Auditing - Chapter 6 Audit Responsibilities and Objectives Practice

Auditing and Assurance Services, 15e (Arens)

Chapter 6 Audit Responsibilities and Objectives

Learning Objective 6-1

1) The objective of an audit of the financial statements is an expression of an opinion on:

A) the fairness of the financial statements in all material respects.

B) the accuracy of the financial statements.

C) the accuracy of the annual report.

D) the accuracy of the balance sheet and income statement.

Answer: A

Terms: Objective of ordinary audit of financial statements

Diff: Easy

Objective: LO 6-1

AACSB: Reflective thinking skills

3) Auditors accumulate evidence to:

A) defend themselves in the event of a lawsuit.

B) determine if the financial statements are correct.

C) satisfy the requirements of the Securities Acts of 1933 and 1934.

D) reach a conclusion about the fairness of the financial statements.

Answer: D

Terms: Auditors accumulate evidence

Diff: Easy

Objective: LO 6-1

AACSB: Reflective thinking skills

Learning Objective 6-2

1) The responsibility for adopting sound accounting policies and maintaining adequate internal control rests with the:

A) board of directors.

B) company management.

C) financial statement auditor.

D) company's internal audit department.

Answer: B

Terms: Responsibility for adopting sound accounting policies and maintaining adequate internal controls

Diff: Easy

Objective: LO 6-2

AACSB: Reflective thinking skills

3) In certifying their annual financial statements, the CEO and CFO of a public company certify that the financial statements comply with the requirements of:

A) GAAP.

B) the Sarbanes-Oxley Act.

C) the Securities Exchange Act of 1934.

D) GAAS.

Answer: C

Terms: Certifying annual financial statements by CEO and CFO

Diff: Easy

Objective: LO 6-2

AACSB: Reflective thinking skills

Topic: Public

5) The responsibility for the preparation of the financial statements and the accompanying footnotes belongs to:

A) the auditor.

B) management....