[jeff]

Free Study Planner, Notes, Audio, Flashcards: https://www.another71.com/cpa-exam-study-plan/

Free CPA Exam Survival Guide: https://www.another71.com/cpa-exam-survival-guide/

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

[Iggy1985]

I did take the practice exam, it was helpful. This is my first time taking AUD, I've only taken FAR so far, once thankfully 😀

I think the format is just easier on the exam because there's less material there, like the access gives you all the fasb stuff as well as audit stuff, so you have to dig through more. Also the table of contents disappears when you click on a section, and I don't think it will do that on the exam. I'm mostly comparing to FAR and how it's presented on Wiley test bank. But otherwise it's the same content so I think it helps.

I don't think it will impact you because it's based on your section ID, so I'd imagine you get access for each unique section ID.

FAR - 89 (8/19/14) Wiley TB, Wiley Book, Books from School, Ninja Audio/Notes
AUD - 92 (10/14/14) Wiley TB, Wiley Book, Ninja Audio
BEC - 82 (5/8/15) Mostly Ninja MCQ, sprinkles of Becker lectures and Ninja Audio
REG - (8/14/15)

[Anonymous]

On to impairing auditor's independence.

If close releative has direct financial interest that is NOT matetial, that would still impair auditor's independence? If they hold a key position it will be imparied, but if your spouse or dependent child holds ANY position, will independence still be impaired?

[Iggy1985]

@cpahopeful

a relative's direct financial interest is an indirect financial interest to the CPA. Indirect financial interests that are not material do not affect independence. If it were a material interest by the relative (specifically over 5% of shares), and the CPA knew about it, it would affect independence.

Only key positions affect independence, if a relative was say, a bookkeeper, it wouldn't affect independence of the CPA.

key positions include officer, director, promoter, underwriter, voting trustee, or trustee for a pension or profit sharing trust of the client

FAR - 89 (8/19/14) Wiley TB, Wiley Book, Books from School, Ninja Audio/Notes
AUD - 92 (10/14/14) Wiley TB, Wiley Book, Ninja Audio
BEC - 82 (5/8/15) Mostly Ninja MCQ, sprinkles of Becker lectures and Ninja Audio
REG - (8/14/15)

[Anonymous]

Ah thanks, not a difficult topic but some what tricky.

Also, SSARS does not allow preparation of adjustments or depreciation entries, but for an audit it is okay to do that as long as the auditor doesn't have final responsibility?

[Fk]

@Iggy1985, thanks got it.

[Iggy1985]

@cpahopeful hmm..

I THINK the auditor can propose entries but not make them.. having difficulty finding that answer myself lol

FAR - 89 (8/19/14) Wiley TB, Wiley Book, Books from School, Ninja Audio/Notes
AUD - 92 (10/14/14) Wiley TB, Wiley Book, Ninja Audio
BEC - 82 (5/8/15) Mostly Ninja MCQ, sprinkles of Becker lectures and Ninja Audio
REG - (8/14/15)

[LilEngineThatCan]

Hey, Im going through questions…Earlier someone posted a question about fees and billings. I came across another questions that helped point out something i overlooked..i hope it makes sense.

An understanding with the client MOST LIKELY would:

A identify specific internal control activities that are likely to prevent fraud.

B evaluate the reasonableness of the client's accounting estimates.

ANSWER C: discuss fees and billings.

D inquire of the client's attorney as to whether any unrecorded claims are probable of assertion.

AU-C 210.A23 includes other items which may be included, if applicable, BUT ARE NOT required in an engagement letter. These other items might include:

A. arrangements regarding fees and billings.

B. additional services to be provided relating to regulatory requirements.

C. conditions under which access to audit documentation may be granted to others.

ANSWER D. All of the answer choices listed are correct.

The comparison/relation:

Fee arrangements, expected client assistance, and additional services included in the engagement MAY (not required) all be included in the engagement letter.

MAY be included in the understanding of the engagement letter

So may and most likely…

[Fk]

@lil Enginethatcan , an understanding with the client is done before the cpa enters into client office all the choice a ,b and d are done later on in the audit. A and B is done during the planning stage . d is done during the evidence stage.

[Iggy1985]

yea, what fayas said. the key word is understanding WITH the client (meaning the auditor and the client are making an agreement on something), you usually work out the fees beforehand / hourly rates and can put them in the engagement letter, the other stuff is later in the audit and isn't something you need to come to an understanding with the client on

Here's a Wiley question that stumped me

Which of the following factors is most relevant when an auditor considers the client’s organizational structure in the context of control risk?

A. Management’s attitude toward information processing and accounting departments.

B. The organization’s recruiting and hiring practices.

C. Physical proximity of the accounting function to upper management.

D. The suitability of the client’s lines of reporting.

FAR - 89 (8/19/14) Wiley TB, Wiley Book, Books from School, Ninja Audio/Notes
AUD - 92 (10/14/14) Wiley TB, Wiley Book, Ninja Audio
BEC - 82 (5/8/15) Mostly Ninja MCQ, sprinkles of Becker lectures and Ninja Audio
REG - (8/14/15)

[Future Ninja]

@iggy – is it D? key word: organizational structure = lines of reporting

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Iggy1985]

Yeah it's D, I picked A because I was thinking attitudes/tone at the top is part of organizational structure that is part of control risk >_>

Their only explanation for D was “This answer is correct because proper lines of reporting are necessary to prepare financial statement that follow GAAP. “

FAR - 89 (8/19/14) Wiley TB, Wiley Book, Books from School, Ninja Audio/Notes
AUD - 92 (10/14/14) Wiley TB, Wiley Book, Ninja Audio
BEC - 82 (5/8/15) Mostly Ninja MCQ, sprinkles of Becker lectures and Ninja Audio
REG - (8/14/15)

[Future Ninja]

If the auditor identifies a significant risk related to fraud involving improper revenue recognition, the auditor may perform all of the following except:

A. confirm contract terms with customers.

B. perform substantive analytical procedures relating to revenue.

C. observe shipment of goods.

D. observe inventory at year-end as agreed upon in the planning stages of the audit.

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Future Ninja]

5:30pm – it's time to knock out some mcqs

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Anonymous]

Iggy, I believe the auditor can make JEs as long as management reviews them and accepts responsibility.

[Anonymous]

Is the answer D Iggy?

[Author]

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