MCQ for CA Final Audit - Chapter 2 AUDIT PLANNING, STRATEGY AND EXECUTION

Sample Multiple Choice Questions (MCQ's) for CA Final - Paper 3 - Advanced Auditing and Professional Ethics - Chapter 2: AUDIT PLANNING, STRATEGY AND EXECUTION - For Practice relevant for May/Nov 23 Examinations

 

Q:1 As per SA 300, the audit plan shall include a description of ____________.              

 

  1. the nature, timing and extent of planned risk assessment procedures, as determined under SA 315.
  2. the nature, timing and extent of planned further audit procedures at the assertion level, as determined under SA 330.
  3. other planned audit procedures that are required to be carried out so that the engagement complies with SAs.
  4. all of the above.

Answer: 4

 

Q:2 The auditor should apply analytical procedures at the planning stage to __________.         

 

  1. assist in understanding the business and in identifying areas of potential risk.
  2. obtain assurance that financial statement account balances do not contain material misstatements.
  3. assist the auditor in assessing that the overall financial statement presentation makes sense based on the audit results and an understanding of the business.
  4. assist the auditor in assessing that all significant fluctuations and other unusual items have been adequately explained.

 

Answer: 1

Q:3 Which of the following is correct?  

 

  1. SA 315 has a purpose to establish standards to form procedures to be followed to have an understanding of the entity and its environment.
  2. Establishing an overall audit strategy that sets the scope, timing and direction of the audit, and that guides the development of the audit plan is prerogative of the management.
  3. Planning is a discrete phase of an audit.
  4. There is no relation between Audit Plans and knowledge of the client's business.

 

Answer: 1

 

Q:4 Which of the following audit staff is most likely to be heavily involved in the planning of the audit, evaluation of the results and determination of the audit opinion?             

 

  1. In-charge auditor
  2. Manager
  3. Partner
  4. Supervisor

 

Answer: 1

 

Q:5 When establishing the overall audit strategy, the auditor shall determine materiality for the __________.              

 

  1. financial statement as a whole.
  2. particular classes of transactions, account balances or disclosures.
  3. both (a) and (b).
  4. either (a) or (b).

 

Answer: 1

 

Q:6 Audit strategy is concerned with designing optimized ________ that seek to achieve the necessary audit assurance at the lower cost within the constraints of the information available.        

 

  1. audit procedures
  2. audit techniques
  3. audit approaches
  4. audit programme

 

Answer: 3

 

Q:7 Process of establishing the overall audit strategy assists the auditor to determine, subject to the completion of the auditor's assessment procedures, such matters as:        

 

  1. Nature, timing and extent of risk assessment procedures.
  2. Nature, timing and extent of substantive procedures.
  3. Management of resources as to engagement team members.
  4. Understanding of terms of audit engagement with the client.

 

Answer: 3

 

Q:8 Auditors may use a strategy-oriented framework, which involves the following steps:         

 

  1. use the comprehensive business knowledge decision frame to develop expectations about key assertions embodied in the overall financial statements.
  2. understand the risks that threaten the client's business objectives.
  3. measure and benchmark process performance.
  4. all of the above.

 

Answer: 4

 

 

CA Final - Paper 3 - Advanced Auditing and Professional Ethics - Chapter 3   

 

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