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Ac555 Midterm Exam

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Ac555 Midterm Exam
1. | Question : | (TCO F) The objective of the ordinary audit of financial statements is the expression of an opinion on: | | | Student Answer: | | the fairness of the financial statements | | | | the accuracy of the financial statements | | | | the accuracy of the annual report | | | | the balance sheet and income statement | | Instructor Explanation: | Chapter 6, p. 134. | | | | Points Received: | 5 of 5 | | Comments: | | | |

2. | Question : | (TCO F) If the auditor believes that the financial statements are not fairly stated or is unable to reach an conclusion because of insufficient evidence, the auditor: | | | Student Answer: | | should withdraw from the engagement | | | | should request an increase in audit fees so that more resources can be used to conduct the audit | | | | has the responsibility of notifying financial statement users through the auditor's report | | | | should notify regulators of the circumstances | | Instructor Explanation: | Chapter 6, p. 135. | | | | Points Received: | 5 of 5 | | Comments: | | | |

3. | Question : | (TCO F) Which of the following statements is true of a public company's financial statements? | | | Student Answer: | | Sarbanes-Oxley requires only the CEO to certify the financial statements. | | | | Sarbanes-Oxley requires only the CFO to certify the financial statements. | | | | Sarbanes-Oxley requires the CEO and CFO to certify the financial statements. | | | | Sarbanes-Oxley requires neither the CEO nor the CFO to certify the financial statements. | | Instructor Explanation: | Chapter 6, p. 136. | | | | Points Received: | 5 of 5 | | Comments: | | | |

4. | Question : | (TCO F) The auditor's best defense when material misstatements are not uncovered is to have conducted the audit: | | | Student Answer: | | in accordance with auditing standards | | | |
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