special emphasis on testing the controls over proper classification of payroll transactions?
• Question 6 The reliance placed on substantive tests in relation to the reliance placed on internal control varies in a relationship that is ordinarily
• Question 7 An auditor uses the assessed level of the risk of material misstatement to
• Question 8 The purpose of segregating the duties of hiring personnel and distributing payroll checks is to separate the
• Question 9 An audit client failed to maintain copies of its procedures manuals and organizational flowcharts. What should the auditor do in an audit of financial statements?
• Question 10 As a result of tests of controls, an auditor assesses control risk too high. This incorrect assessment most likely occurred because
• Question 11 To provide assurance that each voucher is submitted and paid only once, an auditor most likely would examine a sample of paid vouchers and determine whether each voucher is
• Question 12 A client erroneously recorded a large purchase twice. Which of the following controls would be most likely to detect this error in a timely and efficient manner?
• Question 13 A client’ s materials-purchasing cycle begins with requisitions from user departments and ends with the receipt of materials and the recognition of a liability. An auditor’ s primary objective in reviewing this cycle is to
• Question 14 The company being audited has an internal auditor that is both competent and objective. The independent auditor wants to assign tasks for the internal auditor to perform. Under these circumstances, the independent auditor may
• Question 15 An effective control that protects against the preparation of improper or inaccurate disbursements would be to require that all checks be
• Question 16 During a financial statement audit an internal auditor may provide direct assistance to the independent CPA in performing