Audit Custom Quiz 2

During the initial planning phase of an audit, a CPA most likely would

Discuss the timing of the audit procedures with the client's management.

The scope and nature of an auditor's contractual obligation to a client is ordinarily set forth in the

Engagement letter.

In developing written audit plans, an auditor should design specific audit procedures that relate primarily to the

Financial statement assertions

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. Under these circumstances, which party should initiate the communications between Hill and Post?

Hill, the auditor.

Which of the following would a successor auditor ask the predecessor auditor to provide after accepting an audit engagement?

Matters that may facilitate the evaluation of financial reporting consistency between the current and prior years.

A precondition for an audit most likely is not present when management

Refuses to acknowledge its responsibility for the fair presentation of the financial statements in accordance with the applicable reporting framework (A precondition for an audit is management's agreement that it acknowledges and understands its responsibilities. These include the preparation and fair presentation of the financial statements in accordance with the applicable reporting framework. If this agreement is not obtained, the auditor should not accept the engagement (AU-C 210).)

Which of the following is an auditor least likely to perform in planning a financial statement audit?

Selecting a sample of vendors' invoices for comparison with receiving reports

Audit plans should be designed so that

The audit evidence gathered supports the auditor's conclusions. (The auditor is responsible for collecting sufficient appropriate audit evidence to be able to draw reasonable conclusions on which to base the opinion. Audit plans describe the steps involved in that process. Thus, the evidence should support the auditor's conclusions.)

The auditor should establish an overall audit strategy. Which one of the following statements is most consistent with this requirement?

The auditor should plan the audit so that it will be performed effectively.

Before accepting an audit engagement, an auditor should make specific inquiries of the predecessor auditor regarding the predecessor's

Understanding as to the reasons for the change of auditors.