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LSU ACCT 3222 Wiley TEST 1| 164 QUESTIONS|
WITH COMPLETE SOLUTIONS
Question 1: the name of a clean report for private companies
CORRECT ANSWER: unmodified report
Question 2: the name of a clean report for public companies
CORRECT ANSWER : unqualified report
Question 3: means that in the auditors' opinion if the company
follows GAAP
CORRECT ANSWER : clean report
Question 4: the date at the bottom of the audit report, stating 45
days after year end, when auditors stop gathering evidence, no hard deadline from the government
CORRECT ANSWER : end of field work
Question 5: management's responsibilities
CORRECT ANSWER : -designing, implementing, and
maintaining internal controls -creating financial statements
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-following GAAP -estimates for financial statements stems -gives auditors access to records, documentation, and personnel
Question 6: NASBA
CORRECT ANSWER : -who you apply with to take the CPA
exam; only handles the applications to take the CPA exam, not dealt with by each particular state -every state has their own state board; determines the education requirements for the state -licensing is controlled at the state level -make high level decisions, appointed by the governor
Question 7: AICPA
CORRECT ANSWER : -professional organization, like
exclusive club -makes and grades the CPA exam -issues the AU-C (auditing accounting estimates) -created SAS (Statements on Auditing Standards)
Question 8: issues your CPA license
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CORRECT ANSWER : state
Question 9: ASB
CORRECT ANSWER : -audit standards for private and non-
profit organizations -made up of members from the AICPA that are full time auditors and volunteering to be part of the this and members rotate -make detailed guidance for other standards
Question 10: FASB
CORRECT ANSWER : -establishes financial accounting and
reporting standards for public companies -deals with GAAP
Question 11: PCAOB
CORRECT ANSWER : -created during the SOX legislation
-oversees auditing -imposes punishments on those that do not adhere to audit regulations
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Question 12: SEC
CORRECT ANSWER : -appointed by the president
-protects investors, maintains fair markets, facilitates capital formation -enforces and interprets securities laws
Question 13: reasons for having standards
CORRECT ANSWER : -uniformity and quality
-requirement for public companies and being audited in the same way -stock markets would not function -standards are guidelines to measure quality of audit work -government inspections happen from PCAOB