Lec 05 Ch 04 SA 500

Which one is not part of risk assessment procedure ?

• Understanding Business from Director

• Understanding Production of company Form Manager

• Understanding System From Employee

• Checking salary from duplicate copy of salary slip

Which of the following gives rise to Risk at Financial Statement Level

• Inventory appears overvalued

• Investment ownership is disputed

• Debtor recovery appears doubtful

• CEO CFO are not honest people

Which procedures are performed after risk assessment procedures ?

• Other audit procedures

• Additional audit procedures

• Further Audit Procedures

• Other Audit Procedures

Auditor goes to see how research and development work is done in hi-tech lab, which of the following method he is using ?

• Reperformance

• Observation

• Inspection

• Analytical Procedures

Which of the following is not a problem with observation?

• It gives evidence at that moment and not for the whole year.

• It gives visual and reliable evidence.

• It can be time consuming.

• People may so acting in front of the auditor.