Auditing (ACCM4201)
BSc. Accounting - ACC
Semester: Second Semester
Level: 400
Year: 2019
THE UNIVERSITY OF BAMENDA UNIVERS1TE DE BAMENDA
FACULTY OF ECONOMICS AND FACULTE DES SCIENCES
MANAGEMENT SCIENCES (FEMS) ECO. ETDEGESTION
2018/19
2
ND
SEMESTER
EXAMINATIONS
(C.A)
Course:
AUDITING
Level:
400 (Year III)
Duration:
01 Hour
Instruction:
Attempt all the questions.
Instructions: Indicate only the /oiler corresponding to the right answer for each question.
1 Auditing has to report that accounts have been prepared as per GAAP and represent a
A B C D
Correct view of easiness Authentic view of business Accountant s view of True and fair view of
operations operations business operations business operations
2. In the case of financial audit, a set of financial statements are said to be true and fair when they are free of:
A B C D
Error Fraud Material misstatements Accounting Corrections
3. An audit which is compulsory by the law
A) Government audit B) Internal audit
C) Cost audit
D) Statutory audit
4. Audit done by the employees on the business undertaking is called
A) Final audit B) Management audit
C) Government audit D) Company audit
5. Management audit otherwise called as
A) Final audit B) Efficiency audit
C) Cost audit D) Cash audit.
6. A number of checks and controls exercised in a business to ensure its efficient working is known as
A) Internal check B) Internal control.
C) Internal audit D) Interim check
7. Voucher relates to
A) Cash receipt B) Cash payments
C) Credit transactions D) All of the above
8. Internal checks is meant for
A) Prevention of frauds B) Detection of fraud
C) Helping audit is depth. D) Detection of Errors
9. An Internal auditor is appointed by
A) The management B) The share holders
C) Internal rules and regulations D) The statutory body
10. Auditing begins where _________ ends
A) Selling
B) Inventory valuation
C) Accounting
D) Purchases
11. Which of the following is not true about opinion on financial statements?
A) The auditor should express an opinion on financial statements.
B) His opinion is no guarantee to future viability of business
C) He is responsible for detection and prevention of frauds and errors in financial statements
D) He should examine whether recognised accounting principle have been consistently
12. A sale of 500 000 CFAF to A was entered as a sale to B. This is an example of
A) Error of omission
B)
Error of commission
C) Compensating error
D) Error of principle
13. The objective of an audit of financial statements is to enable an auditor to………… on financial statements
A B C D
make a compilation of audit express an opinion check transactions check fraud
14. Which of the following statements is not true
A) Management fraud is more difficult to detect than employee fraud
B) Internal control system reduces the possibility of occurrence of employee fraud and management fraud
C) The auditor’s responsibility for detection and prevention of errors and frauds is similar
D) All statements are correct
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15. Both auditing and accounting are concerned with financial statements Which of the following
A) Auditing uses the theory of evidence to verify the financial information made available by Accountancy
B) Auditing lends credibility dimension and quality dimension to the financial statements prepared by the accountant.
C) Auditor should have through knowledge of accounting concepts and convention to enable him to express an opinion on financial statements
D) All of the above
16. The main object of an audit is
A) Expression of opinion B Detection and Prevention of fraud and error C Both (A) and (B) D Depends on the type of audit
17. As per AAS4 if auditor detects an error then -
A) He should inform the management
B) He should communicate it to the management if it is material
C) The auditor should ensure financial statements are adjusted for detected errors.
D) Both (B) and (C)
18. Who normally appoints the external auditors of a company
A Directors B Shareholders
C Audit committee D The General Manager
19. The authenticity of financial statements is very essential and such authenticity of accounts can be assured with the help of
A B C D
The Accountant Management Company Directors Auditing
20. Who is responsible for the prevention and detection of fraud within an organisation?
A. External auditors
B. Directors
C. internal auditors
21. Much of the following are recognised threats to independence and objectivity as identified m Auditors Code of Ethics and Conduct?
(1) Familiarity (2) Self-interest (3) Integrity (4) Advocacy
A 1, 2, 3 and 4
B 1, 2 and 4
C 2
3 and 4
D 2 and 4 only
22 Winch of the following is the correct definition of 'integrity
1
in accordance with Auditors Code of ethics and Conduct?
A Members should not allow bias conflicts of interest or undue influence of others to override professional or business judgment
B Members should act diligently and in accordance with applicable technical and professional standards when providing professional services
C Members should comply with relevant laws and regulations and should avoid any action that discredits the profession
D Members should be straightforward and honest in all business and professional relationships
23. The concept of stewardship means that a company’s director ……………………………… ?
A. Are responsible for ensuring that the company complies with the law
B. Are responsible for ensuring that the company pays its tax by the due date
C. Safeguard the company’s assets and manage them on behalf of the shareholders
D. Report suspected fraud and money laundering to the authorities
24. Why do auditors concentrate then efforts on material items in accounts
A Because they are easier to audit
B Because it reduces the audit time
C Because the risk to the accounts of then being incorrectly stated is greater
D Because the directors have asked for it
25. Who is responsible for maintenance of accounts
A B C D
Auditing Accounting Both, A & B Management
26. An auditor is like a …………………………..?
A Blood haunt B Watch dog
C May be both according to situation D None of these
27. The process by which criminals try to make the proceeds of their crimes appear 'clean' is known as
7
A Benefit of criminal conduct B Money laundry
C Whistle blowing. D legal defence
28. The threshold value of equipment and tool to be reported as capital expenditure according to the Cameroon tax law is
A Material value B Non material value
C 400 000 CFAF D 500 000 CFAF
29. The release of unpublished sensitive price information to a stock-broker friend by an Auditor is known as
A Benefit of information B Information laundry C Whistle blowing D Insider dealing
30. The relationship where one person has a duty of care towards someone else is known as
A Agency relationship B Stakeholder relationship
D Caretaking relationship D Fiduciary relationship
31. The rule of professional conduct winch
requires
that .information acquired in the course of professional work should not be disclosed except
where consent have been obtained from the client is known as
A Professional secrecy B Insider dealing C Integrity D Confidentiality
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