11.

Usually, an operational audit is performed

12. Results of compliance audits are typically reported to someone within the organizational unit being audited rather than
to a broad spectrum of outside users. Which of the following audits can be regarded as generally being a compliance
audit?

13. Internal auditing means an independent, objective assurance and consulting activity designed to add value and improve
an organization's operations. Its overall objective is to:

14. To provide for the greatest degree of independence in performing internal auditing functions, an internal auditor most
likely should report to the

15. For an internal auditor to render impartial and unbiased judgments, he or she must be independent of the entity's

a. By independent external auditors.

b. By a team consisting of an equal number of external and internal auditors.
c. Only when an operating division is experiencing declines in productivity or profitability.
d. By internal auditors at the request of top management or the board of directors.
Compliance Audits
a. COA auditor’s evaluation of the computer operations of governmental units.
b. An internal auditor’s review of a company’s payroll authorization procedures.
c. BSP examiners' examinations of banks.
d. A CPA firm’s audit of the local school district.

Internal Audits
a. Attest to the efficiency with which resources are employed.
b. Ascertain that controls are costs-justified.
c. Provide assurance that financial data have been accurately recorded.
d. Assist the members of the organization in the effective discharge of their responsibilities.

a. Financial vice-president.
b. Corporate controller.
c. Those charged with governance.
d. Corporate stockholders.

a. Stockholders.
b. Personnel and operating activities.
c. Independent (external) auditors.
d. Board of directors.
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16. Which of the following audits does governmental auditing encompass?

17. An external auditor is conducting an audit of the financial statements of Camden Corporation under PSAs. The
external auditor is expected to

18. An “integrated audit”, as required by Sarbanes-Oxley Act for U.S. public companies, includes an audit of

19. Which of the following statements about theoretical framework of financial statements auditing is(are) incorrect?

20. Which type of auditor may perform a financial statements audit?

Governmental Audits
a. Financial statements audits
b. Operational audits
c. Compliance audits
d. All of the above

Financial Statements Audits

a. Express an opinion as to the fairness of Camden's financial statements.
b. Express an opinion as to the attractiveness of Camden for investment purposes.
c. Certify to the correctness of Camden's financial statements.
d. Critique the wisdom and legality of Camden's business decisions.
a. The company’s internal controls
b. The company’s financial statements
c. The company’s compliance with its rules and policies
d. Both A and B

I I. The data to be audited can be verified

II II. Long-term conflicts may exist between managers who prepare the data and auditors who examine the data
III III. Auditors act on behalf of management
IV IV. An audit benefits the public
V a. II and III only c. II only
VI b. II, III and IV only d. III only

a. External auditor
b. Internal auditor
c. Governmental auditor
d. Both A and C