[jeff]

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/

[trish_1234]

A, D, D, No No should be basis for qualified opinion paragraph

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

[trish_1234]

I think the posting thingy is resolved now lol

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

[ahugemistake]

You got them all trish! I can't figure out how to keep the 2nd one straight. So when it's an attest engagement you would include a paragraph describing the inherent limitations of the structure, otherwise its D. So I guess in an attest engagement you wouldn't restrict the distribution?

FAR - 78*
AUD - 66, 79
REG - 73, 76
BEC - 79

[Anonymous]

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our Qualified opinion.

Wouldn't that be in the Auditor's responsibility paragraph?

[Anonymous]

Integrated audits you don't restrict

[Anonymous]

@lavendersky

The answers for the “Risk” simulation were:

1. Inherent Risk – Inherent risk is the susceptibility of an assertion to material statement assuming that there are no related controls. Assertions involving complex calculations have relatively high inherent risk.

2. Fraud risk – Fraud Risk is the risk of material misstatements due to fraud. The auditor is required to evaluate fraud risk, and must consider whether and to what extend fraud risk factors (incentives/pressures, opportunity and rationalization/attitude) exist. Anticipated future layoffs create a fraud risk in that they sometimes provide an incentive for employees to misappropriate assets.

3. Audit Risk – Audit Risk is the risk that the auditor may unknowingly fail to appropriately modify the opinion on the financial statements that are materially misstated. In this case, the auditors did not know that sales were materially overstated and therefore failed to appropriately modify the opinion.

4. Risk of Incorrect Rejection – The Risk of Incorrect Rejection is the risk that a sample mistakenly indicates a material misstatement in an account balance when in fact such balance is fairly stated. In this example, The auditor erroneously assumes, based on the sample, that dividend income is materially understated. In other words, The auditor will mistakenly reject a properly stated account balance.

5. Detection Risk – Detection Risk is the risk that the auditor will not detect a material misstatement that exists in an assertion. Detection Risk generally related to the auditor's procedures. In this case, the auditor relied too heavily on internal evidence and therefore did not detect an error in the existence assertion for cash. (Note that a more effective procedure such as examining the bank statement or obtaining a confirmation from the bank, would have identified this problem).

6. Risk of Assessing Control Risk Too Low – is the risk that the sample indicates a lower error rate than actually exists in the population at large. In this case, The auditor has mistakenly assumed that invoices throughout the year are properly approved, when in fact this control was not operating during the last three quarters of the year. The auditor's sample is not representative of the population and therefore The auditor will make an erroneous decision.

7. Detection Risk – Detection Risk is the risk that the auditor will not detect a material misstatement that exists in an assertion. Detection Risk generally related to the auditor's procedures. In this case, the auditors focused their attention on interim testing and did not appropriately address the incremental risk between interim and year-end.

8. Fraud risk – Fraud Risk is the risk of material misstatements due to fraud. The auditor is required to evaluate fraud risk, and must consider whether and to what extend fraud risk factors (incentives/pressures, opportunity and rationalization/attitude) exist. Management compensation contingent on achieving financial targets creates a fraud risk in that it sometimes provides an incentive for management to intentionally misstate or omit financial statement amounts or disclosures.

9. Risk of Assessing Control Risk Too High – is the risk that the sample indicates a greater error rate that actually exist in the population at large. In this case, based on the selected sample The auditor believes that this control is not operating effectively. In fact, appropriate credit approval are being obtained.

10. Control Risk – is the risk that a material misstatement that could occur in an assertion will not be prevented or detected on a timely basis by the entity's internal control. In this case, the company's purchasing function lacks the controls that would prevent or detect errors.

I did not do well on this one either. I did only find 50%

[Anonymous]

@CPAbefore40, I did not do well on that one either. Got 45%! Some of them were very tricky!

[trish_1234]

@hugemistake. that question on control is worded weird…they are talking about communication of significant weaknesses of IC to those charge in Gov. (IS that the question you are referring to? 2nd?) the communication is restricted. I believe the inherent limitations does not go into this discussion (I will look at my book again)…the inherent limitations of an audit goes into the audit report and engagement letter.

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

[lavendersky]

@CPAbefore40 Thank you so much!! Did becker show these answers after you took it? I just want to make sure that there's no technical difficulties in mine cause no answers or explanation was given for only this question. I only got 60% on this one. I did the worst in tickmarks :/

I thought 3 & 5 would be risk of assessing control risk too low… oh wells. I guess after reading the explanation it sorta make sense

FAR- PASSED
AUD- PASSED
REG- PASSED
BEC-

You got to do what you have to do!

[trish_1234]

@ egiorgi yes at the end of audit responsibility paragraph

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

[Anonymous]

@lavendersky

Yes, you should be able to see the answers after you take the exam if your program is working correctly. If you click on the “Exam 1” tab it should take you to the results summary page. If you click the “Review” icon, you should be able to go through all the questions of the exam with their respective explanations including SIMs.

I hear you. I did not know any of the tick marks!! Seriously, where can you learn those??!!

How did you do with Exam 2? I worked some Becker MCQs ranging in the low 80s and was feeling ok. Then tried some Ninja ones and scored 50%!! I never had this large fluctuation in scores when studying for FAR. I am feeling very unprepared about this one 🙁

That being said, I am hoping it will not be very busy tomorrow at work so I can continue listening to Ninja Audio during the day. I am planning to continue with more MCQs tomorrow night.

For everyone testing this coming week, what is your plan of attack? 🙂

[Anonymous]

@ trish.

So if it is at the end of the auditors responsibility paragraph, why is that answer no-no? What am I missing? Is it because they are asking about the reference to the specific situation?

@cpabefore40 My plan of attack is to pass or die trying. I'm so exhausted now and I'm basically running on fear. Ninja MCQS are kicking my butt the further I get into them. I can't even think about SIMS or practice tests until I get them down. I went back to Becker and got a 100% on a 30 pt progress test. Only to go back to ninja and get a 78 on a hundred point test.

[lavendersky]

@CPAbefore40 alright… obviously, there is smthg wrong with my program of not getting the explanation for that stimulation then. Need to consult becker about that.

Because of unexpected things that happen today, I was not able to take the 2nd practice exam as planned. So annoyed that I wasn't able to do what I planned. Since I have no time at all today, I'm going to have to take it tmrw. I'll let you know how it goes. Only have a couple days left so I'm getting so nervous!

At this point, just do the best you can. Keep reviewing materials you can't memorize; Keep practicing the MCques and progress test!

FAR- PASSED
AUD- PASSED
REG- PASSED
BEC-

You got to do what you have to do!

[ImANervousWreck]

Hi All,

I'm just going over the SIMs and have a question on the Becker SIM for A-1 #3. The question asks: “An entity has changed its depreciation method for production equipment from the straight-line method to a units-of-production method based on hours of utilization. The entity's auditor concurs with the change although it has a material effect on the comparability of the entity's F/S.

From the following opinion types, select those which can be used by clicking the box beside the option. up to TWO OPINION TYPES by be selected.”

My main question is that it says up to TWO OPINION TYPES, so, I only choose Unmodified but how come all 4 are correct? Is this a trick? For those that have already taken the AUD exam, will there be similar questions like this? I don't want to only pick up to two when ALL four are correct.

Any help/comments are appreciated. Thanks!

REG - 05/14/2015 - "W"?
AUD - 05/27/2015
BEC - 07/16/2015
FAR - 08/29/2015

[trish_1234]

@doover for our convenience I am copying and pasting the question below… So Doover this question is one of those that one word changes everything 🙂

The question asks “an auditor should refer to the situation” The auditor does not refer to the situation in the auditors responsibility it states the opinion expressed. The report refers to the situation (think of it as describes the situation) in the basis for qualified opinion paragraph.

Does this help?

When qualifying an opinion because of an insufficiency of audit evidence, an auditor should refer to the situation in the

Auditor's Responsibility section Notes to the financial statements

Yes Yes

Yes No

No Yes

No No

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

[Author]

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