AUD Study Group Q2 2015 - Page 14

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    Topic
  • March 5, 2015 at 8:09 pm #192520
    jeff
    Keymaster

    Welcome to the Q2 2015 CPA Exam Study Group for AUD.

    World Premier: “Unmodified” (Audit Reports Rap Video) 🙂

    Posted by Another71 on Thursday, November 13, 2014

    Free NINJA: https://www.another71.com/cpa-exam-study-plan/

    Jeff Elliott, CPA (KS) | Another71 | NINJA CPA | NINJA CMA | NINJA CPE

Viewing 15 replies - 196 through 210 (of 1,631 total)
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  • March 15, 2015 at 4:30 pm #668542
    trish_1234
    Member

    Ola 🙂

    AUD 69, 92 7/15 Gleim and Ninja test bank
    FAR sometime in 10/15 Gleim
    BEC not taken
    REG not taken

    March 15, 2015 at 4:34 pm #668543
    ladybossxo
    Participant

    Hello Trish!! D is correct!!

    Explanation:

    AU-C 520.A7 states:

    The auditor's substantive procedures to address the assessed risk of material misstatement for relevant assertions may be tests of details, substantive analytical procedures, or a combination of both. The decision about which audit procedures to perform, including whether to use substantive analytical procedures, is based on the auditor's professional judgment about the expected effectiveness and efficiency of the available audit procedures to reduce the assessed risk of material misstatement to an acceptably low level.

    CPA Exams Done.

    March 15, 2015 at 4:35 pm #668544
    ladybossxo
    Participant

    @Trish! I am working on a few ratio questions now and I am thinking of you… 😛

    CPA Exams Done.

    March 15, 2015 at 4:35 pm #668545
    oceansister
    Member

    d ?

    March 15, 2015 at 4:36 pm #668546
    oceansister
    Member

    i am late with the answer 🙂 need to learn to refresh the page 🙂

    March 15, 2015 at 4:42 pm #668547
    Anonymous
    Inactive

    2 Questions:

    What do I need to know about Materiality in terms of ISA?

    Is sampling considered a substantive procedure? And at what stage of the audit do we perform sampling?

    March 15, 2015 at 4:45 pm #668548
    trish_1234
    Member

    LOL!! ill go to that section too

    AUD 69, 92 7/15 Gleim and Ninja test bank
    FAR sometime in 10/15 Gleim
    BEC not taken
    REG not taken

    March 15, 2015 at 4:49 pm #668549
    ladybossxo
    Participant

    @CFO I can try to answer your question regarding sampling. There are two types of sampling: 1) attribute sampling and 2) variables sampling.

    Attribute sampling is used for testing internal controls and variables sampling is used in substantive testing of account balances.

    CPA Exams Done.

    March 15, 2015 at 4:50 pm #668550
    ladybossxo
    Participant

    Lol oceansister! You're correct!! You've been doing well with all these questions!

    CPA Exams Done.

    March 15, 2015 at 4:59 pm #668551
    Anonymous
    Inactive

    Right. But is Sampling considered an actual “substantive test” or is it a precursor to “substantive testing”?

    March 15, 2015 at 5:04 pm #668552
    trish_1234
    Member

    CFO

    Auditor first obtains an understanding of the entity and its environment including internal control to identify and assess the risk of material misstatement of the financial statements whether de to fraud or error. Once the Auditor assesses the risk He may or may not rely on control …

    If he decides to rely on controls he tests controls (accelerated filers has to report on controls)

    then he tests accts some accounts

    A lot of judgement goes into it

    effective internal controls reduces risk so we have to consider controls

    AUD 69, 92 7/15 Gleim and Ninja test bank
    FAR sometime in 10/15 Gleim
    BEC not taken
    REG not taken

    March 15, 2015 at 5:05 pm #668553
    trish_1234
    Member

    sampling is a substantive test

    AUD 69, 92 7/15 Gleim and Ninja test bank
    FAR sometime in 10/15 Gleim
    BEC not taken
    REG not taken

    March 15, 2015 at 5:10 pm #668554
    ladybossxo
    Participant

    @CFO I think sampling is both a test of control and substantive test though. You were asking at what stage do you perform audit sampling. Audit sampling is used in vouching, confirming, and tracing, but it is ordinarily not used in inquiring, observing, and analytical procedures. So I guess it depends on what you're trying to test :S

    CPA Exams Done.

    March 15, 2015 at 5:11 pm #668555
    trish_1234
    Member

    Affective controls relevant to the efficiency of purchases will result in proper evaluation of the time for ordering merchandise. When making this evaluation, the purchasing company should give primary consideration to

    A. The borrowing cost of money (interest) that the company must incur as a consequence of acquiring the merchandise.

    B. The flow of funds within the company that indicates when money is available to pay for merchandise.

    C. The trade-off between the cost of owning and storing excess merchandise and the risk of loss by not having merchandise on hand.

    D. The price differences that exist among various vendors who can supply the merchandise at the required time.

    AUD 69, 92 7/15 Gleim and Ninja test bank
    FAR sometime in 10/15 Gleim
    BEC not taken
    REG not taken

    March 15, 2015 at 5:18 pm #668556
    ladybossxo
    Participant

    @Trish: Lol we both know I am not good in questions like these, I am saying D… :S

    CPA Exams Done.

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