In the name of ALLAH, the most beneficient, the most merciful

Fundamentals of Auditing (ACC311)

Multiple Choice Questions (MCQs)

Objective Questions

  1. While preparing the audit report an auditor should follow the auditing standard for minimizing the audit risk, highlight the correct standard.

    1. ISA 315
    2. ISA 316
    3. ISA 317
    4. ISA 318
  2. Which one of the following is NOT the type of Auditor's Liabilities?

    1. Accounting liabilities
    2. Civil liabilities
    3. Criminal liabilities
    4. Liabilities for misfeasance
  3. The appointment of first auditor is responsibility of the comoany, the company is bound to do so according to Clause of Law:

    1. 250
    2. 251
    3. 252
    4. 253
  4. Which one of the following is NOT a matter related to the financing activities that an auditor considers during understanding entity and its environment?

    1. Debt financing
    2. Equity financing
    3. Beneficial owners (i.e. local or foreign)
    4. Financial statements presentation and disclosure
  5. Which one of the following approaches is primarily used by the auditor to perform extensive substantive testing?

    1. Systems audit approach
    2. verification approach
    3. Diversification approach
    4. Standardized approach
  6. The management is forced to adopt the Auditing process for avoiding the factors exists in financial statements EXCEPT?

    1. Errors & Frauds
    2. Inadvertently or deliberately misleading
    3. Information showing company's current position
    4. Unable to disclosed relevant information
  7. To provide a reliable audit report, an auditor preferably must have a proper understanding of:

    1. Entity and its overall environment
    2. Entity and its marketing environment
    3. Entity and its production environment
    4. Entity and its workplace environment
  8. Which one of the following is TRUE about Internal Control Questionaire (ICQ)?

    1. It comprises a list of internal controls in existence
    2. It highlights growth opportunities for a company
    3. It helps to identify earning trend of a company
    4. It used in small company audits