label-105329' class=' answer'><span>The financial statements are presented fairly in accordance with standards of interim reporting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25485[]' id='answer-id-105330' class='answer   answerof-25485 ' value='105330'   \/><label for='answer-id-105330' id='answer-label-105330' class=' answer'><span>The financial statements are presented fairly in accordance with generally accepted accounting principles.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-265' style=';'><div id='questionWrap-265'  class='   watupro-question-id-25486'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>265. <\/span>The quarterly data required by SEC Regulation S-K have been omitted. <br \/>\r<br>Which of the following statements must be included in the auditor's report?<\/div><input type='hidden' name='question_id[]' id='qID_265' value='25486' \/><input type='hidden' id='answerType25486' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25486[]' id='answer-id-105331' class='answer   answerof-25486 ' value='105331'   \/><label for='answer-id-105331' id='answer-label-105331' class=' answer'><span>The auditor was unable to review the data.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25486[]' id='answer-id-105332' class='answer   answerof-25486 ' value='105332'   \/><label for='answer-id-105332' id='answer-label-105332' class=' answer'><span>The company's internal control provides an adequate basis to complete the review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25486[]' id='answer-id-105333' class='answer   answerof-25486 ' value='105333'   \/><label for='answer-id-105333' id='answer-label-105333' class=' answer'><span>The company has not presented the selected quarterly financial data.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25486[]' id='answer-id-105334' class='answer   answerof-25486 ' value='105334'   \/><label for='answer-id-105334' id='answer-label-105334' class=' answer'><span>The auditor will review the selected data during the review of the subsequent quarterly financial data.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-266' style=';'><div id='questionWrap-266'  class='   watupro-question-id-25487'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>266. <\/span>Which of the following matters is covered in a typical comfort letter?<\/div><input type='hidden' name='question_id[]' id='qID_266' value='25487' \/><input type='hidden' id='answerType25487' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25487[]' id='answer-id-105335' class='answer   answerof-25487 ' value='105335'   \/><label for='answer-id-105335' id='answer-label-105335' class=' answer'><span>Negative assurance concerning whether the entity's internal controls operated as designed during the period being audited.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25487[]' id='answer-id-105336' class='answer   answerof-25487 ' value='105336'   \/><label for='answer-id-105336' id='answer-label-105336' class=' answer'><span>An opinion regarding whether the entity complied with laws and regulations under Government Auditing Standards and the Single Audit Act of 1984.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25487[]' id='answer-id-105337' class='answer   answerof-25487 ' value='105337'   \/><label for='answer-id-105337' id='answer-label-105337' class=' answer'><span>Positive assurance concerning whether unaudited condensed financial information complied with generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25487[]' id='answer-id-105338' class='answer   answerof-25487 ' value='105338'   \/><label for='answer-id-105338' id='answer-label-105338' class=' answer'><span>An opinion as to whether the audited financial statements comply in form with the accounting requirements of the SE<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-267' style=';'><div id='questionWrap-267'  class='   watupro-question-id-25488'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>267. <\/span>Comfort letters ordinarily are signed by the client's:<\/div><input type='hidden' name='question_id[]' id='qID_267' value='25488' \/><input type='hidden' id='answerType25488' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25488[]' id='answer-id-105339' class='answer   answerof-25488 ' value='105339'   \/><label for='answer-id-105339' id='answer-label-105339' class=' answer'><span>Independent auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25488[]' id='answer-id-105340' class='answer   answerof-25488 ' value='105340'   \/><label for='answer-id-105340' id='answer-label-105340' class=' answer'><span>Underwriter of securities.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25488[]' id='answer-id-105341' class='answer   answerof-25488 ' value='105341'   \/><label for='answer-id-105341' id='answer-label-105341' class=' answer'><span>Audit committee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25488[]' id='answer-id-105342' class='answer   answerof-25488 ' value='105342'   \/><label for='answer-id-105342' id='answer-label-105342' class=' answer'><span>Senior management.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-268' style=';'><div id='questionWrap-268'  class='   watupro-question-id-25489'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>268. <\/span>When an accountant issues to an underwriter a comfort letter containing comments on data that have not been audited, the underwriter most likely will receive:<\/div><input type='hidden' name='question_id[]' id='qID_268' value='25489' \/><input type='hidden' id='answerType25489' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25489[]' id='answer-id-105343' class='answer   answerof-25489 ' value='105343'   \/><label for='answer-id-105343' id='answer-label-105343' class=' answer'><span>Negative assurance on capsule information.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25489[]' id='answer-id-105344' class='answer   answerof-25489 ' value='105344'   \/><label for='answer-id-105344' id='answer-label-105344' class=' answer'><span>Positive assurance on supplementary disclosures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25489[]' id='answer-id-105345' class='answer   answerof-25489 ' value='105345'   \/><label for='answer-id-105345' id='answer-label-105345' class=' answer'><span>A limited opinion on &quot;pro forma&quot; financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25489[]' id='answer-id-105346' class='answer   answerof-25489 ' value='105346'   \/><label for='answer-id-105346' id='answer-label-105346' class=' answer'><span>A disclaimer on prospective financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-269' style=';'><div id='questionWrap-269'  class='   watupro-question-id-25490'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>269. <\/span>Comfort letters ordinarily are: <br \/>\r<br><br><img decoding=\"async\" width=397 height=114 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image060.jpg\" v:shapes=\"_x0000_i1054\"><br><\/div><input type='hidden' name='question_id[]' id='qID_269' value='25490' \/><input type='hidden' id='answerType25490' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25490[]' id='answer-id-105347' class='answer   answerof-25490 ' value='105347'   \/><label for='answer-id-105347' id='answer-label-105347' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25490[]' id='answer-id-105348' class='answer   answerof-25490 ' value='105348'   \/><label for='answer-id-105348' id='answer-label-105348' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25490[]' id='answer-id-105349' class='answer   answerof-25490 ' value='105349'   \/><label for='answer-id-105349' id='answer-label-105349' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25490[]' id='answer-id-105350' class='answer   answerof-25490 ' value='105350'   \/><label for='answer-id-105350' id='answer-label-105350' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-270' style=';'><div id='questionWrap-270'  class='   watupro-question-id-25491'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>270. <\/span>A CPA in public practice is required to comply with the provisions of the Statements on Standards for Attestation Engagements (SSAE) when: <br \/>\r<br><br><img decoding=\"async\" width=523 height=131 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image062.jpg\" v:shapes=\"_x0000_i1055\"><br><\/div><input type='hidden' name='question_id[]' id='qID_270' value='25491' \/><input type='hidden' id='answerType25491' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25491[]' id='answer-id-105351' class='answer   answerof-25491 ' value='105351'   \/><label for='answer-id-105351' id='answer-label-105351' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25491[]' id='answer-id-105352' class='answer   answerof-25491 ' value='105352'   \/><label for='answer-id-105352' id='answer-label-105352' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25491[]' id='answer-id-105353' class='answer   answerof-25491 ' value='105353'   \/><label for='answer-id-105353' id='answer-label-105353' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25491[]' id='answer-id-105354' class='answer   answerof-25491 ' value='105354'   \/><label for='answer-id-105354' id='answer-label-105354' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-271' style=';'><div id='questionWrap-271'  class='   watupro-question-id-25492'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>271. <\/span>In an attest engagement, use of the accountant's report should be restricted to specified parties in all of the following situations, except:<\/div><input type='hidden' name='question_id[]' id='qID_271' value='25492' \/><input type='hidden' id='answerType25492' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25492[]' id='answer-id-105355' class='answer   answerof-25492 ' value='105355'   \/><label for='answer-id-105355' id='answer-label-105355' class=' answer'><span>When the criteria used to evaluate the subject matter are appropriate for only a limited number of parties.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25492[]' id='answer-id-105356' class='answer   answerof-25492 ' value='105356'   \/><label for='answer-id-105356' id='answer-label-105356' class=' answer'><span>When reporting on an assertion about the subject matter instead of reporting directly on the subject matter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25492[]' id='answer-id-105357' class='answer   answerof-25492 ' value='105357'   \/><label for='answer-id-105357' id='answer-label-105357' class=' answer'><span>When reporting directly on the subject matter and a written assertion has not been provided.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25492[]' id='answer-id-105358' class='answer   answerof-25492 ' value='105358'   \/><label for='answer-id-105358' id='answer-label-105358' class=' answer'><span>When reporting on an agreed-upon procedures engagement.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-272' style=';'><div id='questionWrap-272'  class='   watupro-question-id-25493'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>272. <\/span>Which of the following is a term for an attest engagement in which a CPA assesses a client's commercial Internet site for predefined criteria that are designed to measure transaction integrity, information protection, and disclosure of business practices?<\/div><input type='hidden' name='question_id[]' id='qID_272' value='25493' \/><input type='hidden' id='answerType25493' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25493[]' id='answer-id-105359' class='answer   answerof-25493 ' value='105359'   \/><label for='answer-id-105359' id='answer-label-105359' class=' answer'><span>ElectroNet.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25493[]' id='answer-id-105360' class='answer   answerof-25493 ' value='105360'   \/><label for='answer-id-105360' id='answer-label-105360' class=' answer'><span>EDIFAC<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25493[]' id='answer-id-105361' class='answer   answerof-25493 ' value='105361'   \/><label for='answer-id-105361' id='answer-label-105361' class=' answer'><span>TechSafe.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25493[]' id='answer-id-105362' class='answer   answerof-25493 ' value='105362'   \/><label for='answer-id-105362' id='answer-label-105362' class=' answer'><span>WebTrust.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-273' style=';'><div id='questionWrap-273'  class='   watupro-question-id-25494'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>273. <\/span>An entity engaged a CPA to determine whether the client's web sites meet defined criteria for standard business practices and controls over transaction integrity and information protection. <br \/>\r<br>In performing this engagement, the CPA should comply with the provisions of:<\/div><input type='hidden' name='question_id[]' id='qID_273' value='25494' \/><input type='hidden' id='answerType25494' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25494[]' id='answer-id-105363' class='answer   answerof-25494 ' value='105363'   \/><label for='answer-id-105363' id='answer-label-105363' class=' answer'><span>Statements on Assurance Standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25494[]' id='answer-id-105364' class='answer   answerof-25494 ' value='105364'   \/><label for='answer-id-105364' id='answer-label-105364' class=' answer'><span>Statements on Standards for Attestation Engagements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25494[]' id='answer-id-105365' class='answer   answerof-25494 ' value='105365'   \/><label for='answer-id-105365' id='answer-label-105365' class=' answer'><span>Statements on Standards for Management Consulting Services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25494[]' id='answer-id-105366' class='answer   answerof-25494 ' value='105366'   \/><label for='answer-id-105366' id='answer-label-105366' class=' answer'><span>Statements on Auditing Standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-274' style=';'><div id='questionWrap-274'  class='   watupro-question-id-25495'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>274. <\/span>A CPA's report on agreed-upon procedures related to management's assertion about an entity's compliance with specified requirements should contain:<\/div><input type='hidden' name='question_id[]' id='qID_274' value='25495' \/><input type='hidden' id='answerType25495' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25495[]' id='answer-id-105367' class='answer   answerof-25495 ' value='105367'   \/><label for='answer-id-105367' id='answer-label-105367' class=' answer'><span>A statement of limitations on the use of the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25495[]' id='answer-id-105368' class='answer   answerof-25495 ' value='105368'   \/><label for='answer-id-105368' id='answer-label-105368' class=' answer'><span>An opinion about whether management's assertion is fairly stated.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25495[]' id='answer-id-105369' class='answer   answerof-25495 ' value='105369'   \/><label for='answer-id-105369' id='answer-label-105369' class=' answer'><span>Negative assurance that control risk has not been assessed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25495[]' id='answer-id-105370' class='answer   answerof-25495 ' value='105370'   \/><label for='answer-id-105370' id='answer-label-105370' class=' answer'><span>An acknowledgment of responsibility for the sufficiency of the procedures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-275' style=';'><div id='questionWrap-275'  class='   watupro-question-id-25496'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>275. <\/span>An examination of a financial forecast is a professional service that involves:<\/div><input type='hidden' name='question_id[]' id='qID_275' value='25496' \/><input type='hidden' id='answerType25496' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25496[]' id='answer-id-105371' class='answer   answerof-25496 ' value='105371'   \/><label for='answer-id-105371' id='answer-label-105371' class=' answer'><span>Compiling or assembling a financial forecast that is based on management's assumptions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25496[]' id='answer-id-105372' class='answer   answerof-25496 ' value='105372'   \/><label for='answer-id-105372' id='answer-label-105372' class=' answer'><span>Limiting the distribution of the accountant's report to management and the board of directors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25496[]' id='answer-id-105373' class='answer   answerof-25496 ' value='105373'   \/><label for='answer-id-105373' id='answer-label-105373' class=' answer'><span>Assuming responsibility to update management on key events for one year after the report's date.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25496[]' id='answer-id-105374' class='answer   answerof-25496 ' value='105374'   \/><label for='answer-id-105374' id='answer-label-105374' class=' answer'><span>Evaluating the preparation of a financial forecast and the support underlying management's assumptions.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-276' style=';'><div id='questionWrap-276'  class='   watupro-question-id-25497'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>276. <\/span>An accountant may accept an engagement to apply agreed-upon procedures to prospective financial statements provided that:<\/div><input type='hidden' name='question_id[]' id='qID_276' value='25497' \/><input type='hidden' id='answerType25497' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25497[]' id='answer-id-105375' class='answer   answerof-25497 ' value='105375'   \/><label for='answer-id-105375' id='answer-label-105375' class=' answer'><span>Use of the report is restricted to the specified parties.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25497[]' id='answer-id-105376' class='answer   answerof-25497 ' value='105376'   \/><label for='answer-id-105376' id='answer-label-105376' class=' answer'><span>The prospective financial statements are also examined.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25497[]' id='answer-id-105377' class='answer   answerof-25497 ' value='105377'   \/><label for='answer-id-105377' id='answer-label-105377' class=' answer'><span>Responsibility for the adequacy of the procedures performed is taken by the accountant.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25497[]' id='answer-id-105378' class='answer   answerof-25497 ' value='105378'   \/><label for='answer-id-105378' id='answer-label-105378' class=' answer'><span>Negative assurance is expressed on the prospective financial statements taken as a whole.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-277' style=';'><div id='questionWrap-277'  class='   watupro-question-id-25498'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>277. <\/span>An accountant's compilation report on a financial forecast should include a statement that:<\/div><input type='hidden' name='question_id[]' id='qID_277' value='25498' \/><input type='hidden' id='answerType25498' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25498[]' id='answer-id-105379' class='answer   answerof-25498 ' value='105379'   \/><label for='answer-id-105379' id='answer-label-105379' class=' answer'><span>The forecast should be read only in conjunction with the audited historical financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25498[]' id='answer-id-105380' class='answer   answerof-25498 ' value='105380'   \/><label for='answer-id-105380' id='answer-label-105380' class=' answer'><span>The accountant expresses only limited assurance on the forecasted statements and their assumptions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25498[]' id='answer-id-105381' class='answer   answerof-25498 ' value='105381'   \/><label for='answer-id-105381' id='answer-label-105381' class=' answer'><span>There will usually be differences between the forecasted and actual results.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25498[]' id='answer-id-105382' class='answer   answerof-25498 ' value='105382'   \/><label for='answer-id-105382' id='answer-label-105382' class=' answer'><span>The hypothetical assumptions used in the forecast are reasonable in the circumstances.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-278' style=';'><div id='questionWrap-278'  class='   watupro-question-id-25499'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>278. <\/span>Which of the following is a conceptual difference between the attestation standards and generally accepted auditing standards?<\/div><input type='hidden' name='question_id[]' id='qID_278' value='25499' \/><input type='hidden' id='answerType25499' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25499[]' id='answer-id-105383' class='answer   answerof-25499 ' value='105383'   \/><label for='answer-id-105383' id='answer-label-105383' class=' answer'><span>The attestation standards provide a framework for the attest function beyond historical financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25499[]' id='answer-id-105384' class='answer   answerof-25499 ' value='105384'   \/><label for='answer-id-105384' id='answer-label-105384' class=' answer'><span>The requirement that the practitioner be independent in mental attitude is omitted from the attestation standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25499[]' id='answer-id-105385' class='answer   answerof-25499 ' value='105385'   \/><label for='answer-id-105385' id='answer-label-105385' class=' answer'><span>The attestation standards do not permit an attest engagement to be part of a business acquisition study or a feasibility study.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25499[]' id='answer-id-105386' class='answer   answerof-25499 ' value='105386'   \/><label for='answer-id-105386' id='answer-label-105386' class=' answer'><span>None of the standards of fieldwork in generally accepted auditing standards are included in the attestation standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-279' style=';'><div id='questionWrap-279'  class='   watupro-question-id-25500'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>279. <\/span>An accountant's report on a review of pro forma financial information should include a:<\/div><input type='hidden' name='question_id[]' id='qID_279' value='25500' \/><input type='hidden' id='answerType25500' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25500[]' id='answer-id-105387' class='answer   answerof-25500 ' value='105387'   \/><label for='answer-id-105387' id='answer-label-105387' class=' answer'><span>Statement that the entity's internal control was not relied on in the review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25500[]' id='answer-id-105388' class='answer   answerof-25500 ' value='105388'   \/><label for='answer-id-105388' id='answer-label-105388' class=' answer'><span>Disclaimer of opinion on the financial statements from which the pro forma financial information is derived.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25500[]' id='answer-id-105389' class='answer   answerof-25500 ' value='105389'   \/><label for='answer-id-105389' id='answer-label-105389' class=' answer'><span>Caveat that it is uncertain whether the transaction or event reflected in the pro forma financial information will ever occur.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25500[]' id='answer-id-105390' class='answer   answerof-25500 ' value='105390'   \/><label for='answer-id-105390' id='answer-label-105390' class=' answer'><span>Reference to the financial statements from which the historical financial information is derived.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-280' style=';'><div id='questionWrap-280'  class='   watupro-question-id-25501'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>280. <\/span>In performing an attest engagement, a CPA typically:<\/div><input type='hidden' name='question_id[]' id='qID_280' value='25501' \/><input type='hidden' id='answerType25501' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25501[]' id='answer-id-105391' class='answer   answerof-25501 ' value='105391'   \/><label for='answer-id-105391' id='answer-label-105391' class=' answer'><span>Supplies litigation support services.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25501[]' id='answer-id-105392' class='answer   answerof-25501 ' value='105392'   \/><label for='answer-id-105392' id='answer-label-105392' class=' answer'><span>Assesses control risk at a low level.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25501[]' id='answer-id-105393' class='answer   answerof-25501 ' value='105393'   \/><label for='answer-id-105393' id='answer-label-105393' class=' answer'><span>Issues a report on subject matter (or on an assertion about subject matter) that is the responsibility of another party.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25501[]' id='answer-id-105394' class='answer   answerof-25501 ' value='105394'   \/><label for='answer-id-105394' id='answer-label-105394' class=' answer'><span>Provides management consulting advice.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-281' style=';'><div id='questionWrap-281'  class='   watupro-question-id-25502'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>281. <\/span>An accountant's standard report on a compilation of a projection should not include a:<\/div><input type='hidden' name='question_id[]' id='qID_281' value='25502' \/><input type='hidden' id='answerType25502' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25502[]' id='answer-id-105395' class='answer   answerof-25502 ' value='105395'   \/><label for='answer-id-105395' id='answer-label-105395' class=' answer'><span>Statement that a compilation of a projection is limited in scope.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25502[]' id='answer-id-105396' class='answer   answerof-25502 ' value='105396'   \/><label for='answer-id-105396' id='answer-label-105396' class=' answer'><span>Disclaimer of responsibility to update the report for events occurring after the report's date.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25502[]' id='answer-id-105397' class='answer   answerof-25502 ' value='105397'   \/><label for='answer-id-105397' id='answer-label-105397' class=' answer'><span>Statement that the accountant expresses only limited assurance that the results may be achieved.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25502[]' id='answer-id-105398' class='answer   answerof-25502 ' value='105398'   \/><label for='answer-id-105398' id='answer-label-105398' class=' answer'><span>Separate paragraph that describes the limitations on the presentation's usefulness.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-282' style=';'><div id='questionWrap-282'  class='   watupro-question-id-25503'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>282. <\/span>Which of the following is not an attestation standard?<\/div><input type='hidden' name='question_id[]' id='qID_282' value='25503' \/><input type='hidden' id='answerType25503' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25503[]' id='answer-id-105399' class='answer   answerof-25503 ' value='105399'   \/><label for='answer-id-105399' id='answer-label-105399' class=' answer'><span>Sufficient evidence shall be obtained to provide a reasonable basis for the conclusion that is expressed in the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25503[]' id='answer-id-105400' class='answer   answerof-25503 ' value='105400'   \/><label for='answer-id-105400' id='answer-label-105400' class=' answer'><span>The report shall identify the assertion being reported on and state the character of the engagement.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25503[]' id='answer-id-105401' class='answer   answerof-25503 ' value='105401'   \/><label for='answer-id-105401' id='answer-label-105401' class=' answer'><span>The work shall be adequately planned and assistants, if any, shall be properly supervised.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25503[]' id='answer-id-105402' class='answer   answerof-25503 ' value='105402'   \/><label for='answer-id-105402' id='answer-label-105402' class=' answer'><span>A sufficient understanding of internal control shall be obtained to plan the engagement.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-283' style=';'><div id='questionWrap-283'  class='   watupro-question-id-25504'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>283. <\/span>An accountant's compilation report on a financial forecast should include a statement that the:<\/div><input type='hidden' name='question_id[]' id='qID_283' value='25504' \/><input type='hidden' id='answerType25504' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25504[]' id='answer-id-105403' class='answer   answerof-25504 ' value='105403'   \/><label for='answer-id-105403' id='answer-label-105403' class=' answer'><span>Compilation does not include evaluation of the support of the assumptions underlying the forecast.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25504[]' id='answer-id-105404' class='answer   answerof-25504 ' value='105404'   \/><label for='answer-id-105404' id='answer-label-105404' class=' answer'><span>Hypothetical assumptions used in the forecast are reasonable.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25504[]' id='answer-id-105405' class='answer   answerof-25504 ' value='105405'   \/><label for='answer-id-105405' id='answer-label-105405' class=' answer'><span>Range of assumptions selected is one in which one end of the range is less likely to occur than the other.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25504[]' id='answer-id-105406' class='answer   answerof-25504 ' value='105406'   \/><label for='answer-id-105406' id='answer-label-105406' class=' answer'><span>Prospective statements are limited to presenting, in the form of a forecast, information that is the accountant's representation.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-284' style=';'><div id='questionWrap-284'  class='   watupro-question-id-25505'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>284. <\/span>An attest engagement is one in which a CPA is engaged to:<\/div><input type='hidden' name='question_id[]' id='qID_284' value='25505' \/><input type='hidden' id='answerType25505' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25505[]' id='answer-id-105407' class='answer   answerof-25505 ' value='105407'   \/><label for='answer-id-105407' id='answer-label-105407' class=' answer'><span>Issue an examination, a review, or an agreed-upon procedures report on subject matter, or on an assertion about the subject matter, that is the responsibility of another party.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25505[]' id='answer-id-105408' class='answer   answerof-25505 ' value='105408'   \/><label for='answer-id-105408' id='answer-label-105408' class=' answer'><span>Provide tax advice or prepare a tax return based on financial information the CPA has not audited or reviewed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25505[]' id='answer-id-105409' class='answer   answerof-25505 ' value='105409'   \/><label for='answer-id-105409' id='answer-label-105409' class=' answer'><span>Testify as an expert witness in accounting, auditing, or tax matters, given certain stipulated facts.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25505[]' id='answer-id-105410' class='answer   answerof-25505 ' value='105410'   \/><label for='answer-id-105410' id='answer-label-105410' class=' answer'><span>Assemble the financial statements of a nonissuer based on the assumptions of the entity's management without expressing any assurance.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-285' style=';'><div id='questionWrap-285'  class='   watupro-question-id-25506'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>285. <\/span>Which of the following professional services would be considered an attest engagement?<\/div><input type='hidden' name='question_id[]' id='qID_285' value='25506' \/><input type='hidden' id='answerType25506' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25506[]' id='answer-id-105411' class='answer   answerof-25506 ' value='105411'   \/><label for='answer-id-105411' id='answer-label-105411' class=' answer'><span>A management consulting engagement to provide EDP advice to a client.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25506[]' id='answer-id-105412' class='answer   answerof-25506 ' value='105412'   \/><label for='answer-id-105412' id='answer-label-105412' class=' answer'><span>An engagement to report on management's discussion and analysis (MD&amp;A).<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25506[]' id='answer-id-105413' class='answer   answerof-25506 ' value='105413'   \/><label for='answer-id-105413' id='answer-label-105413' class=' answer'><span>An income tax engagement to prepare federal and state tax returns.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25506[]' id='answer-id-105414' class='answer   answerof-25506 ' value='105414'   \/><label for='answer-id-105414' id='answer-label-105414' class=' answer'><span>The compilation of financial statements from a client's accounting records.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-286' style=';'><div id='questionWrap-286'  class='   watupro-question-id-25507'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>286. <\/span>Which of the following statements concerning prospective financial statements is correct?<\/div><input type='hidden' name='question_id[]' id='qID_286' value='25507' \/><input type='hidden' id='answerType25507' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25507[]' id='answer-id-105415' class='answer   answerof-25507 ' value='105415'   \/><label for='answer-id-105415' id='answer-label-105415' class=' answer'><span>Only a financial forecast would normally be appropriate for limited use.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25507[]' id='answer-id-105416' class='answer   answerof-25507 ' value='105416'   \/><label for='answer-id-105416' id='answer-label-105416' class=' answer'><span>Only a financial projection would normally be appropriate for general use.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25507[]' id='answer-id-105417' class='answer   answerof-25507 ' value='105417'   \/><label for='answer-id-105417' id='answer-label-105417' class=' answer'><span>Any type of prospective financial statements would normally be appropriate for limited use.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25507[]' id='answer-id-105418' class='answer   answerof-25507 ' value='105418'   \/><label for='answer-id-105418' id='answer-label-105418' class=' answer'><span>Any type of prospective financial statements would normally be appropriate for general use.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-287' style=';'><div id='questionWrap-287'  class='   watupro-question-id-25508'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>287. <\/span>Negative assurance may be expressed when an accountant is requested to report on the:<\/div><input type='hidden' name='question_id[]' id='qID_287' value='25508' \/><input type='hidden' id='answerType25508' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25508[]' id='answer-id-105419' class='answer   answerof-25508 ' value='105419'   \/><label for='answer-id-105419' id='answer-label-105419' class=' answer'><span>Compilation of prospective financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25508[]' id='answer-id-105420' class='answer   answerof-25508 ' value='105420'   \/><label for='answer-id-105420' id='answer-label-105420' class=' answer'><span>Compliance with the provisions of the Foreign Corrupt Practices Act.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25508[]' id='answer-id-105421' class='answer   answerof-25508 ' value='105421'   \/><label for='answer-id-105421' id='answer-label-105421' class=' answer'><span>Results of performing a review of management's assertion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25508[]' id='answer-id-105422' class='answer   answerof-25508 ' value='105422'   \/><label for='answer-id-105422' id='answer-label-105422' class=' answer'><span>Audit of historical financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-288' style=';'><div id='questionWrap-288'  class='   watupro-question-id-25509'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>288. <\/span>When an accountant examines a financial forecast that fails to disclose several significant assumptions used to prepare the forecast, the accountant should describe the assumptions in the accountant's report and issue a (an):<\/div><input type='hidden' name='question_id[]' id='qID_288' value='25509' \/><input type='hidden' id='answerType25509' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25509[]' id='answer-id-105423' class='answer   answerof-25509 ' value='105423'   \/><label for='answer-id-105423' id='answer-label-105423' class=' answer'><span>&quot;Except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25509[]' id='answer-id-105424' class='answer   answerof-25509 ' value='105424'   \/><label for='answer-id-105424' id='answer-label-105424' class=' answer'><span>&quot;Subject to&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25509[]' id='answer-id-105425' class='answer   answerof-25509 ' value='105425'   \/><label for='answer-id-105425' id='answer-label-105425' class=' answer'><span>Unqualified opinion with a separate explanatory paragraph.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25509[]' id='answer-id-105426' class='answer   answerof-25509 ' value='105426'   \/><label for='answer-id-105426' id='answer-label-105426' class=' answer'><span>Adverse opinion.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-289' style=';'><div id='questionWrap-289'  class='   watupro-question-id-25510'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>289. <\/span>Prospective financial information presented in the format of historical financial statements that omit either gross profit or net income is deemed to be a:<\/div><input type='hidden' name='question_id[]' id='qID_289' value='25510' \/><input type='hidden' id='answerType25510' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25510[]' id='answer-id-105427' class='answer   answerof-25510 ' value='105427'   \/><label for='answer-id-105427' id='answer-label-105427' class=' answer'><span>Partial presentation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25510[]' id='answer-id-105428' class='answer   answerof-25510 ' value='105428'   \/><label for='answer-id-105428' id='answer-label-105428' class=' answer'><span>Projected balance sheet.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25510[]' id='answer-id-105429' class='answer   answerof-25510 ' value='105429'   \/><label for='answer-id-105429' id='answer-label-105429' class=' answer'><span>Financial forecast.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25510[]' id='answer-id-105430' class='answer   answerof-25510 ' value='105430'   \/><label for='answer-id-105430' id='answer-label-105430' class=' answer'><span>Financial projection.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-290' style=';'><div id='questionWrap-290'  class='   watupro-question-id-25511'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>290. <\/span>Which of the following activities would most likely be considered an attestation engagement?<\/div><input type='hidden' name='question_id[]' id='qID_290' value='25511' \/><input type='hidden' id='answerType25511' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25511[]' id='answer-id-105431' class='answer   answerof-25511 ' value='105431'   \/><label for='answer-id-105431' id='answer-label-105431' class=' answer'><span>Consulting with management representatives of a firm to provide advice.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25511[]' id='answer-id-105432' class='answer   answerof-25511 ' value='105432'   \/><label for='answer-id-105432' id='answer-label-105432' class=' answer'><span>Issuing a report about a firm's compliance with laws and regulations.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25511[]' id='answer-id-105433' class='answer   answerof-25511 ' value='105433'   \/><label for='answer-id-105433' id='answer-label-105433' class=' answer'><span>Advocating a client's position on tax matters that are being reviewed by the IR<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25511[]' id='answer-id-105434' class='answer   answerof-25511 ' value='105434'   \/><label for='answer-id-105434' id='answer-label-105434' class=' answer'><span>Preparing a client's tax returns.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-291' style=';'><div id='questionWrap-291'  class='   watupro-question-id-25512'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>291. <\/span>Which of the following professional services would be considered an attestation engagement?<\/div><input type='hidden' name='question_id[]' id='qID_291' value='25512' \/><input type='hidden' id='answerType25512' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25512[]' id='answer-id-105435' class='answer   answerof-25512 ' value='105435'   \/><label for='answer-id-105435' id='answer-label-105435' class=' answer'><span>Advocating on behalf of a client about trust tax matters under review by the Internal Revenue Service.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25512[]' id='answer-id-105436' class='answer   answerof-25512 ' value='105436'   \/><label for='answer-id-105436' id='answer-label-105436' class=' answer'><span>Providing financial analysis, planning, and capital acquisition services as a part-time, in-house controller.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25512[]' id='answer-id-105437' class='answer   answerof-25512 ' value='105437'   \/><label for='answer-id-105437' id='answer-label-105437' class=' answer'><span>Advising management in the selection of a computer system to meet business needs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25512[]' id='answer-id-105438' class='answer   answerof-25512 ' value='105438'   \/><label for='answer-id-105438' id='answer-label-105438' class=' answer'><span>Preparing the income statement and balance sheet for one year in the future based on client expectations and predictions.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-292' style=';'><div id='questionWrap-292'  class='   watupro-question-id-25513'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>292. <\/span>Which of the following is a professional engagement that a CPA may perform to provide assurance on a system's reliability?<\/div><input type='hidden' name='question_id[]' id='qID_292' value='25513' \/><input type='hidden' id='answerType25513' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25513[]' id='answer-id-105439' class='answer   answerof-25513 ' value='105439'   \/><label for='answer-id-105439' id='answer-label-105439' class=' answer'><span>MAS AssurAbility.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25513[]' id='answer-id-105440' class='answer   answerof-25513 ' value='105440'   \/><label for='answer-id-105440' id='answer-label-105440' class=' answer'><span>CPA WebMaster.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25513[]' id='answer-id-105441' class='answer   answerof-25513 ' value='105441'   \/><label for='answer-id-105441' id='answer-label-105441' class=' answer'><span>MAS AttestSure.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25513[]' id='answer-id-105442' class='answer   answerof-25513 ' value='105442'   \/><label for='answer-id-105442' id='answer-label-105442' class=' answer'><span>CPA SysTrust.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-293' style=';'><div id='questionWrap-293'  class='   watupro-question-id-25514'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>293. <\/span>An accountant's standard report on a compilation of a projection should not include a statement that:<\/div><input type='hidden' name='question_id[]' id='qID_293' value='25514' \/><input type='hidden' id='answerType25514' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25514[]' id='answer-id-105443' class='answer   answerof-25514 ' value='105443'   \/><label for='answer-id-105443' id='answer-label-105443' class=' answer'><span>There will usually be differences between the forecasted and actual results.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25514[]' id='answer-id-105444' class='answer   answerof-25514 ' value='105444'   \/><label for='answer-id-105444' id='answer-label-105444' class=' answer'><span>The hypothetical assumptions used in the projection are reasonable in the circumstances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25514[]' id='answer-id-105445' class='answer   answerof-25514 ' value='105445'   \/><label for='answer-id-105445' id='answer-label-105445' class=' answer'><span>The accountant has no responsibility to update the report for future events and circumstances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25514[]' id='answer-id-105446' class='answer   answerof-25514 ' value='105446'   \/><label for='answer-id-105446' id='answer-label-105446' class=' answer'><span>The compilation of a projection is limited in scope.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-294' style=';'><div id='questionWrap-294'  class='   watupro-question-id-25515'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>294. <\/span>A practitioner's report on agreed-upon procedures that is in the form of procedures and findings should contain:<\/div><input type='hidden' name='question_id[]' id='qID_294' value='25515' \/><input type='hidden' id='answerType25515' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25515[]' id='answer-id-105447' class='answer   answerof-25515 ' value='105447'   \/><label for='answer-id-105447' id='answer-label-105447' class=' answer'><span>Negative assurance that the procedures did not necessarily disclose all significant deficiencies in internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25515[]' id='answer-id-105448' class='answer   answerof-25515 ' value='105448'   \/><label for='answer-id-105448' id='answer-label-105448' class=' answer'><span>An acknowledgment of the practitioner's responsibility for the sufficiency of the procedures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25515[]' id='answer-id-105449' class='answer   answerof-25515 ' value='105449'   \/><label for='answer-id-105449' id='answer-label-105449' class=' answer'><span>A statement of restrictions on the use of the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25515[]' id='answer-id-105450' class='answer   answerof-25515 ' value='105450'   \/><label for='answer-id-105450' id='answer-label-105450' class=' answer'><span>A disclaimer of opinion on the entity's financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-295' style=';'><div id='questionWrap-295'  class='   watupro-question-id-25516'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>295. <\/span>When an accountant compiles projected financial statements, the accountant's report should include a separate paragraph that:<\/div><input type='hidden' name='question_id[]' id='qID_295' value='25516' \/><input type='hidden' id='answerType25516' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25516[]' id='answer-id-105451' class='answer   answerof-25516 ' value='105451'   \/><label for='answer-id-105451' id='answer-label-105451' class=' answer'><span>Explains the difference between a compilation and a review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25516[]' id='answer-id-105452' class='answer   answerof-25516 ' value='105452'   \/><label for='answer-id-105452' id='answer-label-105452' class=' answer'><span>Documents the assessment of the risk of material misstatement due to fraud.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25516[]' id='answer-id-105453' class='answer   answerof-25516 ' value='105453'   \/><label for='answer-id-105453' id='answer-label-105453' class=' answer'><span>Expresses limited assurance that the actual results may be within the projected range.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25516[]' id='answer-id-105454' class='answer   answerof-25516 ' value='105454'   \/><label for='answer-id-105454' id='answer-label-105454' class=' answer'><span>Describes the limitations on the projection's usefulness.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-296' style=';'><div id='questionWrap-296'  class='   watupro-question-id-25517'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>296. <\/span>A CPA is engaged to examine management's assertion that the entity's schedule of investment returns is presented in accordance with specific criteria. <br \/>\r<br>In performing this engagement, the CPA should comply with the provisions of:<\/div><input type='hidden' name='question_id[]' id='qID_296' value='25517' \/><input type='hidden' id='answerType25517' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25517[]' id='answer-id-105455' class='answer   answerof-25517 ' value='105455'   \/><label for='answer-id-105455' id='answer-label-105455' class=' answer'><span>Statements on Standards for Accounting and Review Services (SSARS).<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25517[]' id='answer-id-105456' class='answer   answerof-25517 ' value='105456'   \/><label for='answer-id-105456' id='answer-label-105456' class=' answer'><span>Statements on Auditing Standards (SAS).<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25517[]' id='answer-id-105457' class='answer   answerof-25517 ' value='105457'   \/><label for='answer-id-105457' id='answer-label-105457' class=' answer'><span>Statements on Standards for Consulting Services (SSCS).<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25517[]' id='answer-id-105458' class='answer   answerof-25517 ' value='105458'   \/><label for='answer-id-105458' id='answer-label-105458' class=' answer'><span>Statements on Standards for Attestation Engagements (SSAE).<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-297' style=';'><div id='questionWrap-297'  class='   watupro-question-id-25518'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>297. <\/span>An accountant may accept an engagement to apply agreed-upon procedures to prospective financial statements provided the:<\/div><input type='hidden' name='question_id[]' id='qID_297' value='25518' \/><input type='hidden' id='answerType25518' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25518[]' id='answer-id-105459' class='answer   answerof-25518 ' value='105459'   \/><label for='answer-id-105459' id='answer-label-105459' class=' answer'><span>Provisions of Statements on Standards for Accounting and Review Services (SSARS) are followed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25518[]' id='answer-id-105460' class='answer   answerof-25518 ' value='105460'   \/><label for='answer-id-105460' id='answer-label-105460' class=' answer'><span>Accountant also examines the prospective financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25518[]' id='answer-id-105461' class='answer   answerof-25518 ' value='105461'   \/><label for='answer-id-105461' id='answer-label-105461' class=' answer'><span>Distribution (use) of the report is restricted to the specified users.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25518[]' id='answer-id-105462' class='answer   answerof-25518 ' value='105462'   \/><label for='answer-id-105462' id='answer-label-105462' class=' answer'><span>The accountant takes responsibility for the adequacy of the procedures performed.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-298' style=';'><div id='questionWrap-298'  class='   watupro-question-id-25519'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>298. <\/span>Accepting an engagement to compile a financial projection for a publicly held company most likely would be inappropriate if the projection were to be distributed to:<\/div><input type='hidden' name='question_id[]' id='qID_298' value='25519' \/><input type='hidden' id='answerType25519' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25519[]' id='answer-id-105463' class='answer   answerof-25519 ' value='105463'   \/><label for='answer-id-105463' id='answer-label-105463' class=' answer'><span>A bank with which the entity is negotiating for a loan.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25519[]' id='answer-id-105464' class='answer   answerof-25519 ' value='105464'   \/><label for='answer-id-105464' id='answer-label-105464' class=' answer'><span>A labor union with which the entity is negotiating a contract.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25519[]' id='answer-id-105465' class='answer   answerof-25519 ' value='105465'   \/><label for='answer-id-105465' id='answer-label-105465' class=' answer'><span>The principal stockholder, to the exclusion of the other stockholders.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25519[]' id='answer-id-105466' class='answer   answerof-25519 ' value='105466'   \/><label for='answer-id-105466' id='answer-label-105466' class=' answer'><span>All stockholders of record as of the report date.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-299' style=';'><div id='questionWrap-299'  class='   watupro-question-id-25520'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>299. <\/span>When an accountant compiles projected financial statements, the accountant's report should include a separate paragraph that:<\/div><input type='hidden' name='question_id[]' id='qID_299' value='25520' \/><input type='hidden' id='answerType25520' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25520[]' id='answer-id-105467' class='answer   answerof-25520 ' value='105467'   \/><label for='answer-id-105467' id='answer-label-105467' class=' answer'><span>Describes the differences between a projection and a forecast.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25520[]' id='answer-id-105468' class='answer   answerof-25520 ' value='105468'   \/><label for='answer-id-105468' id='answer-label-105468' class=' answer'><span>Identifies the accounting principles used by management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25520[]' id='answer-id-105469' class='answer   answerof-25520 ' value='105469'   \/><label for='answer-id-105469' id='answer-label-105469' class=' answer'><span>Expresses limited assurance that the actual results may be within the projection's range.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25520[]' id='answer-id-105470' class='answer   answerof-25520 ' value='105470'   \/><label for='answer-id-105470' id='answer-label-105470' class=' answer'><span>Describes the limitations on the projection's usefulness.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-300' style=';'><div id='questionWrap-300'  class='   watupro-question-id-25521'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>300. <\/span>A CPA firm should establish procedures for conducting and supervising work at all organizational levels to provide reasonable assurance that the work performed meets the firm's standards of quality. <br \/>\r<br>To achieve this goal, the firm most likely would establish procedures for:<\/div><input type='hidden' name='question_id[]' id='qID_300' value='25521' \/><input type='hidden' id='answerType25521' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25521[]' id='answer-id-105471' class='answer   answerof-25521 ' value='105471'   \/><label for='answer-id-105471' id='answer-label-105471' class=' answer'><span>Evaluating prospective and continuing client relationships.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25521[]' id='answer-id-105472' class='answer   answerof-25521 ' value='105472'   \/><label for='answer-id-105472' id='answer-label-105472' class=' answer'><span>Reviewing audit documentation and engagement reports.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25521[]' id='answer-id-105473' class='answer   answerof-25521 ' value='105473'   \/><label for='answer-id-105473' id='answer-label-105473' class=' answer'><span>Requiring personnel to adhere to the applicable independence rules.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25521[]' id='answer-id-105474' class='answer   answerof-25521 ' value='105474'   \/><label for='answer-id-105474' id='answer-label-105474' class=' answer'><span>Maintaining personnel files containing documentation related to the evaluation of personnel.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-301' style=';'><div id='questionWrap-301'  class='   watupro-question-id-25522'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>301. <\/span>Which of the following are elements of a CPA firm's quality control that should be considered in establishing its quality control policies and procedures? <br \/>\r<br><br><img decoding=\"async\" width=498 height=95 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image064.jpg\" v:shapes=\"_x0000_i1056\"><br><\/div><input type='hidden' name='question_id[]' id='qID_301' value='25522' \/><input type='hidden' id='answerType25522' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25522[]' id='answer-id-105475' class='answer   answerof-25522 ' value='105475'   \/><label for='answer-id-105475' id='answer-label-105475' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25522[]' id='answer-id-105476' class='answer   answerof-25522 ' value='105476'   \/><label for='answer-id-105476' id='answer-label-105476' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25522[]' id='answer-id-105477' class='answer   answerof-25522 ' value='105477'   \/><label for='answer-id-105477' id='answer-label-105477' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25522[]' id='answer-id-105478' class='answer   answerof-25522 ' value='105478'   \/><label for='answer-id-105478' id='answer-label-105478' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-302' style=';'><div id='questionWrap-302'  class='   watupro-question-id-25523'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>302. <\/span>A CPA firm would be reasonably assured of meeting its responsibility to provide services that conform with professional standards by:<\/div><input type='hidden' name='question_id[]' id='qID_302' value='25523' \/><input type='hidden' id='answerType25523' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25523[]' id='answer-id-105479' class='answer   answerof-25523 ' value='105479'   \/><label for='answer-id-105479' id='answer-label-105479' class=' answer'><span>Adhering to generally accepted auditing standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25523[]' id='answer-id-105480' class='answer   answerof-25523 ' value='105480'   \/><label for='answer-id-105480' id='answer-label-105480' class=' answer'><span>Having an appropriate system of quality control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25523[]' id='answer-id-105481' class='answer   answerof-25523 ' value='105481'   \/><label for='answer-id-105481' id='answer-label-105481' class=' answer'><span>Joining professional societies that enforce ethical conduct.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25523[]' id='answer-id-105482' class='answer   answerof-25523 ' value='105482'   \/><label for='answer-id-105482' id='answer-label-105482' class=' answer'><span>Maintaining an attitude of independence in its engagements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-303' style=';'><div id='questionWrap-303'  class='   watupro-question-id-25524'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>303. <\/span>One of a CPA firm's basic objectives is to provide professional services that conform with professional standards. <br \/>\r<br>Reasonable assurance of achieving this basic objective is provided through:<\/div><input type='hidden' name='question_id[]' id='qID_303' value='25524' \/><input type='hidden' id='answerType25524' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25524[]' id='answer-id-105483' class='answer   answerof-25524 ' value='105483'   \/><label for='answer-id-105483' id='answer-label-105483' class=' answer'><span>A system of quality control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25524[]' id='answer-id-105484' class='answer   answerof-25524 ' value='105484'   \/><label for='answer-id-105484' id='answer-label-105484' class=' answer'><span>A system of peer review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25524[]' id='answer-id-105485' class='answer   answerof-25524 ' value='105485'   \/><label for='answer-id-105485' id='answer-label-105485' class=' answer'><span>Continuing professional education.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25524[]' id='answer-id-105486' class='answer   answerof-25524 ' value='105486'   \/><label for='answer-id-105486' id='answer-label-105486' class=' answer'><span>Compliance with generally accepted reporting standards.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-304' style=';'><div id='questionWrap-304'  class='   watupro-question-id-25525'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>304. <\/span>Which of the following is not a comprehensive basis of accounting other than generally accepted accounting principles?<\/div><input type='hidden' name='question_id[]' id='qID_304' value='25525' \/><input type='hidden' id='answerType25525' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25525[]' id='answer-id-105487' class='answer   answerof-25525 ' value='105487'   \/><label for='answer-id-105487' id='answer-label-105487' class=' answer'><span>Cash receipts and disbursements basis of accounting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25525[]' id='answer-id-105488' class='answer   answerof-25525 ' value='105488'   \/><label for='answer-id-105488' id='answer-label-105488' class=' answer'><span>Basis of accounting used by an entity to file its income tax return.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25525[]' id='answer-id-105489' class='answer   answerof-25525 ' value='105489'   \/><label for='answer-id-105489' id='answer-label-105489' class=' answer'><span>Basis of accounting used by an entity to comply with the financial reporting requirements of a government regulatory agency.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25525[]' id='answer-id-105490' class='answer   answerof-25525 ' value='105490'   \/><label for='answer-id-105490' id='answer-label-105490' class=' answer'><span>Basis of accounting used by an entity to comply with the financial reporting requirements of a lending institution.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-305' style=';'><div id='questionWrap-305'  class='   watupro-question-id-25526'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>305. <\/span>Which of the following accounting bases may be used to prepare financial statements in conformity with a comprehensive basis of accounting other than generally accepted accounting principles? <br \/>\r<br>I. Basis of accounting used by an entity to file its income tax return. <br \/>\r<br>II. Cash receipts and disbursements basis of accounting.<\/div><input type='hidden' name='question_id[]' id='qID_305' value='25526' \/><input type='hidden' id='answerType25526' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25526[]' id='answer-id-105491' class='answer   answerof-25526 ' value='105491'   \/><label for='answer-id-105491' id='answer-label-105491' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25526[]' id='answer-id-105492' class='answer   answerof-25526 ' value='105492'   \/><label for='answer-id-105492' id='answer-label-105492' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25526[]' id='answer-id-105493' class='answer   answerof-25526 ' value='105493'   \/><label for='answer-id-105493' id='answer-label-105493' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25526[]' id='answer-id-105494' class='answer   answerof-25526 ' value='105494'   \/><label for='answer-id-105494' id='answer-label-105494' class=' answer'><span>Neither I nor I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-306' style=';'><div id='questionWrap-306'  class='   watupro-question-id-25527'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>306. <\/span>A CPA is required to comply with the provisions of Statements on Standards for Accounting and Review Services when: <br \/>\r<br><br><img decoding=\"async\" width=408 height=138 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image066.jpg\" v:shapes=\"_x0000_i1057\"><br><\/div><input type='hidden' name='question_id[]' id='qID_306' value='25527' \/><input type='hidden' id='answerType25527' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25527[]' id='answer-id-105495' class='answer   answerof-25527 ' value='105495'   \/><label for='answer-id-105495' id='answer-label-105495' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25527[]' id='answer-id-105496' class='answer   answerof-25527 ' value='105496'   \/><label for='answer-id-105496' id='answer-label-105496' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25527[]' id='answer-id-105497' class='answer   answerof-25527 ' value='105497'   \/><label for='answer-id-105497' id='answer-label-105497' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25527[]' id='answer-id-105498' class='answer   answerof-25527 ' value='105498'   \/><label for='answer-id-105498' id='answer-label-105498' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-307' style=';'><div id='questionWrap-307'  class='   watupro-question-id-25528'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>307. <\/span>An auditor's special report on financial statements prepared in conformity with the cash basis of accounting should include a separate explanatory paragraph before the opinion paragraph that:<\/div><input type='hidden' name='question_id[]' id='qID_307' value='25528' \/><input type='hidden' id='answerType25528' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25528[]' id='answer-id-105499' class='answer   answerof-25528 ' value='105499'   \/><label for='answer-id-105499' id='answer-label-105499' class=' answer'><span>Justifies the reasons for departing from generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25528[]' id='answer-id-105500' class='answer   answerof-25528 ' value='105500'   \/><label for='answer-id-105500' id='answer-label-105500' class=' answer'><span>States whether the financial statements are fairly presented in conformity with another comprehensive basis of accounting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25528[]' id='answer-id-105501' class='answer   answerof-25528 ' value='105501'   \/><label for='answer-id-105501' id='answer-label-105501' class=' answer'><span>Refers to the note to the financial statements that describes the basis of accounting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25528[]' id='answer-id-105502' class='answer   answerof-25528 ' value='105502'   \/><label for='answer-id-105502' id='answer-label-105502' class=' answer'><span>Explains how the results of operations differ from financial statements prepared in conformity with generally accepted accounting principles.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-308' style=';'><div id='questionWrap-308'  class='   watupro-question-id-25529'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>308. <\/span>The standard report issued by an accountant after reviewing the financial statements of a nonissuer states that:<\/div><input type='hidden' name='question_id[]' id='qID_308' value='25529' \/><input type='hidden' id='answerType25529' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25529[]' id='answer-id-105503' class='answer   answerof-25529 ' value='105503'   \/><label for='answer-id-105503' id='answer-label-105503' class=' answer'><span>A review includes assessing the accounting principles used and significant estimates made by management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25529[]' id='answer-id-105504' class='answer   answerof-25529 ' value='105504'   \/><label for='answer-id-105504' id='answer-label-105504' class=' answer'><span>A review includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25529[]' id='answer-id-105505' class='answer   answerof-25529 ' value='105505'   \/><label for='answer-id-105505' id='answer-label-105505' class=' answer'><span>The accountant is not aware of any material modifications that should be made to the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25529[]' id='answer-id-105506' class='answer   answerof-25529 ' value='105506'   \/><label for='answer-id-105506' id='answer-label-105506' class=' answer'><span>The accountant does not express an opinion or any other form of assurance on the financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-309' style=';'><div id='questionWrap-309'  class='   watupro-question-id-25530'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>309. <\/span>Which of the following procedures is not usually performed by the accountant during a review engagement of a nonissuer?<\/div><input type='hidden' name='question_id[]' id='qID_309' value='25530' \/><input type='hidden' id='answerType25530' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25530[]' id='answer-id-105507' class='answer   answerof-25530 ' value='105507'   \/><label for='answer-id-105507' id='answer-label-105507' class=' answer'><span>Inquiring about actions taken at meetings of the board of directors that may affect the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25530[]' id='answer-id-105508' class='answer   answerof-25530 ' value='105508'   \/><label for='answer-id-105508' id='answer-label-105508' class=' answer'><span>Issuing a report stating that the review was performed in accordance with standards established by the AICPA.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25530[]' id='answer-id-105509' class='answer   answerof-25530 ' value='105509'   \/><label for='answer-id-105509' id='answer-label-105509' class=' answer'><span>Reading the financial statements to consider whether they conform with generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25530[]' id='answer-id-105510' class='answer   answerof-25530 ' value='105510'   \/><label for='answer-id-105510' id='answer-label-105510' class=' answer'><span>Communicating any material weaknesses discovered during the consideration of internal control.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-310' style=';'><div id='questionWrap-310'  class='   watupro-question-id-25531'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>310. <\/span>When reporting on financial statements prepared on the same basis of accounting used for income tax purposes, the auditor should include in the report a paragraph that:<\/div><input type='hidden' name='question_id[]' id='qID_310' value='25531' \/><input type='hidden' id='answerType25531' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25531[]' id='answer-id-105511' class='answer   answerof-25531 ' value='105511'   \/><label for='answer-id-105511' id='answer-label-105511' class=' answer'><span>States that the income tax basis of accounting is a comprehensive basis of accounting other than generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25531[]' id='answer-id-105512' class='answer   answerof-25531 ' value='105512'   \/><label for='answer-id-105512' id='answer-label-105512' class=' answer'><span>Justifies the use of the income tax basis of accounting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25531[]' id='answer-id-105513' class='answer   answerof-25531 ' value='105513'   \/><label for='answer-id-105513' id='answer-label-105513' class=' answer'><span>Emphasizes that the financial statements are not intended to have been audited in accordance with generally accepted auditing standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25531[]' id='answer-id-105514' class='answer   answerof-25531 ' value='105514'   \/><label for='answer-id-105514' id='answer-label-105514' class=' answer'><span>Refers to the authoritative pronouncements that explain the income tax basis of accounting being used.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-311' style=';'><div id='questionWrap-311'  class='   watupro-question-id-25532'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>311. <\/span>Which of the following statements should not be included in an accountant's standard report based on the compilation of an entity's financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_311' value='25532' \/><input type='hidden' id='answerType25532' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25532[]' id='answer-id-105515' class='answer   answerof-25532 ' value='105515'   \/><label for='answer-id-105515' id='answer-label-105515' class=' answer'><span>A statement that the compilation was performed in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of CPAs.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25532[]' id='answer-id-105516' class='answer   answerof-25532 ' value='105516'   \/><label for='answer-id-105516' id='answer-label-105516' class=' answer'><span>A statement that the accountant has not audited or reviewed the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25532[]' id='answer-id-105517' class='answer   answerof-25532 ' value='105517'   \/><label for='answer-id-105517' id='answer-label-105517' class=' answer'><span>A statement that the accountant does not express an opinion but expresses only limited assurance on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25532[]' id='answer-id-105518' class='answer   answerof-25532 ' value='105518'   \/><label for='answer-id-105518' id='answer-label-105518' class=' answer'><span>A statement that a compilation is limited to presenting, in the form of financial statements, information that is the representation of management.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-312' style=';'><div id='questionWrap-312'  class='   watupro-question-id-25533'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>312. <\/span>The objective of a review of interim financial information of a public entity is to provide the accountant with a basis for:<\/div><input type='hidden' name='question_id[]' id='qID_312' value='25533' \/><input type='hidden' id='answerType25533' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25533[]' id='answer-id-105519' class='answer   answerof-25533 ' value='105519'   \/><label for='answer-id-105519' id='answer-label-105519' class=' answer'><span>Determining whether the prospective financial information is based on reasonable assumptions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25533[]' id='answer-id-105520' class='answer   answerof-25533 ' value='105520'   \/><label for='answer-id-105520' id='answer-label-105520' class=' answer'><span>Expressing a limited opinion that the financial information is presented in conformity with generally accepted accounting principles.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25533[]' id='answer-id-105521' class='answer   answerof-25533 ' value='105521'   \/><label for='answer-id-105521' id='answer-label-105521' class=' answer'><span>Deciding whether to perform substantive audit procedures prior to the balance sheet date.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25533[]' id='answer-id-105522' class='answer   answerof-25533 ' value='105522'   \/><label for='answer-id-105522' id='answer-label-105522' class=' answer'><span>Reporting whether material modifications should be made for such information to conform with generally accepted accounting principles.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-313' style=';'><div id='questionWrap-313'  class='   watupro-question-id-25534'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>313. <\/span>How does an accountant make the following representations when issuing the standard report for the compilation of a nonissuer's financial statements? <br \/>\r<br><br><img decoding=\"async\" width=474 height=117 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image068.jpg\" v:shapes=\"_x0000_i1058\"><br><\/div><input type='hidden' name='question_id[]' id='qID_313' value='25534' \/><input type='hidden' id='answerType25534' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25534[]' id='answer-id-105523' class='answer   answerof-25534 ' value='105523'   \/><label for='answer-id-105523' id='answer-label-105523' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25534[]' id='answer-id-105524' class='answer   answerof-25534 ' value='105524'   \/><label for='answer-id-105524' id='answer-label-105524' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25534[]' id='answer-id-105525' class='answer   answerof-25534 ' value='105525'   \/><label for='answer-id-105525' id='answer-label-105525' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25534[]' id='answer-id-105526' class='answer   answerof-25534 ' value='105526'   \/><label for='answer-id-105526' id='answer-label-105526' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-314' style=';'><div id='questionWrap-314'  class='   watupro-question-id-25535'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>314. <\/span>Financial statements of a nonissuer that have been reviewed by an accountant should be accompanied by a report stating that:<\/div><input type='hidden' name='question_id[]' id='qID_314' value='25535' \/><input type='hidden' id='answerType25535' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25535[]' id='answer-id-105527' class='answer   answerof-25535 ' value='105527'   \/><label for='answer-id-105527' id='answer-label-105527' class=' answer'><span>The scope of the inquiry and analytical procedures performed by the accountant has not been restricted.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25535[]' id='answer-id-105528' class='answer   answerof-25535 ' value='105528'   \/><label for='answer-id-105528' id='answer-label-105528' class=' answer'><span>All information included in the financial statements is the representation of the management of the entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25535[]' id='answer-id-105529' class='answer   answerof-25535 ' value='105529'   \/><label for='answer-id-105529' id='answer-label-105529' class=' answer'><span>A review includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25535[]' id='answer-id-105530' class='answer   answerof-25535 ' value='105530'   \/><label for='answer-id-105530' id='answer-label-105530' class=' answer'><span>A review is greater in scope than a compilation, the objective of which is to present financial statements that are free of material misstatements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-315' style=';'><div id='questionWrap-315'  class='   watupro-question-id-25536'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>315. <\/span>Performing inquiry and analytical procedures is the primary basis for an accountant to issue a:<\/div><input type='hidden' name='question_id[]' id='qID_315' value='25536' \/><input type='hidden' id='answerType25536' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25536[]' id='answer-id-105531' class='answer   answerof-25536 ' value='105531'   \/><label for='answer-id-105531' id='answer-label-105531' class=' answer'><span>Report on compliance with requirements governing major federal assistance programs in accordance with the Single Audit Act.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25536[]' id='answer-id-105532' class='answer   answerof-25536 ' value='105532'   \/><label for='answer-id-105532' id='answer-label-105532' class=' answer'><span>Review report on prospective financial statements that present an entity's expected financial position, given one or more hypothetical assumptions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25536[]' id='answer-id-105533' class='answer   answerof-25536 ' value='105533'   \/><label for='answer-id-105533' id='answer-label-105533' class=' answer'><span>Management advisory report prepared at the request of a client's audit committee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25536[]' id='answer-id-105534' class='answer   answerof-25536 ' value='105534'   \/><label for='answer-id-105534' id='answer-label-105534' class=' answer'><span>Review report on comparative financial statements for a nonissuer in its second year of operations.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-316' style=';'><div id='questionWrap-316'  class='   watupro-question-id-25537'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>316. <\/span>An auditor's report on financial statements prepared in accordance with another comprehensive basis of accounting should include all of the following, except:<\/div><input type='hidden' name='question_id[]' id='qID_316' value='25537' \/><input type='hidden' id='answerType25537' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25537[]' id='answer-id-105535' class='answer   answerof-25537 ' value='105535'   \/><label for='answer-id-105535' id='answer-label-105535' class=' answer'><span>An opinion as to whether the basis of accounting used is appropriate under the circumstances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25537[]' id='answer-id-105536' class='answer   answerof-25537 ' value='105536'   \/><label for='answer-id-105536' id='answer-label-105536' class=' answer'><span>An opinion as to whether the financial statements are presented fairly in conformity with the other comprehensive basis of accounting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25537[]' id='answer-id-105537' class='answer   answerof-25537 ' value='105537'   \/><label for='answer-id-105537' id='answer-label-105537' class=' answer'><span>Reference to the note to the financial statements that describes the basis of presentation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25537[]' id='answer-id-105538' class='answer   answerof-25537 ' value='105538'   \/><label for='answer-id-105538' id='answer-label-105538' class=' answer'><span>A statement that the basis of presentation is a comprehensive basis of accounting other than generally accepted accounting principles.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-317' style=';'><div id='questionWrap-317'  class='   watupro-question-id-25538'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>317. <\/span>When an independent accountant's report based on a review of interim financial information is presented in a registration statement, a prospectus should include a statement about the accountant's involvement. <br \/>\r<br>This statement should clarify that the:<\/div><input type='hidden' name='question_id[]' id='qID_317' value='25538' \/><input type='hidden' id='answerType25538' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25538[]' id='answer-id-105539' class='answer   answerof-25538 ' value='105539'   \/><label for='answer-id-105539' id='answer-label-105539' class=' answer'><span>Accountant is not an &quot;expert&quot; within the meaning of the Securities Act of 1933.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25538[]' id='answer-id-105540' class='answer   answerof-25538 ' value='105540'   \/><label for='answer-id-105540' id='answer-label-105540' class=' answer'><span>Accountant's review report is not a &quot;part&quot; of the registration statement within the meaning of the Securities Act of 1933.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25538[]' id='answer-id-105541' class='answer   answerof-25538 ' value='105541'   \/><label for='answer-id-105541' id='answer-label-105541' class=' answer'><span>Accountant performed only limited auditing procedures on the interim financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25538[]' id='answer-id-105542' class='answer   answerof-25538 ' value='105542'   \/><label for='answer-id-105542' id='answer-label-105542' class=' answer'><span>Accountant's review was performed in accordance with standards established by the American Institute of CPAs.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-318' style=';'><div id='questionWrap-318'  class='   watupro-question-id-25539'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>318. <\/span>Before issuing a report on the compilation of financial statements of a nonissuer, the accountant should:<\/div><input type='hidden' name='question_id[]' id='qID_318' value='25539' \/><input type='hidden' id='answerType25539' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25539[]' id='answer-id-105543' class='answer   answerof-25539 ' value='105543'   \/><label for='answer-id-105543' id='answer-label-105543' class=' answer'><span>Apply analytical procedures to selected financial data to discover any material misstatements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25539[]' id='answer-id-105544' class='answer   answerof-25539 ' value='105544'   \/><label for='answer-id-105544' id='answer-label-105544' class=' answer'><span>Corroborate at least a sample of the assertions management has embodied in the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25539[]' id='answer-id-105545' class='answer   answerof-25539 ' value='105545'   \/><label for='answer-id-105545' id='answer-label-105545' class=' answer'><span>Inquire of the client's personnel whether the financial statements omit substantially all disclosures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25539[]' id='answer-id-105546' class='answer   answerof-25539 ' value='105546'   \/><label for='answer-id-105546' id='answer-label-105546' class=' answer'><span>Read the financial statements to consider whether the financial statements are free from obvious material errors.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-319' style=';'><div id='questionWrap-319'  class='   watupro-question-id-25540'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>319. <\/span>During a review of the financial statements of a nonissuer, an accountant becomes aware of a lack of adequate disclosure that is material to the financial statements. <br \/>\r<br>If management refuses to correct the financial statement presentations, the accountant should:<\/div><input type='hidden' name='question_id[]' id='qID_319' value='25540' \/><input type='hidden' id='answerType25540' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25540[]' id='answer-id-105547' class='answer   answerof-25540 ' value='105547'   \/><label for='answer-id-105547' id='answer-label-105547' class=' answer'><span>Issue an adverse opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25540[]' id='answer-id-105548' class='answer   answerof-25540 ' value='105548'   \/><label for='answer-id-105548' id='answer-label-105548' class=' answer'><span>Issue an &quot;except for&quot; qualified opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25540[]' id='answer-id-105549' class='answer   answerof-25540 ' value='105549'   \/><label for='answer-id-105549' id='answer-label-105549' class=' answer'><span>Disclose this departure from generally accepted accounting principles in a separate paragraph of the report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25540[]' id='answer-id-105550' class='answer   answerof-25540 ' value='105550'   \/><label for='answer-id-105550' id='answer-label-105550' class=' answer'><span>Express only limited assurance on the financial statement presentations.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-320' style=';'><div id='questionWrap-320'  class='   watupro-question-id-25541'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>320. <\/span>Unaudited financial statements for the prior year presented in comparative form with audited financial statements for the current year should be clearly marked to indicate their status and <br \/>\r<br>I. The report on the prior period should be reissued to accompany the current period report. <br \/>\r<br>II. The report on the current period should include as a separate paragraph a description of the responsibility assumed for the prior period's financial statements.<\/div><input type='hidden' name='question_id[]' id='qID_320' value='25541' \/><input type='hidden' id='answerType25541' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25541[]' id='answer-id-105551' class='answer   answerof-25541 ' value='105551'   \/><label for='answer-id-105551' id='answer-label-105551' class=' answer'><span>I only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25541[]' id='answer-id-105552' class='answer   answerof-25541 ' value='105552'   \/><label for='answer-id-105552' id='answer-label-105552' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25541[]' id='answer-id-105553' class='answer   answerof-25541 ' value='105553'   \/><label for='answer-id-105553' id='answer-label-105553' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25541[]' id='answer-id-105554' class='answer   answerof-25541 ' value='105554'   \/><label for='answer-id-105554' id='answer-label-105554' class=' answer'><span>Either I or I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-321' style=';'><div id='questionWrap-321'  class='   watupro-question-id-25542'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>321. <\/span>Comfort letters ordinarily are addressed to:<\/div><input type='hidden' name='question_id[]' id='qID_321' value='25542' \/><input type='hidden' id='answerType25542' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25542[]' id='answer-id-105555' class='answer   answerof-25542 ' value='105555'   \/><label for='answer-id-105555' id='answer-label-105555' class=' answer'><span>The Securities and Exchange Commission.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25542[]' id='answer-id-105556' class='answer   answerof-25542 ' value='105556'   \/><label for='answer-id-105556' id='answer-label-105556' class=' answer'><span>Underwriters of securities.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25542[]' id='answer-id-105557' class='answer   answerof-25542 ' value='105557'   \/><label for='answer-id-105557' id='answer-label-105557' class=' answer'><span>Creditor financial institutions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25542[]' id='answer-id-105558' class='answer   answerof-25542 ' value='105558'   \/><label for='answer-id-105558' id='answer-label-105558' class=' answer'><span>The client's audit committee.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-322' style=';'><div id='questionWrap-322'  class='   watupro-question-id-25543'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>322. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>There should be no reference to the prior year's audited financial statements in the first (introductory) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_322' value='25543' \/><input type='hidden' id='answerType25543' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25543[]' id='answer-id-105559' class='answer   answerof-25543 ' value='105559'   \/><label for='answer-id-105559' id='answer-label-105559' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25543[]' id='answer-id-105560' class='answer   answerof-25543 ' value='105560'   \/><label for='answer-id-105560' id='answer-label-105560' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-323' style=';'><div id='questionWrap-323'  class='   watupro-question-id-25544'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>323. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>All the current-year basic financial statements are not properly identified in the first (introductory) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_323' value='25544' \/><input type='hidden' id='answerType25544' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25544[]' id='answer-id-105561' class='answer   answerof-25544 ' value='105561'   \/><label for='answer-id-105561' id='answer-label-105561' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25544[]' id='answer-id-105562' class='answer   answerof-25544 ' value='105562'   \/><label for='answer-id-105562' id='answer-label-105562' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-324' style=';'><div id='questionWrap-324'  class='   watupro-question-id-25545'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>324. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>There should be no reference to the American Institute of Certified Public Accountants in the first (introductory) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_324' value='25545' \/><input type='hidden' id='answerType25545' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25545[]' id='answer-id-105563' class='answer   answerof-25545 ' value='105563'   \/><label for='answer-id-105563' id='answer-label-105563' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25545[]' id='answer-id-105564' class='answer   answerof-25545 ' value='105564'   \/><label for='answer-id-105564' id='answer-label-105564' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-325' style=';'><div id='questionWrap-325'  class='   watupro-question-id-25546'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>325. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review <br \/>\r<br>Notes The accountant's review and audit responsibilities should follow management's responsibilities in the first (introductory) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_325' value='25546' \/><input type='hidden' id='answerType25546' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25546[]' id='answer-id-105565' class='answer   answerof-25546 ' value='105565'   \/><label for='answer-id-105565' id='answer-label-105565' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25546[]' id='answer-id-105566' class='answer   answerof-25546 ' value='105566'   \/><label for='answer-id-105566' id='answer-label-105566' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-326' style=';'><div id='questionWrap-326'  class='   watupro-question-id-25547'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>326. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>There should be no comparison of the scope of a review to an audit in the second (scope) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_326' value='25547' \/><input type='hidden' id='answerType25547' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25547[]' id='answer-id-105567' class='answer   answerof-25547 ' value='105567'   \/><label for='answer-id-105567' id='answer-label-105567' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25547[]' id='answer-id-105568' class='answer   answerof-25547 ' value='105568'   \/><label for='answer-id-105568' id='answer-label-105568' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-327' style=';'><div id='questionWrap-327'  class='   watupro-question-id-25548'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>327. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>Negative assurance should be expressed on the current year's reviewed financial statements in the second (scope) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_327' value='25548' \/><input type='hidden' id='answerType25548' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25548[]' id='answer-id-105569' class='answer   answerof-25548 ' value='105569'   \/><label for='answer-id-105569' id='answer-label-105569' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25548[]' id='answer-id-105570' class='answer   answerof-25548 ' value='105570'   \/><label for='answer-id-105570' id='answer-label-105570' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-328' style=';'><div id='questionWrap-328'  class='   watupro-question-id-25549'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>328. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>There should be a statement that no opinion is expressed on the current year's financial statements in the second (scope) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_328' value='25549' \/><input type='hidden' id='answerType25549' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25549[]' id='answer-id-105571' class='answer   answerof-25549 ' value='105571'   \/><label for='answer-id-105571' id='answer-label-105571' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25549[]' id='answer-id-105572' class='answer   answerof-25549 ' value='105572'   \/><label for='answer-id-105572' id='answer-label-105572' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-329' style=';'><div id='questionWrap-329'  class='   watupro-question-id-25550'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>329. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>There should be a reference to &quot;conformity with generally accepted accounting principles&quot; in the third paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_329' value='25550' \/><input type='hidden' id='answerType25550' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25550[]' id='answer-id-105573' class='answer   answerof-25550 ' value='105573'   \/><label for='answer-id-105573' id='answer-label-105573' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25550[]' id='answer-id-105574' class='answer   answerof-25550 ' value='105574'   \/><label for='answer-id-105574' id='answer-label-105574' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-330' style=';'><div id='questionWrap-330'  class='   watupro-question-id-25551'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>330. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>There should be no restriction on the use of the accountant's review report in the third paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_330' value='25551' \/><input type='hidden' id='answerType25551' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25551[]' id='answer-id-105575' class='answer   answerof-25551 ' value='105575'   \/><label for='answer-id-105575' id='answer-label-105575' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25551[]' id='answer-id-105576' class='answer   answerof-25551 ' value='105576'   \/><label for='answer-id-105576' id='answer-label-105576' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-331' style=';'><div id='questionWrap-331'  class='   watupro-question-id-25552'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>331. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant's Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor's Review Notes <br \/>\r<br>There should be no reference to &quot;material modifications&quot; in the third paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_331' value='25552' \/><input type='hidden' id='answerType25552' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25552[]' id='answer-id-105577' class='answer   answerof-25552 ' value='105577'   \/><label for='answer-id-105577' id='answer-label-105577' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25552[]' id='answer-id-105578' class='answer   answerof-25552 ' value='105578'   \/><label for='answer-id-105578' id='answer-label-105578' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-332' style=';'><div id='questionWrap-332'  class='   watupro-question-id-25553'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>332. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant\u2019s Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor\u2019s Review Notes <br \/>\r<br>There should be an indication of the type of opinion expressed on the prior year's audited financial statements in the fourth (separate) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_332' value='25553' \/><input type='hidden' id='answerType25553' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25553[]' id='answer-id-105579' class='answer   answerof-25553 ' value='105579'   \/><label for='answer-id-105579' id='answer-label-105579' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25553[]' id='answer-id-105580' class='answer   answerof-25553 ' value='105580'   \/><label for='answer-id-105580' id='answer-label-105580' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-333' style=';'><div id='questionWrap-333'  class='   watupro-question-id-25554'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>333. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant\u2019s Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor\u2019s Review Notes <br \/>\r<br>There should be an indication that no auditing procedures were performed after the date of the report on the prior year's financial statements in the fourth (separate) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_333' value='25554' \/><input type='hidden' id='answerType25554' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25554[]' id='answer-id-105581' class='answer   answerof-25554 ' value='105581'   \/><label for='answer-id-105581' id='answer-label-105581' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25554[]' id='answer-id-105582' class='answer   answerof-25554 ' value='105582'   \/><label for='answer-id-105582' id='answer-label-105582' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-334' style=';'><div id='questionWrap-334'  class='   watupro-question-id-25555'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>334. <\/span>This question consists of an item pertaining to possible deficiencies in an accountant's review report. Jordan &amp; Stone, CPAs, audited the financial statements of Tech Co., a nonissuer, for the year ended December 31, 20X1, and expressed an unqualified opinion. For the year ended December 31, 20X2, Tech issued comparative financial statements. Jordan &amp; Stone reviewed Tech's 20X2 financial statements and Kent, an assistant on the engagement, drafted the accountants' review report below. Land, the engagement supervisor, decided not to reissue the prior year's auditors' report, but instructed Kent to include a separate paragraph in the current year's review report describing the responsibility assumed for the prior year's audited financial statements. This is an appropriate reporting procedure. Land reviewed Kent's draft and indicated in the Supervisor's Review Notes below that there were several deficiencies in Kent's draft. <br \/>\r<br>Accountant\u2019s Review Report <br \/>\r<br>We have reviewed and audited the accompanying balance sheets of Tech Co. as of December 31, 20X2 and 20X1, and the related statements of income, retained earnings, and cash flows for the years then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants and generally accepted auditing standards. All information included in these financial statements is the representation of the management of Tech Co. A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements. Because of the inherent limitations of a review engagement, this report is intended for the information of management and should not be used for any other purpose. The financial statements for the year ended December 31, 20X1, were audited by us and our report was dated March 2, 20X2. We have no responsibility for updating that report for events and circumstances occurring after that date. <br \/>\r<br>Jordan and Stone, CPAs <br \/>\r<br>March 1, 20X3 <br \/>\r<br>Supervisor\u2019s Review Notes <br \/>\r<br>There should be no reference to &quot;updating the prior year's auditor's report for events and circumstances occurring after that date&quot; in the fourth (separate) paragraph.<\/div><input type='hidden' name='question_id[]' id='qID_334' value='25555' \/><input type='hidden' id='answerType25555' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25555[]' id='answer-id-105583' class='answer   answerof-25555 ' value='105583'   \/><label for='answer-id-105583' id='answer-label-105583' class=' answer'><span>Correct<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25555[]' id='answer-id-105584' class='answer   answerof-25555 ' value='105584'   \/><label for='answer-id-105584' id='answer-label-105584' class=' answer'><span>Incorrect<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-335' style=';'><div id='questionWrap-335'  class='   watupro-question-id-25556'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>335. <\/span>Which of the following is true about the term &quot;likely misstatement?&quot;<\/div><input type='hidden' name='question_id[]' id='qID_335' value='25556' \/><input type='hidden' id='answerType25556' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25556[]' id='answer-id-105585' class='answer   answerof-25556 ' value='105585'   \/><label for='answer-id-105585' id='answer-label-105585' class=' answer'><span>It refers to misstatements that have not been specifically identified, but which are likely to exist based on the auditor's judgment.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25556[]' id='answer-id-105586' class='answer   answerof-25556 ' value='105586'   \/><label for='answer-id-105586' id='answer-label-105586' class=' answer'><span>It refers to the cumulative effect of misstatements from prior years on the current year's financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25556[]' id='answer-id-105587' class='answer   answerof-25556 ' value='105587'   \/><label for='answer-id-105587' id='answer-label-105587' class=' answer'><span>It refers to misstatements that have been specifically identified by the auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25556[]' id='answer-id-105588' class='answer   answerof-25556 ' value='105588'   \/><label for='answer-id-105588' id='answer-label-105588' class=' answer'><span>It includes both identified misstatements and an estimate of unidentified misstatements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-336' style=';'><div id='questionWrap-336'  class='   watupro-question-id-25557'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>336. <\/span>A successor auditor ordinarily should request to review the predecessor's audit documentation relating to: <br \/>\r<br><br><img decoding=\"async\" width=290 height=95 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image070.jpg\" v:shapes=\"_x0000_i1059\"><br><\/div><input type='hidden' name='question_id[]' id='qID_336' value='25557' \/><input type='hidden' id='answerType25557' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25557[]' id='answer-id-105589' class='answer   answerof-25557 ' value='105589'   \/><label for='answer-id-105589' id='answer-label-105589' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25557[]' id='answer-id-105590' class='answer   answerof-25557 ' value='105590'   \/><label for='answer-id-105590' id='answer-label-105590' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25557[]' id='answer-id-105591' class='answer   answerof-25557 ' value='105591'   \/><label for='answer-id-105591' id='answer-label-105591' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25557[]' id='answer-id-105592' class='answer   answerof-25557 ' value='105592'   \/><label for='answer-id-105592' id='answer-label-105592' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-337' style=';'><div id='questionWrap-337'  class='   watupro-question-id-25558'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>337. <\/span>An auditor's engagement letter most likely would include:<\/div><input type='hidden' name='question_id[]' id='qID_337' value='25558' \/><input type='hidden' id='answerType25558' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25558[]' id='answer-id-105593' class='answer   answerof-25558 ' value='105593'   \/><label for='answer-id-105593' id='answer-label-105593' class=' answer'><span>Management's acknowledgment of its responsibility for maintaining effective internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25558[]' id='answer-id-105594' class='answer   answerof-25558 ' value='105594'   \/><label for='answer-id-105594' id='answer-label-105594' class=' answer'><span>The auditor's preliminary assessment of the risk factors relating to misstatements arising from fraudulent financial reporting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25558[]' id='answer-id-105595' class='answer   answerof-25558 ' value='105595'   \/><label for='answer-id-105595' id='answer-label-105595' class=' answer'><span>A reminder that management is responsible for illegal acts committed by employees.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25558[]' id='answer-id-105596' class='answer   answerof-25558 ' value='105596'   \/><label for='answer-id-105596' id='answer-label-105596' class=' answer'><span>A request for permission to contact the client's lawyer for assistance in identifying litigation, claims, and assessments.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-338' style=';'><div id='questionWrap-338'  class='   watupro-question-id-25559'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>338. <\/span>Which of the following auditor concerns most likely could be so serious that the auditor concludes that a financial statement audit cannot be performed?<\/div><input type='hidden' name='question_id[]' id='qID_338' value='25559' \/><input type='hidden' id='answerType25559' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25559[]' id='answer-id-105597' class='answer   answerof-25559 ' value='105597'   \/><label for='answer-id-105597' id='answer-label-105597' class=' answer'><span>Management fails to modify prescribed internal controls for changes in information technology.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25559[]' id='answer-id-105598' class='answer   answerof-25559 ' value='105598'   \/><label for='answer-id-105598' id='answer-label-105598' class=' answer'><span>Internal control activities requiring segregation of duties are rarely monitored by management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25559[]' id='answer-id-105599' class='answer   answerof-25559 ' value='105599'   \/><label for='answer-id-105599' id='answer-label-105599' class=' answer'><span>Management is dominated by one person who is also the majority stockholder.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25559[]' id='answer-id-105600' class='answer   answerof-25559 ' value='105600'   \/><label for='answer-id-105600' id='answer-label-105600' class=' answer'><span>There is a substantial risk of intentional misapplication of accounting principles.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-339' style=';'><div id='questionWrap-339'  class='   watupro-question-id-25560'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>339. <\/span>Which of the following factors would a CPA ordinarily consider in the planning stage of an audit engagement? <br \/>\r<br>I. Financial statement accounts likely to contain a misstatement. <br \/>\r<br>II. Conditions that require extension of audit tests.<\/div><input type='hidden' name='question_id[]' id='qID_339' value='25560' \/><input type='hidden' id='answerType25560' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25560[]' id='answer-id-105601' class='answer   answerof-25560 ' value='105601'   \/><label for='answer-id-105601' id='answer-label-105601' class=' answer'><span>I only<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25560[]' id='answer-id-105602' class='answer   answerof-25560 ' value='105602'   \/><label for='answer-id-105602' id='answer-label-105602' class=' answer'><span>II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25560[]' id='answer-id-105603' class='answer   answerof-25560 ' value='105603'   \/><label for='answer-id-105603' id='answer-label-105603' class=' answer'><span>Both I and I<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25560[]' id='answer-id-105604' class='answer   answerof-25560 ' value='105604'   \/><label for='answer-id-105604' id='answer-label-105604' class=' answer'><span>Neither I nor I<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-340' style=';'><div id='questionWrap-340'  class='   watupro-question-id-25561'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>340. <\/span>In assessing the objectivity of internal auditors, the independent CPA who is auditing the entity's financial statements most likely would consider the:<\/div><input type='hidden' name='question_id[]' id='qID_340' value='25561' \/><input type='hidden' id='answerType25561' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25561[]' id='answer-id-105605' class='answer   answerof-25561 ' value='105605'   \/><label for='answer-id-105605' id='answer-label-105605' class=' answer'><span>Internal auditing standards developed by The Institute of Internal Auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25561[]' id='answer-id-105606' class='answer   answerof-25561 ' value='105606'   \/><label for='answer-id-105606' id='answer-label-105606' class=' answer'><span>Tests of internal control activities that could detect errors and fraud.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25561[]' id='answer-id-105607' class='answer   answerof-25561 ' value='105607'   \/><label for='answer-id-105607' id='answer-label-105607' class=' answer'><span>Materiality of the accounts recently inspected by the internal auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25561[]' id='answer-id-105608' class='answer   answerof-25561 ' value='105608'   \/><label for='answer-id-105608' id='answer-label-105608' class=' answer'><span>Results of the tests of transactions recently performed by the internal auditors.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-341' style=';'><div id='questionWrap-341'  class='   watupro-question-id-25562'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>341. <\/span>Which of the following factors most likely would cause a CPA to not accept a new audit engagement?<\/div><input type='hidden' name='question_id[]' id='qID_341' value='25562' \/><input type='hidden' id='answerType25562' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25562[]' id='answer-id-105609' class='answer   answerof-25562 ' value='105609'   \/><label for='answer-id-105609' id='answer-label-105609' class=' answer'><span>The prospective client has already completed its physical inventory count.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25562[]' id='answer-id-105610' class='answer   answerof-25562 ' value='105610'   \/><label for='answer-id-105610' id='answer-label-105610' class=' answer'><span>The CPA lacks an understanding of the prospective client's operations and industry.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25562[]' id='answer-id-105611' class='answer   answerof-25562 ' value='105611'   \/><label for='answer-id-105611' id='answer-label-105611' class=' answer'><span>The CPA is unable to review the predecessor auditor's audit documentation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25562[]' id='answer-id-105612' class='answer   answerof-25562 ' value='105612'   \/><label for='answer-id-105612' id='answer-label-105612' class=' answer'><span>The prospective client is unwilling to make all financial records available to the CPA.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-342' style=';'><div id='questionWrap-342'  class='   watupro-question-id-25563'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>342. <\/span>A CPA wishes to determine how various publicly-held companies have complied with the disclosure requirements of a new financial accounting standard. <br \/>\r<br>Which of the following information sources would the CPA most likely consult for this information?<\/div><input type='hidden' name='question_id[]' id='qID_342' value='25563' \/><input type='hidden' id='answerType25563' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25563[]' id='answer-id-105613' class='answer   answerof-25563 ' value='105613'   \/><label for='answer-id-105613' id='answer-label-105613' class=' answer'><span>AICPA Codification of Statements on Auditing Standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25563[]' id='answer-id-105614' class='answer   answerof-25563 ' value='105614'   \/><label for='answer-id-105614' id='answer-label-105614' class=' answer'><span>AICPA Accounting Trends and Techniques.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25563[]' id='answer-id-105615' class='answer   answerof-25563 ' value='105615'   \/><label for='answer-id-105615' id='answer-label-105615' class=' answer'><span>SEC Quality Control Review.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25563[]' id='answer-id-105616' class='answer   answerof-25563 ' value='105616'   \/><label for='answer-id-105616' id='answer-label-105616' class=' answer'><span>SEC Statement 10-K Guide.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-343' style=';'><div id='questionWrap-343'  class='   watupro-question-id-25564'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>343. <\/span>Which of the following factors most likely would lead a CPA to conclude that a potential audit engagement should be rejected?<\/div><input type='hidden' name='question_id[]' id='qID_343' value='25564' \/><input type='hidden' id='answerType25564' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25564[]' id='answer-id-105617' class='answer   answerof-25564 ' value='105617'   \/><label for='answer-id-105617' id='answer-label-105617' class=' answer'><span>The details of most recorded transactions are not available after a specified period of time.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25564[]' id='answer-id-105618' class='answer   answerof-25564 ' value='105618'   \/><label for='answer-id-105618' id='answer-label-105618' class=' answer'><span>Internal control activities requiring the segregation of duties are subject to management override.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25564[]' id='answer-id-105619' class='answer   answerof-25564 ' value='105619'   \/><label for='answer-id-105619' id='answer-label-105619' class=' answer'><span>It is unlikely that sufficient appropriate evidence is available to support an opinion on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25564[]' id='answer-id-105620' class='answer   answerof-25564 ' value='105620'   \/><label for='answer-id-105620' id='answer-label-105620' class=' answer'><span>Management has a reputation for consulting with several accounting firms about significant accounting issues.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-344' style=';'><div id='questionWrap-344'  class='   watupro-question-id-25565'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>344. <\/span>Which of the following factors most likely would cause a CPA to decide not to accept a new audit engagement?<\/div><input type='hidden' name='question_id[]' id='qID_344' value='25565' \/><input type='hidden' id='answerType25565' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25565[]' id='answer-id-105621' class='answer   answerof-25565 ' value='105621'   \/><label for='answer-id-105621' id='answer-label-105621' class=' answer'><span>The CPA's lack of understanding of the prospective client's internal auditor's computer-assisted audit techniques.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25565[]' id='answer-id-105622' class='answer   answerof-25565 ' value='105622'   \/><label for='answer-id-105622' id='answer-label-105622' class=' answer'><span>Management's disregard of its responsibility to maintain an adequate internal control environment.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25565[]' id='answer-id-105623' class='answer   answerof-25565 ' value='105623'   \/><label for='answer-id-105623' id='answer-label-105623' class=' answer'><span>The CPA's inability to determine whether related party transactions were consummated on terms equivalent to arm's-length transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25565[]' id='answer-id-105624' class='answer   answerof-25565 ' value='105624'   \/><label for='answer-id-105624' id='answer-label-105624' class=' answer'><span>Management's refusal to permit the CPA to perform substantive tests before the year-end.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-345' style=';'><div id='questionWrap-345'  class='   watupro-question-id-25566'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>345. <\/span>Which of the following matters generally is included in an auditor's engagement letter?<\/div><input type='hidden' name='question_id[]' id='qID_345' value='25566' \/><input type='hidden' id='answerType25566' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25566[]' id='answer-id-105625' class='answer   answerof-25566 ' value='105625'   \/><label for='answer-id-105625' id='answer-label-105625' class=' answer'><span>Management's responsibility for the entity's compliance with laws and regulations.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25566[]' id='answer-id-105626' class='answer   answerof-25566 ' value='105626'   \/><label for='answer-id-105626' id='answer-label-105626' class=' answer'><span>The factors to be considered in setting preliminary judgments about materiality.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25566[]' id='answer-id-105627' class='answer   answerof-25566 ' value='105627'   \/><label for='answer-id-105627' id='answer-label-105627' class=' answer'><span>Management's vicarious liability for illegal acts committed by its employees.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25566[]' id='answer-id-105628' class='answer   answerof-25566 ' value='105628'   \/><label for='answer-id-105628' id='answer-label-105628' class=' answer'><span>The auditor's responsibility to search for significant internal control deficiencies.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-346' style=';'><div id='questionWrap-346'  class='   watupro-question-id-25567'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>346. <\/span>Before accepting an engagement to audit a new client, a CPA is required to obtain:<\/div><input type='hidden' name='question_id[]' id='qID_346' value='25567' \/><input type='hidden' id='answerType25567' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25567[]' id='answer-id-105629' class='answer   answerof-25567 ' value='105629'   \/><label for='answer-id-105629' id='answer-label-105629' class=' answer'><span>An understanding of the prospective client's industry and business.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25567[]' id='answer-id-105630' class='answer   answerof-25567 ' value='105630'   \/><label for='answer-id-105630' id='answer-label-105630' class=' answer'><span>The prospective client's signature to the representation letter.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25567[]' id='answer-id-105631' class='answer   answerof-25567 ' value='105631'   \/><label for='answer-id-105631' id='answer-label-105631' class=' answer'><span>A preliminary understanding of the prospective client's control environment.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25567[]' id='answer-id-105632' class='answer   answerof-25567 ' value='105632'   \/><label for='answer-id-105632' id='answer-label-105632' class=' answer'><span>The prospective client's consent to make inquiries of the predecessor auditor, if any.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-347' style=';'><div id='questionWrap-347'  class='   watupro-question-id-25568'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>347. <\/span>In assessing the objectivity of internal auditors, an independent auditor should:<\/div><input type='hidden' name='question_id[]' id='qID_347' value='25568' \/><input type='hidden' id='answerType25568' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25568[]' id='answer-id-105633' class='answer   answerof-25568 ' value='105633'   \/><label for='answer-id-105633' id='answer-label-105633' class=' answer'><span>Evaluate the quality control program in effect for the internal auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25568[]' id='answer-id-105634' class='answer   answerof-25568 ' value='105634'   \/><label for='answer-id-105634' id='answer-label-105634' class=' answer'><span>Examine documentary evidence of the work performed by the internal auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25568[]' id='answer-id-105635' class='answer   answerof-25568 ' value='105635'   \/><label for='answer-id-105635' id='answer-label-105635' class=' answer'><span>Test a sample of the transactions and balances that the internal auditors examined.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25568[]' id='answer-id-105636' class='answer   answerof-25568 ' value='105636'   \/><label for='answer-id-105636' id='answer-label-105636' class=' answer'><span>Determine the organizational level to which the internal auditors report.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-348' style=';'><div id='questionWrap-348'  class='   watupro-question-id-25569'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>348. <\/span>Which of the following auditor concerns most likely could be so serious that the auditor concludes that a financial statement audit cannot be conducted?<\/div><input type='hidden' name='question_id[]' id='qID_348' value='25569' \/><input type='hidden' id='answerType25569' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25569[]' id='answer-id-105637' class='answer   answerof-25569 ' value='105637'   \/><label for='answer-id-105637' id='answer-label-105637' class=' answer'><span>The entity has no formal written code of conduct.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25569[]' id='answer-id-105638' class='answer   answerof-25569 ' value='105638'   \/><label for='answer-id-105638' id='answer-label-105638' class=' answer'><span>The integrity of the entity's management is suspect.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25569[]' id='answer-id-105639' class='answer   answerof-25569 ' value='105639'   \/><label for='answer-id-105639' id='answer-label-105639' class=' answer'><span>Procedures requiring segregation of duties are subject to management override.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25569[]' id='answer-id-105640' class='answer   answerof-25569 ' value='105640'   \/><label for='answer-id-105640' id='answer-label-105640' class=' answer'><span>Management fails to modify prescribed controls for changes in conditions.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-349' style=';'><div id='questionWrap-349'  class='   watupro-question-id-25570'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>349. <\/span>The work of internal auditors may affect the independent auditor's: <br \/>\r<br>I. Procedures performed in obtaining an understanding of internal control. <br \/>\r<br>II. Procedures performed in assessing the risk of material misstatement. <br \/>\r<br>III. Substantive procedures performed in gathering direct evidence.<\/div><input type='hidden' name='question_id[]' id='qID_349' value='25570' \/><input type='hidden' id='answerType25570' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25570[]' id='answer-id-105641' class='answer   answerof-25570 ' value='105641'   \/><label for='answer-id-105641' id='answer-label-105641' class=' answer'><span>I and II only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25570[]' id='answer-id-105642' class='answer   answerof-25570 ' value='105642'   \/><label for='answer-id-105642' id='answer-label-105642' class=' answer'><span>I and III only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25570[]' id='answer-id-105643' class='answer   answerof-25570 ' value='105643'   \/><label for='answer-id-105643' id='answer-label-105643' class=' answer'><span>II and Ill only.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25570[]' id='answer-id-105644' class='answer   answerof-25570 ' value='105644'   \/><label for='answer-id-105644' id='answer-label-105644' class=' answer'><span>I, II, and II<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-350' style=';'><div id='questionWrap-350'  class='   watupro-question-id-25571'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>350. <\/span>Which of the following statements is correct concerning an auditor's use of the work of a specialist?<\/div><input type='hidden' name='question_id[]' id='qID_350' value='25571' \/><input type='hidden' id='answerType25571' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25571[]' id='answer-id-105645' class='answer   answerof-25571 ' value='105645'   \/><label for='answer-id-105645' id='answer-label-105645' class=' answer'><span>The auditor need not obtain an understanding of the methods and assumptions used by the specialist.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25571[]' id='answer-id-105646' class='answer   answerof-25571 ' value='105646'   \/><label for='answer-id-105646' id='answer-label-105646' class=' answer'><span>The auditor may not use the work of a specialist in matters material to the fair presentation of the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25571[]' id='answer-id-105647' class='answer   answerof-25571 ' value='105647'   \/><label for='answer-id-105647' id='answer-label-105647' class=' answer'><span>The reasonableness of the specialist's assumptions and their applications are strictly the auditor's responsibility.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25571[]' id='answer-id-105648' class='answer   answerof-25571 ' value='105648'   \/><label for='answer-id-105648' id='answer-label-105648' class=' answer'><span>The work of a specialist who has a contractual relationship with the client may be acceptable under certain circumstances.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-351' style=';'><div id='questionWrap-351'  class='   watupro-question-id-25572'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>351. <\/span>The element of the audit planning process most likely to be agreed upon with the client before implementation of the audit strategy is the determination of the:<\/div><input type='hidden' name='question_id[]' id='qID_351' value='25572' \/><input type='hidden' id='answerType25572' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25572[]' id='answer-id-105649' class='answer   answerof-25572 ' value='105649'   \/><label for='answer-id-105649' id='answer-label-105649' class=' answer'><span>Evidence to be gathered to provide a sufficient basis for the auditor's opinion.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25572[]' id='answer-id-105650' class='answer   answerof-25572 ' value='105650'   \/><label for='answer-id-105650' id='answer-label-105650' class=' answer'><span>Procedures to be undertaken to discover litigation, claims, and assessments.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25572[]' id='answer-id-105651' class='answer   answerof-25572 ' value='105651'   \/><label for='answer-id-105651' id='answer-label-105651' class=' answer'><span>Pending legal matters to be included in the inquiry of the client's attorney.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25572[]' id='answer-id-105652' class='answer   answerof-25572 ' value='105652'   \/><label for='answer-id-105652' id='answer-label-105652' class=' answer'><span>Timing of inventory observation procedures to be performed.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-352' style=';'><div id='questionWrap-352'  class='   watupro-question-id-25573'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>352. <\/span>A successor auditor most likely would make specific inquiries of the predecessor auditor regarding:<\/div><input type='hidden' name='question_id[]' id='qID_352' value='25573' \/><input type='hidden' id='answerType25573' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25573[]' id='answer-id-105653' class='answer   answerof-25573 ' value='105653'   \/><label for='answer-id-105653' id='answer-label-105653' class=' answer'><span>Specialized accounting principles of the client's industry.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25573[]' id='answer-id-105654' class='answer   answerof-25573 ' value='105654'   \/><label for='answer-id-105654' id='answer-label-105654' class=' answer'><span>The competency of the client's internal audit staff.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25573[]' id='answer-id-105655' class='answer   answerof-25573 ' value='105655'   \/><label for='answer-id-105655' id='answer-label-105655' class=' answer'><span>The uncertainty inherent in applying sampling procedures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25573[]' id='answer-id-105656' class='answer   answerof-25573 ' value='105656'   \/><label for='answer-id-105656' id='answer-label-105656' class=' answer'><span>Disagreements with management as to auditing procedures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-353' style=';'><div id='questionWrap-353'  class='   watupro-question-id-25574'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>353. <\/span>Which of the following statements would least likely appear in an auditor's engagement letter?<\/div><input type='hidden' name='question_id[]' id='qID_353' value='25574' \/><input type='hidden' id='answerType25574' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25574[]' id='answer-id-105657' class='answer   answerof-25574 ' value='105657'   \/><label for='answer-id-105657' id='answer-label-105657' class=' answer'><span>Fees for our services are based on our regular per diem rates, plus travel and other out-of-pocket expenses.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25574[]' id='answer-id-105658' class='answer   answerof-25574 ' value='105658'   \/><label for='answer-id-105658' id='answer-label-105658' class=' answer'><span>During the course of our audit we may observe opportunities for economy in, or improved controls over, your operations.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25574[]' id='answer-id-105659' class='answer   answerof-25574 ' value='105659'   \/><label for='answer-id-105659' id='answer-label-105659' class=' answer'><span>Our engagement is subject to the risk that material errors or fraud, including defalcations, if they exist, will not be detected.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25574[]' id='answer-id-105660' class='answer   answerof-25574 ' value='105660'   \/><label for='answer-id-105660' id='answer-label-105660' class=' answer'><span>After performing our preliminary analytical procedures we will discuss with you the other procedures we consider necessary to complete the engagement.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-354' style=';'><div id='questionWrap-354'  class='   watupro-question-id-25575'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>354. <\/span>Which of the following procedures would an auditor most likely perform in planning a financial statement audit?<\/div><input type='hidden' name='question_id[]' id='qID_354' value='25575' \/><input type='hidden' id='answerType25575' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25575[]' id='answer-id-105661' class='answer   answerof-25575 ' value='105661'   \/><label for='answer-id-105661' id='answer-label-105661' class=' answer'><span>Inquiring of the client's legal counsel concerning pending litigation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25575[]' id='answer-id-105662' class='answer   answerof-25575 ' value='105662'   \/><label for='answer-id-105662' id='answer-label-105662' class=' answer'><span>Comparing the financial statements to anticipated results.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25575[]' id='answer-id-105663' class='answer   answerof-25575 ' value='105663'   \/><label for='answer-id-105663' id='answer-label-105663' class=' answer'><span>Examining computer generated exception reports to verify the effectiveness of internal controls.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25575[]' id='answer-id-105664' class='answer   answerof-25575 ' value='105664'   \/><label for='answer-id-105664' id='answer-label-105664' class=' answer'><span>Searching for unauthorized transactions that may aid in detecting unrecorded liabilities.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-355' style=';'><div id='questionWrap-355'  class='   watupro-question-id-25576'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>355. <\/span>The in-charge auditor most likely would have a supervisory responsibility to explain to the staff assistants:<\/div><input type='hidden' name='question_id[]' id='qID_355' value='25576' \/><input type='hidden' id='answerType25576' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25576[]' id='answer-id-105665' class='answer   answerof-25576 ' value='105665'   \/><label for='answer-id-105665' id='answer-label-105665' class=' answer'><span>That fraud is not to be reported to those charged with governance.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25576[]' id='answer-id-105666' class='answer   answerof-25576 ' value='105666'   \/><label for='answer-id-105666' id='answer-label-105666' class=' answer'><span>How the results of various auditing procedures performed by the assistants should be evaluated.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25576[]' id='answer-id-105667' class='answer   answerof-25576 ' value='105667'   \/><label for='answer-id-105667' id='answer-label-105667' class=' answer'><span>What benefits may be attained by the assistants' adherence to established time budgets.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25576[]' id='answer-id-105668' class='answer   answerof-25576 ' value='105668'   \/><label for='answer-id-105668' id='answer-label-105668' class=' answer'><span>Why certain documents are being transferred from the current file to the permanent file.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-356' style=';'><div id='questionWrap-356'  class='   watupro-question-id-25577'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>356. <\/span>Analytical procedures used in planning an audit should focus on:<\/div><input type='hidden' name='question_id[]' id='qID_356' value='25577' \/><input type='hidden' id='answerType25577' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25577[]' id='answer-id-105669' class='answer   answerof-25577 ' value='105669'   \/><label for='answer-id-105669' id='answer-label-105669' class=' answer'><span>Reducing the scope of tests of controls and substantive tests.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25577[]' id='answer-id-105670' class='answer   answerof-25577 ' value='105670'   \/><label for='answer-id-105670' id='answer-label-105670' class=' answer'><span>Providing assurance that potential material misstatements will be identified.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25577[]' id='answer-id-105671' class='answer   answerof-25577 ' value='105671'   \/><label for='answer-id-105671' id='answer-label-105671' class=' answer'><span>Enhancing the auditor's understanding of the client's business.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25577[]' id='answer-id-105672' class='answer   answerof-25577 ' value='105672'   \/><label for='answer-id-105672' id='answer-label-105672' class=' answer'><span>Assessing the adequacy of the available audit evidence.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-357' style=';'><div id='questionWrap-357'  class='   watupro-question-id-25578'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>357. <\/span>Which of the following relatively small misstatements most likely could have a material effect on an entity's financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_357' value='25578' \/><input type='hidden' id='answerType25578' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25578[]' id='answer-id-105673' class='answer   answerof-25578 ' value='105673'   \/><label for='answer-id-105673' id='answer-label-105673' class=' answer'><span>An illegal payment to a foreign official that was not recorded.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25578[]' id='answer-id-105674' class='answer   answerof-25578 ' value='105674'   \/><label for='answer-id-105674' id='answer-label-105674' class=' answer'><span>A piece of obsolete office equipment that was not retired.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25578[]' id='answer-id-105675' class='answer   answerof-25578 ' value='105675'   \/><label for='answer-id-105675' id='answer-label-105675' class=' answer'><span>A petty cash fund disbursement that was not properly authorized.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25578[]' id='answer-id-105676' class='answer   answerof-25578 ' value='105676'   \/><label for='answer-id-105676' id='answer-label-105676' class=' answer'><span>An uncollectible account receivable that was not written off.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-358' style=';'><div id='questionWrap-358'  class='   watupro-question-id-25579'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>358. <\/span>Which of the following risks may be assessed in nonquantitative terms? <br \/>\r<br><br><img decoding=\"async\" width=414 height=96 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image072.jpg\" v:shapes=\"_x0000_i1060\"><br><\/div><input type='hidden' name='question_id[]' id='qID_358' value='25579' \/><input type='hidden' id='answerType25579' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25579[]' id='answer-id-105677' class='answer   answerof-25579 ' value='105677'   \/><label for='answer-id-105677' id='answer-label-105677' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25579[]' id='answer-id-105678' class='answer   answerof-25579 ' value='105678'   \/><label for='answer-id-105678' id='answer-label-105678' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25579[]' id='answer-id-105679' class='answer   answerof-25579 ' value='105679'   \/><label for='answer-id-105679' id='answer-label-105679' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25579[]' id='answer-id-105680' class='answer   answerof-25579 ' value='105680'   \/><label for='answer-id-105680' id='answer-label-105680' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-359' style=';'><div id='questionWrap-359'  class='   watupro-question-id-25580'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>359. <\/span>Which of the following would an auditor most likely use in determining the auditor's preliminary judgment about materiality?<\/div><input type='hidden' name='question_id[]' id='qID_359' value='25580' \/><input type='hidden' id='answerType25580' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25580[]' id='answer-id-105681' class='answer   answerof-25580 ' value='105681'   \/><label for='answer-id-105681' id='answer-label-105681' class=' answer'><span>The anticipated sample size of the planned substantive tests.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25580[]' id='answer-id-105682' class='answer   answerof-25580 ' value='105682'   \/><label for='answer-id-105682' id='answer-label-105682' class=' answer'><span>The entity's annualized interim financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25580[]' id='answer-id-105683' class='answer   answerof-25580 ' value='105683'   \/><label for='answer-id-105683' id='answer-label-105683' class=' answer'><span>The results of the internal control questionnaire.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25580[]' id='answer-id-105684' class='answer   answerof-25580 ' value='105684'   \/><label for='answer-id-105684' id='answer-label-105684' class=' answer'><span>The contents of the management representation letter.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-360' style=';'><div id='questionWrap-360'  class='   watupro-question-id-25581'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>360. <\/span>An auditor should design the written audit plan so that:<\/div><input type='hidden' name='question_id[]' id='qID_360' value='25581' \/><input type='hidden' id='answerType25581' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25581[]' id='answer-id-105685' class='answer   answerof-25581 ' value='105685'   \/><label for='answer-id-105685' id='answer-label-105685' class=' answer'><span>All material transactions will be selected for substantive testing.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25581[]' id='answer-id-105686' class='answer   answerof-25581 ' value='105686'   \/><label for='answer-id-105686' id='answer-label-105686' class=' answer'><span>Substantive tests prior to the balance sheet date will be minimized.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25581[]' id='answer-id-105687' class='answer   answerof-25581 ' value='105687'   \/><label for='answer-id-105687' id='answer-label-105687' class=' answer'><span>The audit procedures selected will achieve specific audit objectives.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25581[]' id='answer-id-105688' class='answer   answerof-25581 ' value='105688'   \/><label for='answer-id-105688' id='answer-label-105688' class=' answer'><span>Each account balance will be tested under either tests of controls or tests of transactions.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-361' style=';'><div id='questionWrap-361'  class='   watupro-question-id-25582'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>361. <\/span>In auditing the financial statements of Star Corp., Land discovered information leading Land to believe that Star's prior year's financial statements, which were audited by Tell, require substantial revisions. <br \/>\r<br>Under these circumstances, Land should:<\/div><input type='hidden' name='question_id[]' id='qID_361' value='25582' \/><input type='hidden' id='answerType25582' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25582[]' id='answer-id-105689' class='answer   answerof-25582 ' value='105689'   \/><label for='answer-id-105689' id='answer-label-105689' class=' answer'><span>Notify Star's audit committee and stockholders that the prior year's financial statements cannot be relied on.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25582[]' id='answer-id-105690' class='answer   answerof-25582 ' value='105690'   \/><label for='answer-id-105690' id='answer-label-105690' class=' answer'><span>Request Star to reissue the prior year's financial statements with the appropriate revisions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25582[]' id='answer-id-105691' class='answer   answerof-25582 ' value='105691'   \/><label for='answer-id-105691' id='answer-label-105691' class=' answer'><span>Notify Tell about the information and make inquiries about the integrity of Star's management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25582[]' id='answer-id-105692' class='answer   answerof-25582 ' value='105692'   \/><label for='answer-id-105692' id='answer-label-105692' class=' answer'><span>Request Star to arrange a meeting among the three parties to resolve the matter.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-362' style=';'><div id='questionWrap-362'  class='   watupro-question-id-25583'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>362. <\/span>An internal auditor's work would most likely affect the nature, timing, and extent of an independent CPA's auditing procedures when the internal auditor's work relates to assertions about the:<\/div><input type='hidden' name='question_id[]' id='qID_362' value='25583' \/><input type='hidden' id='answerType25583' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25583[]' id='answer-id-105693' class='answer   answerof-25583 ' value='105693'   \/><label for='answer-id-105693' id='answer-label-105693' class=' answer'><span>Existence of contingencies.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25583[]' id='answer-id-105694' class='answer   answerof-25583 ' value='105694'   \/><label for='answer-id-105694' id='answer-label-105694' class=' answer'><span>Valuation of intangible assets.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25583[]' id='answer-id-105695' class='answer   answerof-25583 ' value='105695'   \/><label for='answer-id-105695' id='answer-label-105695' class=' answer'><span>Existence of fixed asset additions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25583[]' id='answer-id-105696' class='answer   answerof-25583 ' value='105696'   \/><label for='answer-id-105696' id='answer-label-105696' class=' answer'><span>Valuation of related party transactions.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-363' style=';'><div id='questionWrap-363'  class='   watupro-question-id-25584'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>363. <\/span>During an audit an internal auditor may provide direct assistance to an independent CPA in: <br \/>\r<br><br><img decoding=\"async\" width=576 height=117 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image074.jpg\" v:shapes=\"_x0000_i1061\"><br><\/div><input type='hidden' name='question_id[]' id='qID_363' value='25584' \/><input type='hidden' id='answerType25584' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25584[]' id='answer-id-105697' class='answer   answerof-25584 ' value='105697'   \/><label for='answer-id-105697' id='answer-label-105697' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25584[]' id='answer-id-105698' class='answer   answerof-25584 ' value='105698'   \/><label for='answer-id-105698' id='answer-label-105698' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25584[]' id='answer-id-105699' class='answer   answerof-25584 ' value='105699'   \/><label for='answer-id-105699' id='answer-label-105699' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25584[]' id='answer-id-105700' class='answer   answerof-25584 ' value='105700'   \/><label for='answer-id-105700' id='answer-label-105700' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-364' style=';'><div id='questionWrap-364'  class='   watupro-question-id-25585'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>364. <\/span>Which of the following statements is correct concerning an auditor's use of the work of a specialist?<\/div><input type='hidden' name='question_id[]' id='qID_364' value='25585' \/><input type='hidden' id='answerType25585' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25585[]' id='answer-id-105701' class='answer   answerof-25585 ' value='105701'   \/><label for='answer-id-105701' id='answer-label-105701' class=' answer'><span>The work of a specialist who is related to the client may be acceptable under certain circumstances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25585[]' id='answer-id-105702' class='answer   answerof-25585 ' value='105702'   \/><label for='answer-id-105702' id='answer-label-105702' class=' answer'><span>If an auditor believes that the determinations made by a specialist are unreasonable, only a qualified opinion may be issued.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25585[]' id='answer-id-105703' class='answer   answerof-25585 ' value='105703'   \/><label for='answer-id-105703' id='answer-label-105703' class=' answer'><span>If there is a material difference between a specialist's findings and the assertions in the financial statements, only an adverse opinion may be issued.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25585[]' id='answer-id-105704' class='answer   answerof-25585 ' value='105704'   \/><label for='answer-id-105704' id='answer-label-105704' class=' answer'><span>An auditor may not use a specialist in the determination of physical characteristics relating to inventories.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-365' style=';'><div id='questionWrap-365'  class='   watupro-question-id-25586'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>365. <\/span>In using the work of a specialist, an auditor of a nonissuer may refer to the specialist in the auditor's report if, as a result of the specialist's findings, the auditor:<\/div><input type='hidden' name='question_id[]' id='qID_365' value='25586' \/><input type='hidden' id='answerType25586' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25586[]' id='answer-id-105705' class='answer   answerof-25586 ' value='105705'   \/><label for='answer-id-105705' id='answer-label-105705' class=' answer'><span>Becomes aware of conditions causing substantial doubt about the entity's ability to continue as a going concern.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25586[]' id='answer-id-105706' class='answer   answerof-25586 ' value='105706'   \/><label for='answer-id-105706' id='answer-label-105706' class=' answer'><span>Desires to disclose the specialist's findings, which imply that a more thorough audit was performed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25586[]' id='answer-id-105707' class='answer   answerof-25586 ' value='105707'   \/><label for='answer-id-105707' id='answer-label-105707' class=' answer'><span>Is able to corroborate another specialist's earlier findings that were consistent with management's representations.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25586[]' id='answer-id-105708' class='answer   answerof-25586 ' value='105708'   \/><label for='answer-id-105708' id='answer-label-105708' class=' answer'><span>Discovers significant deficiencies in the design of the entity's internal control that management does not correct.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-366' style=';'><div id='questionWrap-366'  class='   watupro-question-id-25587'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>366. <\/span>Which of the following procedures would an auditor most likely include in the initial planning of a financial statement audit?<\/div><input type='hidden' name='question_id[]' id='qID_366' value='25587' \/><input type='hidden' id='answerType25587' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25587[]' id='answer-id-105709' class='answer   answerof-25587 ' value='105709'   \/><label for='answer-id-105709' id='answer-label-105709' class=' answer'><span>Obtaining a written representation letter from the client's management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25587[]' id='answer-id-105710' class='answer   answerof-25587 ' value='105710'   \/><label for='answer-id-105710' id='answer-label-105710' class=' answer'><span>Examining documents to detect illegal acts having a material effect on the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25587[]' id='answer-id-105711' class='answer   answerof-25587 ' value='105711'   \/><label for='answer-id-105711' id='answer-label-105711' class=' answer'><span>Considering whether the client's accounting estimates are reasonable in the circumstances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25587[]' id='answer-id-105712' class='answer   answerof-25587 ' value='105712'   \/><label for='answer-id-105712' id='answer-label-105712' class=' answer'><span>Determining the extent of involvement of the client's internal auditors.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-367' style=';'><div id='questionWrap-367'  class='   watupro-question-id-25588'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>367. <\/span>Which of the following factors most likely would influence an auditor's determination of the auditability of an entity's financial statements?<\/div><input type='hidden' name='question_id[]' id='qID_367' value='25588' \/><input type='hidden' id='answerType25588' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25588[]' id='answer-id-105713' class='answer   answerof-25588 ' value='105713'   \/><label for='answer-id-105713' id='answer-label-105713' class=' answer'><span>The complexity of the information system relevant to financial reporting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25588[]' id='answer-id-105714' class='answer   answerof-25588 ' value='105714'   \/><label for='answer-id-105714' id='answer-label-105714' class=' answer'><span>The existence of related party transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25588[]' id='answer-id-105715' class='answer   answerof-25588 ' value='105715'   \/><label for='answer-id-105715' id='answer-label-105715' class=' answer'><span>The adequacy of the accounting records.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25588[]' id='answer-id-105716' class='answer   answerof-25588 ' value='105716'   \/><label for='answer-id-105716' id='answer-label-105716' class=' answer'><span>The operating effectiveness of controls.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-368' style=';'><div id='questionWrap-368'  class='   watupro-question-id-25589'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>368. <\/span>Hill, CPA, has been retained to audit the financial statements of Monday Co. Monday's predecessor auditor was Post, CPA, who has been notified by Monday that Post's services have been terminated. <br \/>\r<br>Under these circumstances, which party should initiate the communications between Hill and Post?<\/div><input type='hidden' name='question_id[]' id='qID_368' value='25589' \/><input type='hidden' id='answerType25589' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25589[]' id='answer-id-105717' class='answer   answerof-25589 ' value='105717'   \/><label for='answer-id-105717' id='answer-label-105717' class=' answer'><span>Hill, the successor auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25589[]' id='answer-id-105718' class='answer   answerof-25589 ' value='105718'   \/><label for='answer-id-105718' id='answer-label-105718' class=' answer'><span>Post, the predecessor auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25589[]' id='answer-id-105719' class='answer   answerof-25589 ' value='105719'   \/><label for='answer-id-105719' id='answer-label-105719' class=' answer'><span>Monday's controller or CF<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25589[]' id='answer-id-105720' class='answer   answerof-25589 ' value='105720'   \/><label for='answer-id-105720' id='answer-label-105720' class=' answer'><span>The chairman of Monday's board of directors.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-369' style=';'><div id='questionWrap-369'  class='   watupro-question-id-25590'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>369. <\/span>The senior auditor responsible for coordinating the fieldwork usually schedules a pre-audit conference with the audit team primarily to:<\/div><input type='hidden' name='question_id[]' id='qID_369' value='25590' \/><input type='hidden' id='answerType25590' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25590[]' id='answer-id-105721' class='answer   answerof-25590 ' value='105721'   \/><label for='answer-id-105721' id='answer-label-105721' class=' answer'><span>Give guidance to the staff regarding both technical and personnel aspects of the audit.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25590[]' id='answer-id-105722' class='answer   answerof-25590 ' value='105722'   \/><label for='answer-id-105722' id='answer-label-105722' class=' answer'><span>Discuss staff suggestions concerning the establishment and maintenance of time budgets.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25590[]' id='answer-id-105723' class='answer   answerof-25590 ' value='105723'   \/><label for='answer-id-105723' id='answer-label-105723' class=' answer'><span>Establish the need for using the work of specialists and internal auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25590[]' id='answer-id-105724' class='answer   answerof-25590 ' value='105724'   \/><label for='answer-id-105724' id='answer-label-105724' class=' answer'><span>Provide an opportunity to document staff disagreements regarding technical issues.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-370' style=';'><div id='questionWrap-370'  class='   watupro-question-id-25591'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>370. <\/span>To obtain an understanding of a continuing client's business in planning an audit, an auditor most likely would:<\/div><input type='hidden' name='question_id[]' id='qID_370' value='25591' \/><input type='hidden' id='answerType25591' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25591[]' id='answer-id-105725' class='answer   answerof-25591 ' value='105725'   \/><label for='answer-id-105725' id='answer-label-105725' class=' answer'><span>Perform tests of details of transactions and balances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25591[]' id='answer-id-105726' class='answer   answerof-25591 ' value='105726'   \/><label for='answer-id-105726' id='answer-label-105726' class=' answer'><span>Review prior-year audit documentation and the permanent file for the client.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25591[]' id='answer-id-105727' class='answer   answerof-25591 ' value='105727'   \/><label for='answer-id-105727' id='answer-label-105727' class=' answer'><span>Read specialized industry journals.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25591[]' id='answer-id-105728' class='answer   answerof-25591 ' value='105728'   \/><label for='answer-id-105728' id='answer-label-105728' class=' answer'><span>Reevaluate the client's internal control environment.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-371' style=';'><div id='questionWrap-371'  class='   watupro-question-id-25592'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>371. <\/span>In planning an audit of a new client, an auditor most likely would consider the methods used to process accounting information because such methods:<\/div><input type='hidden' name='question_id[]' id='qID_371' value='25592' \/><input type='hidden' id='answerType25592' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25592[]' id='answer-id-105729' class='answer   answerof-25592 ' value='105729'   \/><label for='answer-id-105729' id='answer-label-105729' class=' answer'><span>Influence the design of internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25592[]' id='answer-id-105730' class='answer   answerof-25592 ' value='105730'   \/><label for='answer-id-105730' id='answer-label-105730' class=' answer'><span>Affect the auditor's preliminary judgment about materiality levels.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25592[]' id='answer-id-105731' class='answer   answerof-25592 ' value='105731'   \/><label for='answer-id-105731' id='answer-label-105731' class=' answer'><span>Assist in evaluating the planned audit objectives.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25592[]' id='answer-id-105732' class='answer   answerof-25592 ' value='105732'   \/><label for='answer-id-105732' id='answer-label-105732' class=' answer'><span>Determine the auditor's acceptable level of audit risk.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-372' style=';'><div id='questionWrap-372'  class='   watupro-question-id-25593'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>372. <\/span>The existence of audit risk is recognized by the statement in the auditor's standard report that the:<\/div><input type='hidden' name='question_id[]' id='qID_372' value='25593' \/><input type='hidden' id='answerType25593' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25593[]' id='answer-id-105733' class='answer   answerof-25593 ' value='105733'   \/><label for='answer-id-105733' id='answer-label-105733' class=' answer'><span>Auditor is responsible for expressing an opinion on the financial statements, which are the responsibility of management.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25593[]' id='answer-id-105734' class='answer   answerof-25593 ' value='105734'   \/><label for='answer-id-105734' id='answer-label-105734' class=' answer'><span>Financial statements are presented fairly, in all material respects, in conformity with GAA<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25593[]' id='answer-id-105735' class='answer   answerof-25593 ' value='105735'   \/><label for='answer-id-105735' id='answer-label-105735' class=' answer'><span>Audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25593[]' id='answer-id-105736' class='answer   answerof-25593 ' value='105736'   \/><label for='answer-id-105736' id='answer-label-105736' class=' answer'><span>Auditor obtains reasonable assurance about whether the financial statements are free of material misstatement.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-373' style=';'><div id='questionWrap-373'  class='   watupro-question-id-25594'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>373. <\/span>Which of the following statements is not correct about materiality?<\/div><input type='hidden' name='question_id[]' id='qID_373' value='25594' \/><input type='hidden' id='answerType25594' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25594[]' id='answer-id-105737' class='answer   answerof-25594 ' value='105737'   \/><label for='answer-id-105737' id='answer-label-105737' class=' answer'><span>The concept of materiality recognizes that some matters are important for fair presentation of financial statements in conformity with GAAP, while other matters are not important.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25594[]' id='answer-id-105738' class='answer   answerof-25594 ' value='105738'   \/><label for='answer-id-105738' id='answer-label-105738' class=' answer'><span>An auditor considers materiality for planning purposes in terms of the largest aggregate level of misstatements that could be material to any one of the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25594[]' id='answer-id-105739' class='answer   answerof-25594 ' value='105739'   \/><label for='answer-id-105739' id='answer-label-105739' class=' answer'><span>Materiality judgments are made in light of surrounding circumstances and necessarily involve both quantitative and qualitative judgments.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25594[]' id='answer-id-105740' class='answer   answerof-25594 ' value='105740'   \/><label for='answer-id-105740' id='answer-label-105740' class=' answer'><span>An auditor's consideration of materiality is influenced by the auditor's perception of the needs of a reasonable person who will rely on the financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-374' style=';'><div id='questionWrap-374'  class='   watupro-question-id-25595'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>374. <\/span>Which of the following documentation is not required for an audit in accordance with generally accepted auditing standards?<\/div><input type='hidden' name='question_id[]' id='qID_374' value='25595' \/><input type='hidden' id='answerType25595' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25595[]' id='answer-id-105741' class='answer   answerof-25595 ' value='105741'   \/><label for='answer-id-105741' id='answer-label-105741' class=' answer'><span>A written audit plan setting forth the procedures necessary to accomplish the audit's objectives.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25595[]' id='answer-id-105742' class='answer   answerof-25595 ' value='105742'   \/><label for='answer-id-105742' id='answer-label-105742' class=' answer'><span>An indication that the accounting records agree or reconcile with the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25595[]' id='answer-id-105743' class='answer   answerof-25595 ' value='105743'   \/><label for='answer-id-105743' id='answer-label-105743' class=' answer'><span>A client engagement letter that summarizes the timing and details of the auditor's planned fieldwork.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25595[]' id='answer-id-105744' class='answer   answerof-25595 ' value='105744'   \/><label for='answer-id-105744' id='answer-label-105744' class=' answer'><span>The basis for the auditor's decision not to perform tests of controls concurrently with obtaining an understanding of internal control.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-375' style=';'><div id='questionWrap-375'  class='   watupro-question-id-25596'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>375. <\/span>When assessing the internal auditors' competence, the independent CPA should obtain information about the:<\/div><input type='hidden' name='question_id[]' id='qID_375' value='25596' \/><input type='hidden' id='answerType25596' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25596[]' id='answer-id-105745' class='answer   answerof-25596 ' value='105745'   \/><label for='answer-id-105745' id='answer-label-105745' class=' answer'><span>Organizational level to which the internal auditors report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25596[]' id='answer-id-105746' class='answer   answerof-25596 ' value='105746'   \/><label for='answer-id-105746' id='answer-label-105746' class=' answer'><span>Educational background and professional certification of the internal auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25596[]' id='answer-id-105747' class='answer   answerof-25596 ' value='105747'   \/><label for='answer-id-105747' id='answer-label-105747' class=' answer'><span>Policies prohibiting the internal auditors from auditing areas where relatives are employed.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25596[]' id='answer-id-105748' class='answer   answerof-25596 ' value='105748'   \/><label for='answer-id-105748' id='answer-label-105748' class=' answer'><span>Internal auditors' access to records and information that is considered sensitive.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-376' style=';'><div id='questionWrap-376'  class='   watupro-question-id-25597'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>376. <\/span>Which of the following statements is correct about the auditor's use of the work of a specialist?<\/div><input type='hidden' name='question_id[]' id='qID_376' value='25597' \/><input type='hidden' id='answerType25597' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25597[]' id='answer-id-105749' class='answer   answerof-25597 ' value='105749'   \/><label for='answer-id-105749' id='answer-label-105749' class=' answer'><span>The specialist should not have an understanding of the auditor's corroborative use of the specialist's findings.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25597[]' id='answer-id-105750' class='answer   answerof-25597 ' value='105750'   \/><label for='answer-id-105750' id='answer-label-105750' class=' answer'><span>The auditor is required to perform substantive procedures to verify the specialist's assumptions and findings.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25597[]' id='answer-id-105751' class='answer   answerof-25597 ' value='105751'   \/><label for='answer-id-105751' id='answer-label-105751' class=' answer'><span>The client should not have an understanding of the nature of the work to be performed by the specialist.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25597[]' id='answer-id-105752' class='answer   answerof-25597 ' value='105752'   \/><label for='answer-id-105752' id='answer-label-105752' class=' answer'><span>The auditor should obtain an understanding of the methods and assumptions used by the specialist.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-377' style=';'><div id='questionWrap-377'  class='   watupro-question-id-25598'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>377. <\/span>In assessing the competence and objectivity of an entity's internal auditor, an independent auditor least likely would consider information obtained from:<\/div><input type='hidden' name='question_id[]' id='qID_377' value='25598' \/><input type='hidden' id='answerType25598' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25598[]' id='answer-id-105753' class='answer   answerof-25598 ' value='105753'   \/><label for='answer-id-105753' id='answer-label-105753' class=' answer'><span>Discussions with management personnel.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25598[]' id='answer-id-105754' class='answer   answerof-25598 ' value='105754'   \/><label for='answer-id-105754' id='answer-label-105754' class=' answer'><span>External quality reviews of the internal auditor's activities.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25598[]' id='answer-id-105755' class='answer   answerof-25598 ' value='105755'   \/><label for='answer-id-105755' id='answer-label-105755' class=' answer'><span>Previous experience with the internal auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25598[]' id='answer-id-105756' class='answer   answerof-25598 ' value='105756'   \/><label for='answer-id-105756' id='answer-label-105756' class=' answer'><span>The results of analytical procedures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-378' style=';'><div id='questionWrap-378'  class='   watupro-question-id-25599'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>378. <\/span>Before accepting an audit engagement, a successor auditor should make specific inquiries of the predecessor auditor regarding the predecessor's:<\/div><input type='hidden' name='question_id[]' id='qID_378' value='25599' \/><input type='hidden' id='answerType25599' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25599[]' id='answer-id-105757' class='answer   answerof-25599 ' value='105757'   \/><label for='answer-id-105757' id='answer-label-105757' class=' answer'><span>Opinion of any subsequent events occurring since the predecessor's audit report was issued.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25599[]' id='answer-id-105758' class='answer   answerof-25599 ' value='105758'   \/><label for='answer-id-105758' id='answer-label-105758' class=' answer'><span>Understanding as to the reasons for the change of auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25599[]' id='answer-id-105759' class='answer   answerof-25599 ' value='105759'   \/><label for='answer-id-105759' id='answer-label-105759' class=' answer'><span>Awareness of the consistency in the application of GAAP between periods.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25599[]' id='answer-id-105760' class='answer   answerof-25599 ' value='105760'   \/><label for='answer-id-105760' id='answer-label-105760' class=' answer'><span>Evaluation of all matters of continuing accounting significance.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-379' style=';'><div id='questionWrap-379'  class='   watupro-question-id-25600'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>379. <\/span>Which of the following factors most likely would cause an auditor not to accept a new audit engagement?<\/div><input type='hidden' name='question_id[]' id='qID_379' value='25600' \/><input type='hidden' id='answerType25600' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25600[]' id='answer-id-105761' class='answer   answerof-25600 ' value='105761'   \/><label for='answer-id-105761' id='answer-label-105761' class=' answer'><span>An inadequate understanding of the entity's internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25600[]' id='answer-id-105762' class='answer   answerof-25600 ' value='105762'   \/><label for='answer-id-105762' id='answer-label-105762' class=' answer'><span>The close proximity to the end of the entity's fiscal year.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25600[]' id='answer-id-105763' class='answer   answerof-25600 ' value='105763'   \/><label for='answer-id-105763' id='answer-label-105763' class=' answer'><span>Concluding that the entity's management probably lacks integrity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25600[]' id='answer-id-105764' class='answer   answerof-25600 ' value='105764'   \/><label for='answer-id-105764' id='answer-label-105764' class=' answer'><span>An inability to perform preliminary analytical procedures before accepting the engagement.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-380' style=';'><div id='questionWrap-380'  class='   watupro-question-id-25601'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>380. <\/span>The audit work performed by each assistant should be reviewed to determine whether it was adequately performed and to evaluate whether the:<\/div><input type='hidden' name='question_id[]' id='qID_380' value='25601' \/><input type='hidden' id='answerType25601' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25601[]' id='answer-id-105765' class='answer   answerof-25601 ' value='105765'   \/><label for='answer-id-105765' id='answer-label-105765' class=' answer'><span>Auditor's system of quality control has been maintained at a high level.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25601[]' id='answer-id-105766' class='answer   answerof-25601 ' value='105766'   \/><label for='answer-id-105766' id='answer-label-105766' class=' answer'><span>Results are consistent with the conclusions to be presented in the auditor's report.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25601[]' id='answer-id-105767' class='answer   answerof-25601 ' value='105767'   \/><label for='answer-id-105767' id='answer-label-105767' class=' answer'><span>Audit procedures performed are approved in the professional standards.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25601[]' id='answer-id-105768' class='answer   answerof-25601 ' value='105768'   \/><label for='answer-id-105768' id='answer-label-105768' class=' answer'><span>Audit has been performed by persons having adequate technical training and proficiency as auditors.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-381' style=';'><div id='questionWrap-381'  class='   watupro-question-id-25602'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>381. <\/span>An auditor obtains knowledge about a new client's business and its industry to:<\/div><input type='hidden' name='question_id[]' id='qID_381' value='25602' \/><input type='hidden' id='answerType25602' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25602[]' id='answer-id-105769' class='answer   answerof-25602 ' value='105769'   \/><label for='answer-id-105769' id='answer-label-105769' class=' answer'><span>Make constructive suggestions concerning improvements to the client's internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25602[]' id='answer-id-105770' class='answer   answerof-25602 ' value='105770'   \/><label for='answer-id-105770' id='answer-label-105770' class=' answer'><span>Develop an attitude of professional skepticism concerning management's financial statement assertions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25602[]' id='answer-id-105771' class='answer   answerof-25602 ' value='105771'   \/><label for='answer-id-105771' id='answer-label-105771' class=' answer'><span>Evaluate whether the aggregation of known misstatements causes the financial statements taken as a whole to be materially misstated.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25602[]' id='answer-id-105772' class='answer   answerof-25602 ' value='105772'   \/><label for='answer-id-105772' id='answer-label-105772' class=' answer'><span>Understand the events and transactions that may have an effect on the client's financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-382' style=';'><div id='questionWrap-382'  class='   watupro-question-id-25603'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>382. <\/span>The objective of performing analytical procedures in planning an audit is to identify the existence of:<\/div><input type='hidden' name='question_id[]' id='qID_382' value='25603' \/><input type='hidden' id='answerType25603' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25603[]' id='answer-id-105773' class='answer   answerof-25603 ' value='105773'   \/><label for='answer-id-105773' id='answer-label-105773' class=' answer'><span>Unusual transactions and events.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25603[]' id='answer-id-105774' class='answer   answerof-25603 ' value='105774'   \/><label for='answer-id-105774' id='answer-label-105774' class=' answer'><span>Illegal acts that went undetected because of internal control weaknesses.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25603[]' id='answer-id-105775' class='answer   answerof-25603 ' value='105775'   \/><label for='answer-id-105775' id='answer-label-105775' class=' answer'><span>Related party transactions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25603[]' id='answer-id-105776' class='answer   answerof-25603 ' value='105776'   \/><label for='answer-id-105776' id='answer-label-105776' class=' answer'><span>Recorded transactions that were not properly authorized.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-383' style=';'><div id='questionWrap-383'  class='   watupro-question-id-25604'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>383. <\/span>Which of the following is required documentation in an audit in accordance with generally accepted auditing standards?<\/div><input type='hidden' name='question_id[]' id='qID_383' value='25604' \/><input type='hidden' id='answerType25604' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25604[]' id='answer-id-105777' class='answer   answerof-25604 ' value='105777'   \/><label for='answer-id-105777' id='answer-label-105777' class=' answer'><span>A flowchart or narrative of the information system relevant to financial reporting describing the recording and classification of transactions for financial reporting.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25604[]' id='answer-id-105778' class='answer   answerof-25604 ' value='105778'   \/><label for='answer-id-105778' id='answer-label-105778' class=' answer'><span>An audit plan setting forth in detail the procedures necessary to accomplish the engagement's objectives.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25604[]' id='answer-id-105779' class='answer   answerof-25604 ' value='105779'   \/><label for='answer-id-105779' id='answer-label-105779' class=' answer'><span>A planning memorandum establishing the timing of the audit procedures and coordinating the assistance of entity personnel.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25604[]' id='answer-id-105780' class='answer   answerof-25604 ' value='105780'   \/><label for='answer-id-105780' id='answer-label-105780' class=' answer'><span>An internal control questionnaire identifying controls that assure specific objectives will be achieved.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-384' style=';'><div id='questionWrap-384'  class='   watupro-question-id-25605'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>384. <\/span>In using the work of a specialist, an auditor referred to the specialist's findings in the auditor's report. <br \/>\r<br>This would be an appropriate reporting practice if the:<\/div><input type='hidden' name='question_id[]' id='qID_384' value='25605' \/><input type='hidden' id='answerType25605' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25605[]' id='answer-id-105781' class='answer   answerof-25605 ' value='105781'   \/><label for='answer-id-105781' id='answer-label-105781' class=' answer'><span>Client is not familiar with the professional certification, personal reputation, or particular competence of the specialist.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25605[]' id='answer-id-105782' class='answer   answerof-25605 ' value='105782'   \/><label for='answer-id-105782' id='answer-label-105782' class=' answer'><span>Auditor, as a result of the specialist's findings, adds an explanatory paragraph emphasizing a matter regarding the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25605[]' id='answer-id-105783' class='answer   answerof-25605 ' value='105783'   \/><label for='answer-id-105783' id='answer-label-105783' class=' answer'><span>Auditor understands the form and content of the specialist's findings in relation to the representations in the financial statements.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25605[]' id='answer-id-105784' class='answer   answerof-25605 ' value='105784'   \/><label for='answer-id-105784' id='answer-label-105784' class=' answer'><span>Auditor, as a result of the specialist's findings, decides to indicate a division of responsibility with the specialist.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-385' style=';'><div id='questionWrap-385'  class='   watupro-question-id-25606'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>385. <\/span>The auditor with final responsibility for an engagement and one of the assistants have a difference of opinion about the results of an auditing procedure. <br \/>\r<br>If the assistant believes it is necessary to be disassociated from the matter's resolution, the CPA firm's procedures should enable the assistant to:<\/div><input type='hidden' name='question_id[]' id='qID_385' value='25606' \/><input type='hidden' id='answerType25606' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25606[]' id='answer-id-105785' class='answer   answerof-25606 ' value='105785'   \/><label for='answer-id-105785' id='answer-label-105785' class=' answer'><span>Refer the disagreement to the AICPA's Quality Review Committee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25606[]' id='answer-id-105786' class='answer   answerof-25606 ' value='105786'   \/><label for='answer-id-105786' id='answer-label-105786' class=' answer'><span>Document the details of the disagreement with the conclusion reached.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25606[]' id='answer-id-105787' class='answer   answerof-25606 ' value='105787'   \/><label for='answer-id-105787' id='answer-label-105787' class=' answer'><span>Discuss the disagreement with the entity's management or its audit committee.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25606[]' id='answer-id-105788' class='answer   answerof-25606 ' value='105788'   \/><label for='answer-id-105788' id='answer-label-105788' class=' answer'><span>Report the disagreement to an impartial peer review monitoring team.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-386' style=';'><div id='questionWrap-386'  class='   watupro-question-id-25607'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>386. <\/span>Before accepting an engagement to audit a new client, an auditor is required to:<\/div><input type='hidden' name='question_id[]' id='qID_386' value='25607' \/><input type='hidden' id='answerType25607' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25607[]' id='answer-id-105789' class='answer   answerof-25607 ' value='105789'   \/><label for='answer-id-105789' id='answer-label-105789' class=' answer'><span>Make inquiries of the predecessor auditor after obtaining the consent of the prospective client.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25607[]' id='answer-id-105790' class='answer   answerof-25607 ' value='105790'   \/><label for='answer-id-105790' id='answer-label-105790' class=' answer'><span>Obtain an understanding of the entity and its environment, including its internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25607[]' id='answer-id-105791' class='answer   answerof-25607 ' value='105791'   \/><label for='answer-id-105791' id='answer-label-105791' class=' answer'><span>Prepare a memorandum setting forth the staffing requirements and documenting the preliminary audit plan.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25607[]' id='answer-id-105792' class='answer   answerof-25607 ' value='105792'   \/><label for='answer-id-105792' id='answer-label-105792' class=' answer'><span>Discuss the management representation letter with the prospective client's audit committee.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-387' style=';'><div id='questionWrap-387'  class='   watupro-question-id-25608'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>387. <\/span>In considering materiality for planning purposes, an auditor believes that misstatements aggregating $10,000 would have a material effect on an entity's income statement, but that misstatements would have to aggregate $20,000 to materially affect the balance sheet. <br \/>\r<br>Ordinarily, it would be appropriate to design auditing procedures that would be expected to detect misstatements that aggregate:<\/div><input type='hidden' name='question_id[]' id='qID_387' value='25608' \/><input type='hidden' id='answerType25608' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25608[]' id='answer-id-105793' class='answer   answerof-25608 ' value='105793'   \/><label for='answer-id-105793' id='answer-label-105793' class=' answer'><span>$10,000<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25608[]' id='answer-id-105794' class='answer   answerof-25608 ' value='105794'   \/><label for='answer-id-105794' id='answer-label-105794' class=' answer'><span>$15,000<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25608[]' id='answer-id-105795' class='answer   answerof-25608 ' value='105795'   \/><label for='answer-id-105795' id='answer-label-105795' class=' answer'><span>$20,000<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25608[]' id='answer-id-105796' class='answer   answerof-25608 ' value='105796'   \/><label for='answer-id-105796' id='answer-label-105796' class=' answer'><span>$30,000<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-388' style=';'><div id='questionWrap-388'  class='   watupro-question-id-25609'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>388. <\/span>Analytical procedures used in planning an audit should focus on:<\/div><input type='hidden' name='question_id[]' id='qID_388' value='25609' \/><input type='hidden' id='answerType25609' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25609[]' id='answer-id-105797' class='answer   answerof-25609 ' value='105797'   \/><label for='answer-id-105797' id='answer-label-105797' class=' answer'><span>Evaluating the adequacy of evidence gathered concerning unusual balances.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25609[]' id='answer-id-105798' class='answer   answerof-25609 ' value='105798'   \/><label for='answer-id-105798' id='answer-label-105798' class=' answer'><span>Testing individual account balances that depend on accounting estimates.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25609[]' id='answer-id-105799' class='answer   answerof-25609 ' value='105799'   \/><label for='answer-id-105799' id='answer-label-105799' class=' answer'><span>Enhancing the auditor's understanding of the client's business.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25609[]' id='answer-id-105800' class='answer   answerof-25609 ' value='105800'   \/><label for='answer-id-105800' id='answer-label-105800' class=' answer'><span>Identifying material weaknesses in internal control.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-389' style=';'><div id='questionWrap-389'  class='   watupro-question-id-25610'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>389. <\/span>For which of the following judgments may an independent auditor share responsibility with an entity's internal auditor who is assessed to be both competent and objective? <br \/>\r<br><br><img decoding=\"async\" width=511 height=95 src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/uploads\/2018\/exams\/AUD%20V8.files\/image076.jpg\" v:shapes=\"_x0000_i1062\"><br><\/div><input type='hidden' name='question_id[]' id='qID_389' value='25610' \/><input type='hidden' id='answerType25610' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25610[]' id='answer-id-105801' class='answer   answerof-25610 ' value='105801'   \/><label for='answer-id-105801' id='answer-label-105801' class=' answer'><span>Option A<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25610[]' id='answer-id-105802' class='answer   answerof-25610 ' value='105802'   \/><label for='answer-id-105802' id='answer-label-105802' class=' answer'><span>Option B<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25610[]' id='answer-id-105803' class='answer   answerof-25610 ' value='105803'   \/><label for='answer-id-105803' id='answer-label-105803' class=' answer'><span>Option C<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25610[]' id='answer-id-105804' class='answer   answerof-25610 ' value='105804'   \/><label for='answer-id-105804' id='answer-label-105804' class=' answer'><span>Option D<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-390' style=';'><div id='questionWrap-390'  class='   watupro-question-id-25611'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>390. <\/span>Which of the following procedures would an auditor least likely perform in planning a financial statement audit?<\/div><input type='hidden' name='question_id[]' id='qID_390' value='25611' \/><input type='hidden' id='answerType25611' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25611[]' id='answer-id-105805' class='answer   answerof-25611 ' value='105805'   \/><label for='answer-id-105805' id='answer-label-105805' class=' answer'><span>Coordinating the assistance of entity personnel in data preparation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25611[]' id='answer-id-105806' class='answer   answerof-25611 ' value='105806'   \/><label for='answer-id-105806' id='answer-label-105806' class=' answer'><span>Discussing matters that may affect the audit with firm personnel responsible for non-audit services to the entity.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25611[]' id='answer-id-105807' class='answer   answerof-25611 ' value='105807'   \/><label for='answer-id-105807' id='answer-label-105807' class=' answer'><span>Selecting a sample of vendors' invoices for comparison to receiving reports.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25611[]' id='answer-id-105808' class='answer   answerof-25611 ' value='105808'   \/><label for='answer-id-105808' id='answer-label-105808' class=' answer'><span>Reading the current year's interim financial statements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-391' style=';'><div id='questionWrap-391'  class='   watupro-question-id-25612'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>391. <\/span>When assessing an internal auditor's competence, a CPA ordinarily obtains information about all of the following, except:<\/div><input type='hidden' name='question_id[]' id='qID_391' value='25612' \/><input type='hidden' id='answerType25612' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25612[]' id='answer-id-105809' class='answer   answerof-25612 ' value='105809'   \/><label for='answer-id-105809' id='answer-label-105809' class=' answer'><span>Quality of audit documentation.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25612[]' id='answer-id-105810' class='answer   answerof-25612 ' value='105810'   \/><label for='answer-id-105810' id='answer-label-105810' class=' answer'><span>Educational level and professional experience.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25612[]' id='answer-id-105811' class='answer   answerof-25612 ' value='105811'   \/><label for='answer-id-105811' id='answer-label-105811' class=' answer'><span>The audit plan and audit procedures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25612[]' id='answer-id-105812' class='answer   answerof-25612 ' value='105812'   \/><label for='answer-id-105812' id='answer-label-105812' class=' answer'><span>Access to information about related parties.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-392' style=';'><div id='questionWrap-392'  class='   watupro-question-id-25613'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>392. <\/span>When an auditor increases the assessed level of control risk because certain control activities were determined to be ineffective, the auditor most likely would increase the:<\/div><input type='hidden' name='question_id[]' id='qID_392' value='25613' \/><input type='hidden' id='answerType25613' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25613[]' id='answer-id-105813' class='answer   answerof-25613 ' value='105813'   \/><label for='answer-id-105813' id='answer-label-105813' class=' answer'><span>Level of detection risk.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25613[]' id='answer-id-105814' class='answer   answerof-25613 ' value='105814'   \/><label for='answer-id-105814' id='answer-label-105814' class=' answer'><span>Extent of tests of details.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25613[]' id='answer-id-105815' class='answer   answerof-25613 ' value='105815'   \/><label for='answer-id-105815' id='answer-label-105815' class=' answer'><span>Level of inherent risk.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25613[]' id='answer-id-105816' class='answer   answerof-25613 ' value='105816'   \/><label for='answer-id-105816' id='answer-label-105816' class=' answer'><span>Extent of tests of controls.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-393' style=';'><div id='questionWrap-393'  class='   watupro-question-id-25614'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>393. <\/span>A CPA wishes to determine how various publicly-held companies have complied with the disclosure requirements in a Statement of Financial Accounting Standards. <br \/>\r<br>Which of the following information sources would the CPA most likely consult for this information?<\/div><input type='hidden' name='question_id[]' id='qID_393' value='25614' \/><input type='hidden' id='answerType25614' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25614[]' id='answer-id-105817' class='answer   answerof-25614 ' value='105817'   \/><label for='answer-id-105817' id='answer-label-105817' class=' answer'><span>AICPA Accounting Trends &amp; Techniques.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25614[]' id='answer-id-105818' class='answer   answerof-25614 ' value='105818'   \/><label for='answer-id-105818' id='answer-label-105818' class=' answer'><span>FASB Technical Bulletins.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25614[]' id='answer-id-105819' class='answer   answerof-25614 ' value='105819'   \/><label for='answer-id-105819' id='answer-label-105819' class=' answer'><span>AICPA Audit and Accounting Manual.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25614[]' id='answer-id-105820' class='answer   answerof-25614 ' value='105820'   \/><label for='answer-id-105820' id='answer-label-105820' class=' answer'><span>FASB Statements of Financial Accounting Concepts.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-394' style=';'><div id='questionWrap-394'  class='   watupro-question-id-25615'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>394. <\/span>An auditor's engagement letter most likely would include a statement regarding:<\/div><input type='hidden' name='question_id[]' id='qID_394' value='25615' \/><input type='hidden' id='answerType25615' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25615[]' id='answer-id-105821' class='answer   answerof-25615 ' value='105821'   \/><label for='answer-id-105821' id='answer-label-105821' class=' answer'><span>Management's responsibility to provide certain written representations to the auditor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25615[]' id='answer-id-105822' class='answer   answerof-25615 ' value='105822'   \/><label for='answer-id-105822' id='answer-label-105822' class=' answer'><span>Conditions under which the auditor may modify the preliminary judgment about materiality.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25615[]' id='answer-id-105823' class='answer   answerof-25615 ' value='105823'   \/><label for='answer-id-105823' id='answer-label-105823' class=' answer'><span>Internal control activities that would reduce the auditor's assessment of risk.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25615[]' id='answer-id-105824' class='answer   answerof-25615 ' value='105824'   \/><label for='answer-id-105824' id='answer-label-105824' class=' answer'><span>Materiality matters that could modify the auditor's preliminary assessment of fraud risk.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-395' style=';'><div id='questionWrap-395'  class='   watupro-question-id-25616'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>395. <\/span>A successor auditor should make specific and reasonable inquiries of the predecessor auditor regarding the predecessor's:<\/div><input type='hidden' name='question_id[]' id='qID_395' value='25616' \/><input type='hidden' id='answerType25616' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25616[]' id='answer-id-105825' class='answer   answerof-25616 ' value='105825'   \/><label for='answer-id-105825' id='answer-label-105825' class=' answer'><span>Understanding of the reasons for the change in auditors.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25616[]' id='answer-id-105826' class='answer   answerof-25616 ' value='105826'   \/><label for='answer-id-105826' id='answer-label-105826' class=' answer'><span>Methodology used in applying sampling techniques.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25616[]' id='answer-id-105827' class='answer   answerof-25616 ' value='105827'   \/><label for='answer-id-105827' id='answer-label-105827' class=' answer'><span>Opinion on subsequent events that have occurred since the balance sheet date.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25616[]' id='answer-id-105828' class='answer   answerof-25616 ' value='105828'   \/><label for='answer-id-105828' id='answer-label-105828' class=' answer'><span>Perception of the competency and reliance on the client's internal audit function.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-396' style=';'><div id='questionWrap-396'  class='   watupro-question-id-25617'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>396. <\/span>An auditor reviews a client's accounting policies and procedures when considering which of the following planning matters?<\/div><input type='hidden' name='question_id[]' id='qID_396' value='25617' \/><input type='hidden' id='answerType25617' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25617[]' id='answer-id-105829' class='answer   answerof-25617 ' value='105829'   \/><label for='answer-id-105829' id='answer-label-105829' class=' answer'><span>Method of sampling to be used.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25617[]' id='answer-id-105830' class='answer   answerof-25617 ' value='105830'   \/><label for='answer-id-105830' id='answer-label-105830' class=' answer'><span>Preliminary judgments about materiality levels.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25617[]' id='answer-id-105831' class='answer   answerof-25617 ' value='105831'   \/><label for='answer-id-105831' id='answer-label-105831' class=' answer'><span>Nature of reports to be rendered.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25617[]' id='answer-id-105832' class='answer   answerof-25617 ' value='105832'   \/><label for='answer-id-105832' id='answer-label-105832' class=' answer'><span>Understanding the client's operations and business.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-397' style=';'><div id='questionWrap-397'  class='   watupro-question-id-25618'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>397. <\/span>An auditor is required to obtain an understanding of the entity's business, including business cycles and reasons for business fluctuations. <br \/>\r<br>What is the audit purpose most directly served by obtaining this understanding?<\/div><input type='hidden' name='question_id[]' id='qID_397' value='25618' \/><input type='hidden' id='answerType25618' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25618[]' id='answer-id-105833' class='answer   answerof-25618 ' value='105833'   \/><label for='answer-id-105833' id='answer-label-105833' class=' answer'><span>To enable the auditor to accurately identify significant deficiencies in internal control.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25618[]' id='answer-id-105834' class='answer   answerof-25618 ' value='105834'   \/><label for='answer-id-105834' id='answer-label-105834' class=' answer'><span>To assist the auditor in accurately interpreting information obtained during an audit.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25618[]' id='answer-id-105835' class='answer   answerof-25618 ' value='105835'   \/><label for='answer-id-105835' id='answer-label-105835' class=' answer'><span>To allow the auditor to more accurately perform tests of controls.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25618[]' id='answer-id-105836' class='answer   answerof-25618 ' value='105836'   \/><label for='answer-id-105836' id='answer-label-105836' class=' answer'><span>To decide whether it will be necessary to perform analytical procedures.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-398' style=';'><div id='questionWrap-398'  class='   watupro-question-id-25619'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>398. <\/span>A retail entity uses electronic data interchange (EDI) in executing and recording most of its purchase transactions. The entity's auditor recognizes that the documentation of the transactions will be retained for only a short period of time. <br \/>\r<br>To compensate for this limitation, the auditor most likely would:<\/div><input type='hidden' name='question_id[]' id='qID_398' value='25619' \/><input type='hidden' id='answerType25619' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25619[]' id='answer-id-105837' class='answer   answerof-25619 ' value='105837'   \/><label for='answer-id-105837' id='answer-label-105837' class=' answer'><span>Increase the sample of EDI transactions to be selected for cutoff tests.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25619[]' id='answer-id-105838' class='answer   answerof-25619 ' value='105838'   \/><label for='answer-id-105838' id='answer-label-105838' class=' answer'><span>Perform tests several times during the year, rather than only at year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25619[]' id='answer-id-105839' class='answer   answerof-25619 ' value='105839'   \/><label for='answer-id-105839' id='answer-label-105839' class=' answer'><span>Plan to make a 100% count of the entity's inventory at or near the year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25619[]' id='answer-id-105840' class='answer   answerof-25619 ' value='105840'   \/><label for='answer-id-105840' id='answer-label-105840' class=' answer'><span>Decrease the assessed level of control risk for the existence or occurrence assertions.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-399' style=';'><div id='questionWrap-399'  class='   watupro-question-id-25620'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>399. <\/span>An auditor assesses control risk because it:<\/div><input type='hidden' name='question_id[]' id='qID_399' value='25620' \/><input type='hidden' id='answerType25620' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25620[]' id='answer-id-105841' class='answer   answerof-25620 ' value='105841'   \/><label for='answer-id-105841' id='answer-label-105841' class=' answer'><span>Is relevant to the auditor's understanding of the control environment.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25620[]' id='answer-id-105842' class='answer   answerof-25620 ' value='105842'   \/><label for='answer-id-105842' id='answer-label-105842' class=' answer'><span>Provides assurance that the auditor's materiality levels are appropriate.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25620[]' id='answer-id-105843' class='answer   answerof-25620 ' value='105843'   \/><label for='answer-id-105843' id='answer-label-105843' class=' answer'><span>Indicates to the auditor where inherent risk may be the greatest.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25620[]' id='answer-id-105844' class='answer   answerof-25620 ' value='105844'   \/><label for='answer-id-105844' id='answer-label-105844' class=' answer'><span>Affects the level of detection risk that the auditor may accept.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-400' style=';'><div id='questionWrap-400'  class='   watupro-question-id-25621'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>400. <\/span>As the acceptable level of detection risk decreases, an auditor may:<\/div><input type='hidden' name='question_id[]' id='qID_400' value='25621' \/><input type='hidden' id='answerType25621' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25621[]' id='answer-id-105845' class='answer   answerof-25621 ' value='105845'   \/><label for='answer-id-105845' id='answer-label-105845' class=' answer'><span>Reduce substantive testing by relying on the assessments of inherent risk and control risk.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25621[]' id='answer-id-105846' class='answer   answerof-25621 ' value='105846'   \/><label for='answer-id-105846' id='answer-label-105846' class=' answer'><span>Postpone the planned timing of substantive tests from interim dates to the year-end.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25621[]' id='answer-id-105847' class='answer   answerof-25621 ' value='105847'   \/><label for='answer-id-105847' id='answer-label-105847' class=' answer'><span>Eliminate the assessed level of inherent risk from consideration as a planning factor.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25621[]' id='answer-id-105848' class='answer   answerof-25621 ' value='105848'   \/><label for='answer-id-105848' id='answer-label-105848' class=' answer'><span>Lower the assessed level of control risk.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-401' style=';'><div id='questionWrap-401'  class='   watupro-question-id-25622'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>401. <\/span>Control risk should be assessed in terms of:<\/div><input type='hidden' name='question_id[]' id='qID_401' value='25622' \/><input type='hidden' id='answerType25622' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25622[]' id='answer-id-105849' class='answer   answerof-25622 ' value='105849'   \/><label for='answer-id-105849' id='answer-label-105849' class=' answer'><span>Specific controls.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25622[]' id='answer-id-105850' class='answer   answerof-25622 ' value='105850'   \/><label for='answer-id-105850' id='answer-label-105850' class=' answer'><span>Types of potential irregularities.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25622[]' id='answer-id-105851' class='answer   answerof-25622 ' value='105851'   \/><label for='answer-id-105851' id='answer-label-105851' class=' answer'><span>Financial statement assertions.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25622[]' id='answer-id-105852' class='answer   answerof-25622 ' value='105852'   \/><label for='answer-id-105852' id='answer-label-105852' class=' answer'><span>Control environment factors.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-402' style=';'><div id='questionWrap-402'  class='   watupro-question-id-25623'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>402. <\/span>The acceptable level of detection risk is inversely related to the:<\/div><input type='hidden' name='question_id[]' id='qID_402' value='25623' \/><input type='hidden' id='answerType25623' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25623[]' id='answer-id-105853' class='answer   answerof-25623 ' value='105853'   \/><label for='answer-id-105853' id='answer-label-105853' class=' answer'><span>Assurance provided by substantive tests.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25623[]' id='answer-id-105854' class='answer   answerof-25623 ' value='105854'   \/><label for='answer-id-105854' id='answer-label-105854' class=' answer'><span>Risk of misapplying auditing procedures.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25623[]' id='answer-id-105855' class='answer   answerof-25623 ' value='105855'   \/><label for='answer-id-105855' id='answer-label-105855' class=' answer'><span>Preliminary judgment about materiality levels.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25623[]' id='answer-id-105856' class='answer   answerof-25623 ' value='105856'   \/><label for='answer-id-105856' id='answer-label-105856' class=' answer'><span>Risk of failing to discover material misstatements.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div class='watu-question ' id='question-403' style=';'><div id='questionWrap-403'  class='   watupro-question-id-25624'>\n\t\t\t<div class='question-content'><div><span class='watupro_num'>403. <\/span>Samples to test internal control are intended to provide a basis for an auditor to conclude whether:<\/div><input type='hidden' name='question_id[]' id='qID_403' value='25624' \/><input type='hidden' id='answerType25624' value='radio'><!-- end question-content--><\/div><div class='question-choices watupro-choices-columns '><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25624[]' id='answer-id-105857' class='answer   answerof-25624 ' value='105857'   \/><label for='answer-id-105857' id='answer-label-105857' class=' answer'><span>The control activities are operating effectively.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25624[]' id='answer-id-105858' class='answer   answerof-25624 ' value='105858'   \/><label for='answer-id-105858' id='answer-label-105858' class=' answer'><span>The financial statements are materially misstated.<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25624[]' id='answer-id-105859' class='answer   answerof-25624 ' value='105859'   \/><label for='answer-id-105859' id='answer-label-105859' class=' answer'><span>The risk of incorrect acceptance is too high<\/span><\/label><\/div><div class='watupro-question-choice  ' dir='auto' ><input type='radio' name='answer-25624[]' id='answer-id-105860' class='answer   answerof-25624 ' value='105860'   \/><label for='answer-id-105860' id='answer-label-105860' class=' answer'><span>Materiality for planning purposes is at a sufficiently low level.<\/span><\/label><\/div><!-- end question-choices--><\/div><!-- end questionWrap--><\/div><\/div><div style='display:none' id='question-404'>\n\t<div class='question-content'>\n\t\t<img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.dumpsbase.com\/freedumps\/wp-content\/plugins\/watupro\/img\/loading.gif\" width=\"16\" height=\"16\" alt=\"Loading...\" title=\"Loading...\" \/>&nbsp;Loading...\t<\/div>\n<\/div>\n\n<br \/>\n\t\n\t\t\t<div class=\"watupro_buttons flex \" id=\"watuPROButtons884\" >\n\t\t  <div id=\"prev-question\" style=\"display:none;\"><input type=\"button\" value=\"&lt; Previous\" onclick=\"WatuPRO.nextQuestion(event, 'previous');\"\/><\/div>\t\t  \t\t  \t\t   \n\t\t   \t  \t\t<div><input type=\"button\" name=\"action\" class=\"watupro-submit-button\" onclick=\"WatuPRO.submitResult(event)\" id=\"action-button\" value=\"View Results\"  \/>\n\t\t<\/div>\n\t\t<\/div>\n\t\t\n\t<input type=\"hidden\" name=\"quiz_id\" value=\"884\" id=\"watuPROExamID\"\/>\n\t<input type=\"hidden\" name=\"start_time\" id=\"startTime\" value=\"2026-05-20 04:49:28\" \/>\n\t<input type=\"hidden\" name=\"start_timestamp\" id=\"startTimeStamp\" value=\"1779252568\" \/>\n\t<input type=\"hidden\" name=\"question_ids\" value=\"\" \/>\n\t<input type=\"hidden\" name=\"watupro_questions\" value=\"25222:104216,104217,104218,104219 | 25223:104220,104221,104222,104223 | 25224:104224,104225,104226,104227 | 25225:104228,104229,104230,104231 | 25226:104232,104233,104234,104235 | 25227:104236,104237,104238,104239 | 25228:104240,104241,104242,104243 | 25229:104244,104245,104246,104247 | 25230:104248,104249,104250 | 25231:104251,104252,104253,104254 | 25232:104255,104256,104257,104258 | 25233:104259,104260,104261,104262 | 25234:104263,104264,104265,104266 | 25235:104267,104268,104269,104270 | 25236:104271,104272,104273,104274 | 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