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Auditing Vocab

Subject : business-skills
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Existing condition or set of circumstances involving uncertainty about a possible loss that will ultimately be resolved when some future event occurs or fails to occur.






2. Statements issued by the AICPA Auditing Standards Boards - considered as interpretations of the 10 GAAS statements.






3. A violation of laws or governmental regulations.






4. The risk that material misstatements that could occur will not be prevented - or detected and corrected - by internal controls.






5. A process designed by - or under the supervision of - the company's principal executive and principal financial officers - or persons performing similar functions - and effected by the company's board of directors - management - and other personnel -






6. The amount of misstatement that the auditor believes exists in the population.






7. Attribute sampling techniques used to estimate the dollar amount of misstatement for a class of transactions or an account balance.






8. The end product of the auditor's work indicating the auditing standards followed - and expressing an opinion as to whether an entity's financial statements are fairly presented in accordance with agreed-upon criteria (eg. GAAP)






9. Audit sampling that relies on the auditor's judgment to dewtermine the sample size - select the sample - and/or evaluate the results for the purpose of reaching a conclusion about the population.






10. Intentional misstatements that can be classified as fraudulent financial reporting and/or misappropriation of assets.






11. When a subsequent event disclosed in the financial statements occurs after the date of the report but before the issuance of the related financial statements - the auditor may use dual dating. The auditor may use the original date of the report excep






12. Basic unit containing the elements of the population to be sampled






13. The application of an audit procedure to less than 100 percent of the items within an account or class of transactions for the purpose of evaluating some characteristic of the balance or class.






14. Evaluations of financial information made by a study of plausible relationships among both financial and nonfinancial data.






15. A deficiency - or a combination of deficiencies - in internal control that is less severe than a material weakness - yet important enough to merit attention by those charged with governance.






16. Business transactions between individuals and organizations that occur without paper documents - using computers and telecommunication networks.






17. Risks resulting from significant conditions - events - circumstances - and actions or inactions that could adversely affect management's ability to execute its strategies and to achieve its objectives - or through the setting of inappropriate objecti






18. The auditor's opinion that the financial statements present fairly - in all material respects - in accordance with generally accepted accounting principles (or other comprehensive basis of accounting) - except for a material misstatement that does no






19. The auditor's independent execution of procedures or controls that were originally performed as part of other entity's internal control - either manually or through the use of CAATs.






20. The risk that the sample supports the conclusion that the recorded account balance is materially misstated when it is not materially misstated.






21. Violations of laws or government regulations.






22. A range of acceptable amounts or a precisely determined point estimate for an estimate (eg. uncollectible receivables) - if that is a better estimate than any other amount






23. The transmission of business transactions over telecommunication networks.






24. Evaluations of financial information made by a study of plausible relationships among both financial and nonfinancial data






25. Specific acts performed by the auditor in gathering evidence to determine if specific assertions are met.






26. The risk that the sample supports the conclusion that the control is operating effectively when it is not or that the recorded account balance is not materially misstated when it is materially misstated.






27. The risk that the sample supports the conclusion that the control is not operating effectively when it actually is or that the recorded account balance is materially misstated when it is not materially misstated.






28. A measure of sampling risk added and subtracted to the projected misstatement to form a confidence interval.






29. An organization created to provide professional accounting-related services - including auditing. Usually formed as a proprietorship or as a form of partnership.






30. Consulting services that may provide advice and assistance concerning an entity's organization - personnel - finances - operations - systems - or other activities






31. The probability that the true but unknown measure of the characteristic of interest is within specified limits.






32. The possibility that the auditor may use inappropriate audit procedures - fail to detect a misstatement when applying an audit procedure - or misinterpret an audit result.






33. The risk that the auditor is exposed to financial loss or damage to his or her professional reputation from litigation - adverse publicity - or other events arising in connection wit financial statements audited and reported on.






34. The auditor's opinion that the financial statements present fairly - in all material respects - in accordance with generally accepted accounting principles (or other comprehensive basis of accounting)-i.e. - a clean opinion.






35. The risk that the auditor may unknowingly fail to appropriately modify his or her opinion on financial statements that are materially misstated.






36. A confirmation request to which the recipient responds whether or not he or she agrees with the amount or information stated.






37. Audit evidence that includes minutes of meetings; confirmations from third parties; industry analysts' reports; comparable data about competitors (benchmarking); controls manuals; information obtained by the auditor from such audit procedures as inqu






38. The auditor's plan for the expected conduct - organization - and staffing of the audit.






39. Substantive tests that concentrate on the details of items contained in the account balance and disclosures.






40. The risk that the sample supports the conclusion that the control is operating effectively when it is not or that the recorded account balance is not materially misstated when it is materially misstated.






41. Financial statements prepared under regulatory - tax - cash basis - or other definitive criteria having substantial support.






42. The risk that the auditor will not detect a material misstatement that exists in the financial statements






43. Business transactions between individuals and organizations that occur without proper documents - using computers - and telecommunication networks.






44. Computer programs that allow auditors to test computer files and databases.






45. Controls that relate to the overall information processing environment and have a pervasive effect on the entity's computer operations.






46. The uncertainty that results from sampling; the difference between the expected mean of the population and the tolerable deviation or misstatement.






47. Sampling used to estimate the proportion of a population that possesses a specified characteristic.






48. The policies and procedures that help ensure that management's directives are carried out.






49. The application of an audit procedure to less than 100 percent of the items within an account or class of transactions for the purpose of evaluating some characteristic of the balance or class.






50. An audit of both financial statements and internal control over financial reporting - provided by the external auditor. Required for public companies.






Can you answer 50 questions in 15 minutes?



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