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Audit - Quiz
Audit
  • 1. What is the Latin origin of the word audit?
A) audiens
B) auditus
C) audire
D) auditorium
  • 2. What does the Latin word 'audire' mean?
A) To hear
B) To record
C) To count
D) To speak
  • 3. According to the text, what is the primary goal of an audit report?
A) To guarantee total immunity from fraud
B) To rewrite the company's financial books
C) To express an opinion on the entity's financial information
D) To manage the entity's daily operations
  • 4. Who coined the term 'Audit Society'?
A) Chatfield
B) Moyer
C) The Public Company Accounting Oversight Board
D) Michael Power
  • 5. In medieval times, what did British auditors do to verify accounts?
A) They heard accounts read out to them
B) They performed statistical sampling
C) They reviewed computer logs
D) They conducted digital forensic analysis
  • 6. What is the primary focus of an Information Technology audit?
A) Marketing strategies
B) Management controls within an IT infrastructure
C) Employee payroll calculations
D) Physical building security
  • 7. What does an IT audit determine regarding organizational goals?
A) If systems are operating effectively to achieve goals
B) If the company should switch to a different software provider
C) If the hardware is aesthetically pleasing
D) If the IT staff is paid above market rate
  • 8. Why is an audit typically required for many entities?
A) Due to incentives to misstate financial information
B) To increase the company's stock price
C) To reduce electricity consumption
D) To automate bookkeeping tasks
  • 9. What kind of assurance do audits provide?
A) First-party assurance
B) Third-party assurance
C) Absolute internal assurance
D) Government-mandated tax clearance
  • 10. What is a statutory audit?
A) A legally required review of financial statements
B) A project management evaluation
C) A voluntary energy conservation audit
D) An optional internal assessment
  • 11. What is the purpose of statistical sampling in audits?
A) To eliminate the need for an auditor
B) To verify every single transaction without exception
C) To address constraints and provide reasonable assurance
D) To make the audit faster but less reliable
  • 12. What does 'cost audit' verify?
A) Tax returns and legal compliance
B) Cost accounts and records
C) Human resource policies
D) Public relations efforts
  • 13. According to Moyer in 1951, what was the most important duty of the auditor?
A) To assess project management risks
B) To advise on management strategy
C) To verify bookkeeping detail
D) To detect fraud
  • 14. What does a 'true and fair' set of financial statements indicate?
A) They have been approved by the government
B) They are free of material misstatements
C) They reflect only quantitative factors
D) They contain no mistakes of any kind
  • 15. Which field considers auditing as a costly activity in economic theory?
A) Statistical physics
B) Optimal auditing
C) Forensic accounting
D) Public administration
  • 16. Which organization governs audits of publicly traded companies in the US?
A) American Institute of Certified Public Accountants (AICPA)
B) Securities and Exchange Commission (SEC)
C) Financial Accounting Standards Board (FASB)
D) Public Company Accounting Oversight Board (PCAOB)
  • 17. Which section of the Sarbanes–Oxley Act of 2002 established the PCAOB?
A) Section 302
B) Section 201
C) Section 404
D) Section 501
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