Sunteți pe pagina 1din 11

DE LA SALLE UNIVERSITY MANILA

RVR COB DEPARTMENT OF ACCOUNTANCY


REVDEVT 1st Term AY 15 - 16
Integrated Accounting Review
Auditing Theory

AT Quizzer 1

=============================================================================

OVERVIEW OF AUDITING AND ASSURANCE SERVICES


1. Which of the following statements best describes assurance services?
a. Independent professional services that are intended to enhance the credibility of
information to meet the needs of an intended user.
b. Services designed to express an opinion on the fairness of historical financial
statements based on the results of an audit.
c. The preparation of financial statements or the collection, classification, and
summarization of other financial information.
d. Services designed for the improvement of operations, resulting in better outcomes.
2. Which of the following mostly describes the function of AASC?
a. To monitor full compliance by auditors to PSAs.
b. To assist the Board of Accountancy in conducting administrative proceedings on erring
CPAs in audit practice.
c. To promulgate auditing standards, practices and procedures that shall be generally
accepted by the accounting profession in the Philippines.
d. To undertake continuing research on both auditing and financial accounting in order to
make them responsive to the needs of the public.
3. The Philippine Standards on Auditing issued by AASC
a. Apply to independent examination of financial statements of any entity when such
examination is conducted for the purpose of expressing an opinion.
b. Must not apply to other related activities of auditors.
c. Need to be applied on all audit related.
d. Require that in no circumstances would an auditor may judge it necessary to depart
from a PSA, even though such a departure may result to more effective achievement of
the objective of an audit.
4. Assurance services involve all of the following except:
a. Improving the quality of information for decision purposes.
b. Improving the quality of the decision model used.
c. Improving the relevance of information.
d. Implementing a system that improves the processing of information.
5. The primary goal of the CPA in performing the attest function is to
a. Detect fraud.
b. Examine individual transactions so that the auditor may certify as to their validity.
c. Determine whether the clients assertions are fairly stated.
d. Assure the consistent application of correct accounting procedures.
6. Which of the following best describes the objective of an assurance engagement?
a. To improve the companys outcomes.
b. To compare the companys information and policies to those of other entities.
c. To enhance the credibility of information in order to improve the likelihood that the
information will meet the needs of an intended user.
d. None of the above.
7. The following are the elements of an assurance engagement except:
a. Suitable criteria
b. An appropriate subject matter.
c. A two-party relationship involving a practitioner and intended users.
d. Sufficient appropriate evidence.
8. Assurance engagements encompass the following types of services, except
a. Attestation services.
b. Audit of historical financial statements.
c. Review engagements.
d. Management consulting.

Auditing Theory

Quizzer No. 1

2_

9. The Philippine Framework for Assurance Engagements identifies two types of assurance
engagement a practitioner is permitted to perform: a reasonable assurance engagement and a
limited assurance engagement. Which of the following is the objective of a reasonable
assurance engagement?
a. A reduction in assurance engagement risk to a level that is acceptable in the
circumstances of the engagement as a basis for a negative form of expression of the
practitioners conclusion.
b. A reduction in assurance engagement risk to a very low level in the circumstances of
the engagement as a basis for a disclaimer of the practitioners conclusion.
c. A reduction in assurance engagement risk to an acceptably low level that is acceptable
in the circumstances of the engagement as a basis for a positive form of expression of
the practitioners conclusion.
d. A reduction in assurance engagement risk to a level that is acceptable in the
circumstances of the engagement as a basis for a qualified form of the practitioners
conclusion.
10. Assurance engagements involve
a. Two separate parties: a professional accountant and an intended user.
b. Two separate parties: a professional accountant and a responsible party.
c. Two separate parties: a responsible party and an intended user.
d. Three separate parties: a professional accountant, a responsible party, and an
intended user.
11. When performing an assurance service, professional accountants use standards or
benchmarks to evaluate or measure the subject matter of an assurance engagement. This
element of an assurance engagement is called:
a. Criteria
b. Conclusion
c. GAAP
d. Assertion
12. The subject matter of an assertion may include:
a. Historical or prospective financial information.
b. Internal controls.
c. Compliance with regulation.
d. All of the above.
13. In an assurance engagement, the person or class of persons for whom the professional
accountant prepares the report for a specific use or purpose is the:
a. Intended user.
b. Responsible party.
c. Management.
d. Client.
14. An expectation of the public is that the auditor will recognize that the primary users of audit
services are
a. the employees.
b. the Securities and Exchange Commission.
c. the investors and creditors.
d. the board of directors.
15. In the context of the Framework, the auditors satisfaction as to the reliability of an assertion
being made by one party for use by another party is called
a. Opinion.
b. Assurance.
c. Examination.
d. Verification.
16. Which of the following statements concerning the intended user of a professional accountants
report is incorrect?
a. The intended user should never be established by agreement between the professional
accountant and the responsible party or those engaging or employing the professional
accountant.
b. In some circumstances, the intended user may be established by law.
c. The responsible party may also one of the intended users.
d. The responsible party and the intended user may both be within the same organization.
17. When providing consulting services, the CPA acts primarily as a(n):
a. independent accountant
b. expert on compliance with industry standards
c. technology specialist
d. objective advisor on the use of information

Auditing Theory

Quizzer No. 1

3_

18. Which of the following is a difference between attestation standards and auditing standards?
a. Attestation standards cover attest engagements other than those involving GAAP
financial statements.
b. Attestation standards do not require independence in mental attitude.
c. Auditing standards apply only to CPAs while attestation standards apply to all
accountants.
d. Attestation standards do not include standards of reporting.
19. The attest function:
a. Is an essential part of every engagement performed by a CPA.
b. Requires a complete review of all transactions during the period under examination.
c. Requires a review of a sample of transactions during the period under examination.
d. Includes the preparation of a written report of the CPAs conclusion.
20. Assurance services differ from consulting services in that they
I. Focus on providing advice.
II. Involve monitoring of one party by another.
a.
b.
c.
d.

I only.
II only.
Both I and II.
Neither I nor II.

21. Which of the following is a correct statement?


a. An audit provides a limited assurance by attesting to the fairness of the clients
assertions.
b. A review provides positive assurance by attesting the reliability of the clients
assertions.
c. Management consulting services provide attestation in all cases.
d. Accounting services do not provide attestation.
22. Why does a company choose to have an independent auditor report on its financial
statements?
a. Independent auditors will always detect management fraud.
b. The company preparing the statements may have a vested interest in reporting certain
results.
c. Independent auditors guarantee the accuracy of the financial statements.
d. An independent audit is designed to search for deficiencies in the companys internal
controls.
23. Which of the following is responsible for an entitys financial statements?
a. the entitys management
b. the entitys audit committee
c. the entitys internal auditor
d. the entitys board of directors
24. The primary responsibility for the adequacy of disclosure in the financial statements rests with
the
a. Partner assigned to the audit engagement.
b. Management of the company.
c. Securities and Exchange Commission.
d. Auditor in charge of the field work.
25. Independent auditing can be best described as
a. A branch of accounting.
b. A professional activity that measures and communicates financial and business data.
c. A discipline which attests to the results of accounting and other functional operations
and data.
d. A regulatory function that prevents the issuance of improper financial information.
26. Which of the following best describes review services?
a. Review engagements focus on providing assurance on the assertions contained in the
financial statements of a public company.
b. Review engagements focus on providing assurance on the internal controls of a public
company.
c. Review engagements focus on providing limited assurance on financial statements of a
private company.
d. Review engagements focus on providing advice in a three-party contract.

Auditing Theory

Quizzer No. 1

4_

27. The Framework of Philippine Standards on Auditing distinguishes audits from related services.
Related services include all of the following, except:
a. Reviews
b. Agreed-upon procedures.
c. Compilations.
d. Management consulting.
28. When the professional accountant has obtained sufficient appropriate evidence to be satisfied
that the subject matter is plausible in the circumstances, he or she can provide what level of
assurance?
a. None
b. High
c. Moderate
d. Absolute
29. The objective of the attest function is to
a. Ascertain the consistent application of GAAP.
b. Determine the validity of the transactions examined.
c. Express an opinion on the fairness of the financial statements.
d. Detect fraud.
30. A concept relating to the accumulation of the audit evidence necessary for the auditor to
conclude that there are no material misstatement in the financial statements taken as whole is:
a. Reasonable assurance
b. Positive assurance
c. Moderate assurance
d. Negative assurance
31. It is the auditors duty
a. to prevent fraud and error.
b. to obtain reasonable assurance that material misstatements arising from fraud and
error are detected.
c. both a and b
d. neither a nor b
32. Engagements frequently performed by professional accountants that are not assurance
engagements include the following except:
a. Agreed upon procedures
b. Audit of financial statements
c. MAS
d. Compilation of financial statements
33. An assurance engagement
a. Is an engagement in which practitioner is engaged to issue, or does issue, a written
communication that expresses a conclusion about the reliability of a written assertion
that is the responsibility of another party.
b. Is an engagement involving a systematic process of objectively obtaining and
evaluating evidence regarding assertions about economic actions and events, to
ascertain the degree of correspondence between those assertions and established
criteria, and communicating the results to interested users.
c. Is an engagement in which the auditor provides a moderate level of assurance that the
information subject to the engagement is free of material misstatements.
d. Is an engagement intended to enhance the credibility of information about a subject
matter by evaluating whether the subject matter conforms in all material respects with
suitable criteria, thereby, improving the likelihood that the information will meet the
needs of an intended user.
34. The subject matter of an assurance engagement may take many forms, including
a. Data
b. Behavior
c. Systems and processes
d. All of the above
35. A practitioner should plan and conduct the assurance engagement in an effective manner to
meet the objective of the engagement. Which of the following matters need not be a concern of
the practitioner in planning the work?
a. Criteria to be used.
b. Engagement objective.
c. Personnel and expertise requirements.
d. Specific format of the assurance report.

Auditing Theory

Quizzer No. 1

5_

36. Which of the following statements is correct concerning an auditors responsibilities regarding
financial statements?
a. An auditors responsibilities for audited financial statements are confined to the
expression of the auditors opinion.
b. The fair presentation of audited financial statements in conformity with GAAP is an
implicit part of the auditors responsibilities.
c. Making suggestions that are adopted about the form and content of an entitys financial
statements impairs an auditors independence.
d. The auditors report should provide an assurance as to the future viability of the entity.
37. When a CPA expresses an opinion on the financial statements, his responsibilities extend to
a. The underlying wisdom of the clients management decision.
b. Active participation in the implementation of the advice given to the client.
c. An ongoing responsibility for the clients solvency.
d. Whether the results of the clients operating decisions are fairly presented in the
financial statements.
38. The expertise that distinguishes auditors from accountants is in the
a. Ability to interpret generally accepted accounting principles.
b. Requirement to possess education beyond the Bachelors degree.
c. Accumulation and interpretation of evidence.
d. Ability to interpret PAS statements.
39. A financial statement audit aids in the communication of economic data because the audit
a. Assures the readers of the financial statements that any fraudulent activity has been
corrected.
b. Guarantees that the financial data are fairly presented.
c. Lends credibility to the financial statements.
d. Confirms the accuracy of the managements financial representations.
40. The auditors opinion
a. Guarantees the credibility of the financial statements.
b. Is an assurance as to the future viability of the entity.
c. Is not an assurance as to the efficiency with which management has conducted the
affairs of the entity.
d. Detect fraud.
41. Level of assurance provided by the auditors opinion in an audit is
a. absolute
b. high
c. moderate
d. none
42. Level of assurance provided by the auditors opinion in a compilation engagement is:
a. absolute
b. high
c. moderate
d. none
43. Level of assurance provided by the auditors opinion in a review is
a. absolute
b. high
c. moderate
d. none
44. Level of assurance provided by the auditors opinion in an agreed-upon procedures
engagement is:
a. absolute
b. high
c. moderate
d. none
45. Absolute assurance in auditing is not attainable because of
a. the need for judgment.
b. the use of testing
c. the inherent limitation and internal control systems
d. all of the above
46. According to Preface on Assurance Engagements, these are the standards or benchmarks
used to evaluate or measure the subject matter of an assurance engagement:
a. criteria
b. engagement process
c. assertions
d. generally accepted auditing standards

Auditing Theory

Quizzer No. 1

6_

47. The criteria for evaluating quantitative information vary. For example, in the audit of historical
financial statements by CPA firms, the criteria are usually
a. International accounting standards.
b. Generally accepted accounting principles.
c. Regulations of the Bureau of Internal Revenue.
d. Regulations of the Securities and Exchange Commission.
48. The framework for auditing and related services as addressed by PSA includes
a. Reviews
b. Tax services
c. Management Advisory Services
d. Accounting services
49. The framework for auditing and related services as addressed by PSA excludes
a. Review
b. Compilation
c. Management Advisory Services
d. Agreed upon Procedures
50. The decision of whether the criteria are suitable involves considering whether the subject
matter of the assurance engagement is capable of reasonably consistent evaluation or
measurement using such criteria. Which of the following characteristics is not considered
necessary in determining whether the criteria are suitable?
a. Relevance
b. Neutrality
c. Reliability
d. Sufficiency
51. First Statement In exceptional circumstances, an auditor may judge if necessary to depart
from a PSA in order to more effectively achieve the objective of an audit. When such situation
arises, the auditor is not required to justify the departure.
Second Statement PSAs need only be applied to material matters.
a.
b.
c.
d.

Both statements are False


Both statements are True
First statement is True; Second Statement is False
First statement is False; Second Statement is True

52. An auditor needs not abide by a Philippine Standard on Auditing if the auditor believes that
a. The amount is insignificant.
b. The requirement of the PSA is impractical to perform.
c. The requirement of the PSA is impossible to perform.
d. Any of the above three is correct.
53. According to PSA 120, a compilation presents information in the form of financial statements,
that is, the representation of management. The accountant who prepares the compilation
undertakes to express
a. limited assurance on the statements
b. minimal assurance on the statements
c. no assurance on the statements
d. full assurance on the statements
54. In an engagement to perform agreed upon procedures, an auditor is engaged to
a. Carry out those procedures of an audit to which the auditor and the entity and any
appropriate third parties have agreed and to report on factual findings.
b. Use accounting expertise as opposed to auditing expertise to collect, classify, and
summarize financial information.
c. Provide a moderate level of assurance that the information is free of material
misstatement.
d. Provide a high, but not absolute level of assurance that the information is free of
material misstatement.
55. Which of the following is least likely considered a part of the financial reporting framework?
a. Generally accepted auditing standards (GAAS).
b. Generally accepted accounting principles (GAAP).
c. International Accounting Standards/International Financial Reporting Standards
(IAS/IFRS).
d. Another authoritative and comprehensive basis of reporting.

Auditing Theory

Quizzer No. 1

7_

56. What best describes the word assurance in the context of the Philippine Standards on
Auditing?
a. Auditors satisfaction as to the reliability of an assertion being made by one party for
use by another party.
b. Level of assurance which may be provided is determined by the reporting objective.
c. Expressed positively in the report.
d. Assurance is of limited in nature.
57. This refers to the audit procedures that, in the auditors judgment and based on the PSAs are
deemed appropriate in the circumstances to achieve the objective of an audit.
a. Analytical procedures.
b. Scope of an audit.
c. Audit sampling.
d. Documentation.
58. Auditing standards differ from auditing procedures in that procedures relate to:
a. Measures of performance
b. Audit principles
c. Acts to be performed
d. Audit judgments
59. Auditing is based on the assumption that financial data and statements are
a. In conformity with GAAP.
b. Verifiable.
c. Presented fairly.
d. Consistently applied.
60. Every CPA professional is required to perform the audit of financial statements according to
PSAs in order to
a. Eliminate audit risk.
b. Eliminate the professional judgment in resolving audit issues.
c. Have a measure of the quality of audit performance.
d. To reduce the audit program to be prepared by the auditor.
61. Which of the following would not represent one of the primary problems that would lead to the
demand for independent audits of a companys financial statements?
a. Management bias in preparing financial statements.
b. The downsizing of business and financial markets.
c. The complexity of transactions affecting financial statements.
d. The remoteness of the users from the organization and thus the inability of the user to
directly obtain financial information from the company.
62. The audit process is
a. A special application of the scientific method of inquiry.
b. Regulated by PICPA.
c. The only service a CPA is allowed to perform by law.
d. Performed only by CPAs.
63. Which of the following is more difficult to evaluate objectively?
a. Efficiency and effectiveness of operations.
b. Compliance with government regulations.
c. Presentation of financial statements in accordance with generally accepted accounting
principles.
d. All three of the above are equally difficult.
64. An operational audit is designed to
a. Assess the efficiency and effectiveness of managements operating procedures.
b. Assess the presentation of managements financial statements in accordance with
generally accepted accounting principles.
c. Determine whether management has complied with applicable laws and regulations.
d. Determine whether the audit committee of the board of directors is effectively
discharging its responsibility to oversee managements operations.
65. Operational auditing is mainly concerned about:
a. Past protection provided by current internal control.
b. Future improvements for management goals.
c. Verification of fair presentation of financial data.
d. Accuracy of data of financial records.
66. An audit conducted to determine whether an entity is following specific procedures or rules set
down by some higher authority.
a. Operational audit
b. Compliance audit
c. Financial audit
d. Detailed audit

Auditing Theory

Quizzer No. 1

8_

67. Which of the following types of audits are most similar?


a. Operational audits and compliance audits.
b. Independent financial statement audits and operational audits.
c. Compliance audits and independent financial statement audits
d. Internal audits and independent financial statement audits.
68. Internal auditing is an independent appraisal function established within an organization to
examine and evaluate its activities. To that end, internal auditing provides assistance to
a. external auditors
b. management and the board of directors
c. shareholders
d. statutory authorities
69. What is the overall objective of internal auditing?
a. To attest to the efficiency with which resources are used.
b. Ascertain that the cost of internal controls is justified.
c. To ascertain that the financial statements present accurately the financial position,
operating results and changes in cash and stockholders equity.
d. To help members of the organization to effectively discharge their responsibilities.
70. Operational audits generally have been conducted by internal auditors and governmental audit
agencies but may be performed by certified public accountants. A primary purpose of an
operational audit is to provide
a. A means of assurance that internal accounting controls are functioning as planned.
b. A measure of management performance in meeting organizational goals.
c. The results of internal examination of financial and accounting matters to a companys
top level management.
d. Aid to the independent auditor, who is conducting the examination of the financial
statements.
71. In general, internal auditors independence will be greatest when they report directly to the:
a. Financial Vice President
b. Corporate Controller
c. Audit Committee of the Board of Directors
d. Corporate Stockholders
72. Governmental auditing, in addition to including audits of financial statements, often includes
audits of efficiency, effectiveness and
a. Adequacy
b. Evaluation
c. Accuracy
d. Compliance
73. In auditing accounting data, the concern is with
a. Determining whether recorded information properly reflects the economic events that
occurred during the accounting period.
b. Determining if fraud occurred.
c. Determining if taxable income has been calculated correctly.
d. Analyzing the financial information to be sure that it complies with government
requirements.
74. Which of the following pertains to the reliability of evidence?
a. The independence of the source evidence.
b. The experience level of the auditor who obtains the evidence.
c. Whether the audit client uses a manual or computerized accounting system.
d. The quantity of the evidence obtained.
75. Although a CPA does not guarantee his findings, his opinion is nevertheless valuable to various
third parties. The value of the CPAs opinion lies in the fact that
a. he has the qualifications required by law to be a CPA.
b. he is under the supervision of the Professional Regulatory Board of Accountancy.
c. he has gathered sufficient, competent, evidential matter to support his opinion.
d. he has followed generally accepted auditing standards.
76. Which of the following government agencies is not represented to AASC?
a. Commission on Audit (COA)
b. Professional Regulatory Board of Accountancy (PRBOA)
c. Securities and Exchange Commission (SEC)
d. Commission on Higher Education (CHED)

Auditing Theory

Quizzer No. 1

9_

77. Which of statement is incorrect regarding the pronouncement of AASC?


a. The pronouncements of the AASC on auditing standards, practices and procedures
shall be in the form of PSA, Interpretations and IAPS.
b. An auditor may judge it necessary to depart from a PSA in order to more effectively
achieve the objective of an audit.
c. The Interpretations will have the same authority as the PSAs.
d. PAPSs are not intended to have the authority of the Interpretations.
78. It refers to the level of satisfaction as to the reliability of an assertion being made by one party
for use by another party
a. confidence level
b. assurance level
c. reasonableness level
d. tolerable level
79. Who is responsible for forming and expressing an opinion on financial statements?
a. Auditor
b. Management
c. Public
d. External Users
80. The expertise that distinguishes auditors from accountants is in the
a. Ability to interpret generally accepted accounting principles.
b. Requirement to possess education beyond the Bachelors degree.
c. Accumulation and interpretation of evidence.
d. Ability to interpret PAS.
81. Unlike consulting services, assurance services
a. Confirm that financial statement assertions are accurate.
b. Competing interests may exist between management and users of statements.
c. Misstated account balances are generally corrected by an independent audit.
d. Ineffective internal controls may exist.
82. Which of the following are considered consulting services?

a.
b.
c.
d.

Advisory services
No
Yes
Yes
Yes

Transactions services
Yes
Yes
No
Yes

Assurance services
No
No
Yes
Yes

83. The market for auditing services is driven by


a. The regulatory authority of the Securities and Exchange Commission.
b. A demand by external users of financial statements.
c. Pronouncements issued by the Auditing Standards and Practices Council.
d. Congress at the national level.
84. Which of the following is a correct statement relating to the theoretical framework of auditing?
a. The financial data to be audited can be verified.
b. Short-term conflicts do not exist between managers who prepare data and auditors
who examine data.
c. Auditors do not necessarily need independence.
d. An audit is of benefit only to the owners.
85. The most important procedure performed in a review is
a. a test of controls
b. obtaining a letter of representation from management
c. inquiry
d. independent confirmation
86. Which is incorrect regarding the pronouncement of AASC?
a. The PSAs and Interpretations may also have application, as appropriate, to other
related activities of the auditors.
b. PSAs contain basic principles and essential procedures (identified in bold type black
lettering) together with related guidance in the form of explanatory and other material.
c. PSAs need only be applied to material matters.
d. The Interpretations have the same authority as the PAPSs.

Auditing Theory

Quizzer No. 1

10_

87. First Statement Interpretations to PSAs will have the same authority as the PSAs.
Second Statement PAPS should also have the same authority as the PSAs.
a.
b.
c.
d.

Both statements are False


Both statements are True
First statement is True; Second Statement is False
First statement is False; Second Statement is True

88. A public accounting firms primary role in performing nonattest services is to


a. Hedge against declines in the firms audit practice.
b. Establish firm as a consultant.
c. Provide advice valuable to the clients effectiveness.
d. Acclimate staff members to the clients business and industry.
89. Which of the following is not represented in the Auditing and Assurance Standards Council?
a. Board of Accountancy
b. Bangko Sentral ng Pilipinas
c. Bureau of Internal Revenue
d. Securities and Exchange Commission
90. Which of the following usually need not be exposed for comments?
a. PSAs.
b. PAPSs.
c. Interpretations.
d. All should usually be exposed.
91. The exposure period allowed for each exposure draft of PSA to be considered by the
organizations and persons to whom it is sent for comment is generally
a. Four months
b. Three months
c. Two months
d. Six months
92. To emphasize auditor independence from management, many corporations follow the practice
of
a. Appointing a partner of the CPA firm conducting the examination to the corporations
audit.
b. Establishing a policy of discouraging social contact between employees of the
corporation and the staff of the independent auditor.
c. Requesting that a representative of the independent auditor be on hand at the annual
stockholders meeting.
d. Having the independent auditor report to an audit committee of outside members of the
board of directors.
93. Independent auditors of financial statements perform audits that reduce and control
a. The business risks faced by investors.
b. The information risk faced by investors.
c. The complexity of financial statements.
d. Quality reviews performed by other CPA firms.
94. Which of the following is an example of an assertion made by management in an entitys
financial statements?
a. The financial statements were prepared in an unbiased manner.
b. Reported inventory balances reflect all related transactions for the period.
c. Reported accounts receivable do not include any uncollectible accounts.
d. The scope of the auditors investigation was not limited in any way by management.
95. The main way (s) to reduce information risk is to have
a. The user verify the information.
b. The user share the information risk with management.
c. Audited financial statements provided.
d. All of the above.
96. Professional skepticism dictates that when management makes a statement to the auditors, the
auditors should
a. Disregard the statement because it ranks low of the evidence quality scale.
b. Corroborate the evidence with other supporting documentation whenever possible.
c. Require that the statement be put in writing. Believe that the statement in order to
maintain the professional client-auditor relationship.

Auditing Theory

Quizzer No. 1

11_

97. Because an external auditor is paid a fee by a client company, he


a. Is absolutely independent and may conduct an audit.
b. May be sufficiently independent to conduct an audit.
c. Is never considered to be independent.
d. Must receive approval of the Securities and Exchange Commission before conducting
an audit.
98. Which of the following is a cause of information risk?
a. Voluminous data.
b. Business and motives of the provider of information.
c. Remoteness of the information.
d. Each of the above is a cause of information risk.
99. Generally accepted auditing standards (GAAS) and Philippine Standards on Auditing (PSAs)
should be looked upon by practitioners as
a. Ideals to work towards, but which are not achievable.
b. Maximum standards which denote excellent work.
c. Minimum standards of performance which must be achieved on each engagement.
d. Benchmarks to be used on all audits, reviews and compilations.
100. Every independent audit engagement involves both auditing standards and auditing
procedures. The relationship between the two may be illustrated by how they apply from
engagement to engagement. The best representation of this application is that, from one
audit engagement to the next,
a. Both auditing standards and auditing procedures are applied uniformly.
b. Auditing standards are applied uniformly but auditing procedures may vary.
c. Auditing standards may vary but auditing procedures are applied uniformly.
d. Auditing standards are applied uniformly but auditing procedures are optional.

*************************