AAA1-Chapter 3

There are a lot of reasons which affect to the assurance engagement quality. Which TWO of the following reasons affect to assurance engagement quality?

• The superivisor of assurance engagement may fail to communicate the issues arising to the engagement partner

• The auditor may perform the right work to an adequate standard

• The client could be negligent

• The chief accountant of a company which is a supplier of audited entity could be incompetent

• The auditor may not have adequate understanding of the client’s business

Quality controls are…..adopted by Certified Public Accountants to provide reasonable assurance of   conforming to professional standards in performing audit and related services

Reasons affecting to audit quality could come from which of the following parties?

• Client

• Individual auditor

• Third party

• Related party

• Audit engagement partner

Which of the followings is/are NOT quality control actions/procedures in engagement performance phase

• Reperformance

• direction

• supervision

• Review

• Consultant

Who is responsible for direction of engagement performance?

• Members of audit committee of audited entity

• Board of director of the audited entity

• Board of management of the audited entity

• Engagement partner

• Auditor and auditor assistant

Which of the following statements is false relating to review actions in the audit firm

• The review will help to assess the sufficiency and appropriateness of obtained audit evidence

• The review is the obligatory procedure according to law and regulations

• Engagement quality control review (EQCR) is performed by engagement partner

• A ‘hot review’ is a review carried out by a partner not otherwise involved in the engagement or an external consultant

• Engagement quality control review (EQCR) is performed by a suitably qualified partner or other person in the firm not otherwise involved in the engagement

Which of the following is the quality control procedure of audit firms

• Reperform the control activities of audited entity which auditor suspected that they are ineffective

• All work performed by junior staffs must be review by a higher-level staff

• Observe the business operations of audited entity and assess the risk

• Allocate experienced and competent staff to the engagement

• Inquiry the employees of audited entity about the reasons of figures differences

How many elements of an audit quality control system?

• 4

• 5

• 6

• 7

Which ONE of the followings is NOT a main element of a firm’s quality control system

• Engagement performance

• Monitoring

• Risk assessment process

• Acceptance and continuance of client relationships and specific engagements

• Ethical requirements 

Which of the following purposes are purposes of cold reviews?

• Ensure to compliance with IFRS, UK GAAP, ISA

• Identify systemic deficiencies

• Concentrates on significant judgements made and conclusions reached in formulating the auditor’s report

• Take remedial actions