Exercise on PSA 210

What is the effective date for PSA 210 (Redrafted)?

• June 30, 2010

• December 15, 2009

• March 1, 2007

• January 1, 2008

Which paragraph outlines the preconditions for an audit?

• Paragraph 6

• Paragraph 9

• Paragraph 14

• Paragraph 18

What must the auditor obtain from management regarding their responsibilities?

• Oral agreement

• Email acknowledgment

• Written confirmation

• Public statement

What is the primary objective of the auditor according to PSA 210?

• To issue a report

• To assess internal controls

• To accept or continue an audit engagement

• To prepare financial statements

Which of the following is NOT included in the audit engagement letter?

• The applicable financial reporting framework

• The scope of the audit

• The auditor's fee structure

• The responsibilities of management

What should the auditor do if management imposes a limitation on the scope of the audit?

• Accept the engagement

• Proceed with the audit

• Ignore the limitation

• Withdraw from the engagement

What is the term used for the framework that management must use in preparing financial statements?

• Compliance Framework

• Audit Framework

• Financial Reporting Framework

• Regulatory Framework

In recurring audits, what must the auditor assess?

• The qualifications of the audit team

• The need to revise the terms of the audit engagement

• The effectiveness of internal controls

• The need for a new engagement letter

What should the auditor do if the financial reporting framework is deemed unacceptable?

• Accept the audit engagement

• Ignore the framework

• Discuss with management

• Proceed without any changes

What is the purpose of the audit engagement letter?

• To provide legal protection

• To summarize audit findings

• To avoid misunderstandings

• To outline the auditor's fees