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CPA EXAM MULTIPLE CHOICE QUESTIONS - Introduction to Auditing 1. Auditing standards differ from auditing procedures in that procedures relate to a) Measure of performance. b) Audit principles. c) Acts to be performed. d) Audit judgments. 2. The independent auditor of 1900 differs from the auditor of today in that the 1900 auditor was more concerned with the a) Validity of the income statement. b) Determination of fair presentation of financial statements. c) Improvement of accounting systems. d) Detection of irregularities. 3. The first general standard of generally accepted auditing standards which states, in part, that the examination is to be performed by a person or persons having adequate technical training, requires that an auditor have a) Education and experience in the field of auditing. b) Ability in the planning and supervision of the audit work. c) Proficiency in business and financial matters. d) Knowledge in the areas of financial accounting. 4. The first standard of field work, which states that the work is to be adequately planned, and assistants, if any, are to be properly supervised, recognizes that a) Early appointment of the auditor is advantageous to the auditor and the client. b) Acceptance of an audit engagement after the close of the client's fiscal year is generally not permissible. c) Appointment of the auditor subsequent to the physical count of inventories requires a disclaimer of opinion. d) Performance of substantial parts of the examination is necessary at interim dates. 5. An independent audit aids in the communication of economic data because the audit a) Assures the reader of financial statements that any fraudulent activity has been corrected. b) Confirms the accuracy of management's financial representations. c) Lends credibility to the financial statements. d) Guarantees that financial data are fairly presented. 6. A CPA is most likely to refer to one or more of the three general auditing standards in determining a) Whether the