Accounting: Tax and Financial Statements

Topics: Tax, Financial audit, Audit Pages: 9 (2245 words) Published: December 15, 2011
SOME OF THESE ANSWER ARE NO LONGER VALID AFTER THE END OF 2008. THOSE ITEMS ARE NOT ON OUR EXAM TOMORROW.

1. An audit of a government, conducted in accordance with generally accepted auditing standards (GAAS), includes A. A determination of efficiency and effectiveness.
B. An examination of financial statements and underlying records for conformance with generally accepted accounting principles (GAAP). It does this as well as generally accepted governmental auditing standards C. Tests for compliance with laws and regulations.

D. Both B and C.
2. Government Auditing Standards (GAS) issued by the U.S. Comptroller General apply to A. Financial statement audits of federal organizations made by the Government Accountability Office. B. Financial statement audits of federal programs made by state auditors. C. Financial statements of federal grants made by independent CPAs. D. All of the above.

3. The single audit concept refers to
A. All audits of state and local government reporting entities. B. Audits to determine efficiency and economy.
C. Audits following the Single Audit Act of 1984 (with 1996 Amendments) and the revised OMB Circular A-133. D. Financial and performance audits, and attestation engagements. 4. One of the primary purposes of the Single Audit Act of 1984 (amended in 1996) is to A. Detect fraud, waste and abuse in government entities.

B. To promote the efficient and effective use of audit resources by consolidating audit activity into one organization-wide audit. C. Make audit activity legal at the federal level.
D. Allow federal auditors greater access to government entities receiving federal funds. 5. A typical objective of a performance audit is for the auditor to A. Determine whether the financial statements fairly present the entity's operational results. B. Judge the appropriateness of an entity's program goals. C. Make recommendations for improving performance.

D. Attest to whether the financial statements are prepared in accordance with generally accepted accounting principles. 6. Generally Accepted Government Auditing Standards (GAGAS)
A. Establish the same scope as GAAS, but use wording appropriate to governmental entities instead of business organizations. B. Are set forth in the "Federal Government Red Book."
C. Establish more extensive standards than those found in GAAS. D. Establish standard wording of auditor's reports on governmental financial statements. 7. An auditor would not render an opinion on a (an)

A. Financial audit of financial statements.
B. Performance audit.
C. Audit to determine whether the entity has adhered to specific compliance requirements applicable to a major program. D. All of the above.
8. A single audit conducted pursuant to the Single Audit Act Amendments of 1996 requires which of the following types of audits? A. Financial Audit: Yes; Performance Audit: No
B. Financial Audit: No; Performance Audit: No
C. Financial Audit: No; Performance Audit: Yes
D. Financial Audit: Yes; Performance Audit: Yes
9. Which of the following best describes the relationship between generally accepted auditing standards (GAAS) and government auditing standards (GAS)? A. GAAS apply to independent CPA auditors; GAS apply to governmental auditors. B. Audits conducted in conformity with the yellow book may also require the auditor to conform to GAAS. C. Audits done in accordance with GAS must also be done in accordance with GAAS. D. Audits of state and local governments always required that the audit be conducted in accordance with both GAAS and GAS. 10. Which of the following federal officials is a "principal" of the Joint Financial Management Improvement Program who considers and approves or disapproves accounting and reporting standards recommended by the Federal Accounting Standards Advisory Board? A. Chair of the Federal Accounting Standards Advisory Board. B....
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