AUD Study Group Q1 2015 - Page 73

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  • February 23, 2015 at 9:04 pm #650877
    Anonymous
    Inactive

    Yes, I 100% agree that risk assessment is a risk assessment procedure.

    Also, I've never done a “final exam” due to the fact I don't want it to shake my confidence for the real exam. However, I may give in one evening this week and work the questions just to see them. I was unaware until today that the final exams are unseen questions from the normal review process with Becker.

    February 23, 2015 at 9:13 pm #650878
    Martin
    Participant

    ARCPA2B, I think you and CTM have a great chance of passing based on your comments on this thread. I suggest you do at least the MC side of the final exams. I never do the whole exam, I just do the MC since they are harder than the simulations. I do it in sets of 10 to 15. The good thing about these exams is that there is a huge thread of students comparing the becker final exam with actual. If you get a 65 or above, you have great chance of passing according to the statistics. This might boost your confidence before the exam.

    Through God all things can happen!

    “You never fail until you stop trying.”
    ― Albert Einstein
    When I was young, I used to admire intelligent people;as I grow older, I admire kind people.
    “Just keep swimming, just keep swimming.”

    FAR= 72-84
    Audit= 73-82
    BEC= 74-75
    Reg=77

    February 23, 2015 at 9:32 pm #650879
    Anonymous
    Inactive

    I just saw the following question on the Becker Final:

    In assessing control risk, an auditor ordinarily selects from a variety of techniques, including:

    A. Analytical procedures.

    B. Reperformance.

    C. Confirmation.

    D. Verification.

    The correct answer was B. Analycial procedures was incorrect.

    February 23, 2015 at 9:38 pm #650880
    Anonymous
    Inactive

    Martin, how do you do short sets on the Becker final and look at your results without having to go back later and enter your answers in again?

    February 23, 2015 at 9:46 pm #650881
    Martin
    Participant

    I do sets of 10 to 15 and then click end of exam. After that hit review test. When you are done, hit retake exam.

    Through God all things can happen!

    “You never fail until you stop trying.”
    ― Albert Einstein
    When I was young, I used to admire intelligent people;as I grow older, I admire kind people.
    “Just keep swimming, just keep swimming.”

    FAR= 72-84
    Audit= 73-82
    BEC= 74-75
    Reg=77

    February 23, 2015 at 9:48 pm #650882
    Martin
    Participant

    CTM, re performance is part of test of controls,so the answer is correct. Assessing=Testing on this question.

    Through God all things can happen!

    “You never fail until you stop trying.”
    ― Albert Einstein
    When I was young, I used to admire intelligent people;as I grow older, I admire kind people.
    “Just keep swimming, just keep swimming.”

    FAR= 72-84
    Audit= 73-82
    BEC= 74-75
    Reg=77

    February 23, 2015 at 9:56 pm #650883
    Anonymous
    Inactive

    I chose reperformance. I just wanted to note that when testing IC analytic procedures are not used.

    February 23, 2015 at 10:01 pm #650884
    Martin
    Participant

    I have it as RIIO for IC testing. How are you doing with becker's finals? Im doing another set tonight.

    Through God all things can happen!

    “You never fail until you stop trying.”
    ― Albert Einstein
    When I was young, I used to admire intelligent people;as I grow older, I admire kind people.
    “Just keep swimming, just keep swimming.”

    FAR= 72-84
    Audit= 73-82
    BEC= 74-75
    Reg=77

    February 23, 2015 at 10:16 pm #650885
    Anonymous
    Inactive

    If I do the becker final the way you say I have to re-enter all of my answers again. Not fun.

    February 23, 2015 at 11:07 pm #650886
    Martin
    Participant

    The software can grade you on only 15 questions, why would you have to enter them again? I guess you want to do the simulations as well, and you want the software to grade you in everything. I do sets of 15 and put all my scores on excel.

    Through God all things can happen!

    “You never fail until you stop trying.”
    ― Albert Einstein
    When I was young, I used to admire intelligent people;as I grow older, I admire kind people.
    “Just keep swimming, just keep swimming.”

    FAR= 72-84
    Audit= 73-82
    BEC= 74-75
    Reg=77

    February 24, 2015 at 12:07 am #650887
    Martin
    Participant

    I just came across a MC that asks about who establishes materiality with the attorney. I thought it was the Auditor and management,but this one says is the Auditor and the attorney. Which is the correct one?

    Through God all things can happen!

    “You never fail until you stop trying.”
    ― Albert Einstein
    When I was young, I used to admire intelligent people;as I grow older, I admire kind people.
    “Just keep swimming, just keep swimming.”

    FAR= 72-84
    Audit= 73-82
    BEC= 74-75
    Reg=77

    February 24, 2015 at 2:53 am #650888
    swilk
    Member

    @Martin, I think that's just one of those tricky questions, but I could be wrong… It is my understanding that the auditor always establishes materiality and that management should come to an understanding of this, but not help establish it. Regarding the letter of inquiry to the attorney, it states:

    “When a materiality limit has been established based on an understanding between management and the auditor, the following sentence should be added: This request is limited to contingencies amounting to (amount) individually or items involving lesser amounts that exceed (amount) in the aggregate”

    I am not 100% on the facts behind the answer, but by default I think you have to exclude management's involvement in the establishment of materiality, so the answer would be auditor and attorney. The above statement pertains to management's understanding of materiality with the auditor… not establishment.

    AUD - 90 (2.26.2015)
    BEC - 76 (5.4.2015)
    REG - 79 (8.31.2015)
    FAR - 76 (2.22.2016)

    Roger and Ninja MCQ FTW.

    February 24, 2015 at 3:00 am #650889
    swilk
    Member

    Can anyone help me with this MCQ:

    Which of the following statements is correct about an auditor's required communication with those charged with governance?

    A. Any matters communicated to those charged with governance also are required to be communicated to the entity's management.

    B. The auditor is required to inform those charged with governance about significant errors discovered by the auditor and subsequently corrected by management.

    C. Disagreements with management about the application of accounting principles are required to be communicated in writing to those charged with governance.

    D. Weaknesses in internal control previously reported to those charged with governance are required to be communicated to those charged with governance after each subsequent audit until the weaknesses are corrected.

    The correct answer is B, but I thought C was correct. Here was the software's explanation:

    The auditor is required to communicate to those charged with governance certain matters related to the conduct of the audit. The matters to be communicated include:

    • the auditor's responsibility under generally accepted auditing standards,

    • an overview of the planned scope and timing of the audit, and

    • significant findings from the audit, including:

    o the auditor's views about qualitative aspects of the entity's significant accounting practices,

    o significant difficulties encountered during the audit,

    o uncorrected misstatements,

    o disagreements with management,

    o management's consultation with other accountants, and

    o significant issues discussed, or subject to correspondence, with management.

    In the above detail, I noticed it stated “disagreements with management” as a matter, required to be communicated. I guess B is just the better answer? But, why? Is it because even though the errors were corrected by management, they were significant (i.e. material)?

    AUD - 90 (2.26.2015)
    BEC - 76 (5.4.2015)
    REG - 79 (8.31.2015)
    FAR - 76 (2.22.2016)

    Roger and Ninja MCQ FTW.

    February 24, 2015 at 3:35 am #650890
    LKD CPA
    Member

    swilk – I posted about my confusion with this question a few weeks ago. The big point is that choice C says “in writing”. The communication to those charged with governance is not REQUIRED to be in writing. Although it's ideal, it's not mandatory. So, this makes choice B the most correct answer.

    FAR: 74, 83
    REG: 76
    BEC: 77
    AUD: 89

    February 24, 2015 at 3:46 am #650891
    swilk
    Member

    Another one….

    When performing risk assessment procedures to obtain an understanding of internal controls, the auditor may include all of the following except:

    A. observing the application of specific controls.

    B. performing analytical procedures.

    C. inspecting documents and reports.

    D. tracing transactions through information system relevant to financial reporting.

    I answered D, but the correct answer is B.

    The answer was followed by the following statement:

    Risk assessment procedures to obtain audit evidence about the design and implementation of relevant controls may include:

    inquiring of entity personnel.

    observing the application of specific controls.

    inspecting documents and reports.

    tracing transactions through the information system relevant to financial reporting.

    Inquiry alone, however, is not sufficient for such purposes.

    Performing analytical procedures are used for assisting the auditor in planning the nature, timing, and extent of other auditing procedures, as a substantive test to obtain audit evidence, and as an overall review of financial information in the final review stage.”

    I always remembered the risk assessment procedures to obtain an understanding of the entity/envt including its internal control as AIIO:

    A: Analytical Procedures

    I: Inquiries

    I: Inspection

    O: Observation

    The answer explanation above hurts my head hahaha.

    AUD - 90 (2.26.2015)
    BEC - 76 (5.4.2015)
    REG - 79 (8.31.2015)
    FAR - 76 (2.22.2016)

    Roger and Ninja MCQ FTW.

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