Best Auditing MCQs

Which of the following is the main object of an audit ___

a) Expression of opinion

b) Detection and Prevention of fraud and error

c) Both (a) and (b)

d) Depends on the type of audit.

Which of the title of AAS2 issued by Council of ICAI ___

a) Objective and Scope of the Financial Statements

b) Objective and Scope of the Audit of Financial Statements

c) Objective and Scope of Business of an Entity

d) Objective and Scope of Financial Statements Audit

Which of the following is not true about opinion on financial statements?

a) The auditor should express an opinion on financial statements.

b) His opinion is no guarantee to future viability of business

c) He is responsible for detection and prevention of frauds and errors in financial statements

d) He should examine whether recognised accounting principle have been consistently

A sale of Rs. 50.000 to A was entered as a sale to B. This is an example of
a) Error of omission

b) Error of commission

c) Compensating error

d) Error of principle

Goods sent on approval basis’ have been recorded as ‘Credit sales’. This is an example of _

a) Error of principle

b) Error of commission

c) Error of omission

d) Error of duplication


As per AAS4 if auditor detects an error then –

a) He should inform the management.

b) He should communicate it to the management if it is material

c) The auditor should ensure financial statements are adjusted for detected errors.

d) Both (b) and (c)

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