Sample Conclusion of a Nutritional Assessment Essay

Sample Conclusion of a Nutritional Assessment EssayIn most cases, you will find that a sample conclusion of a nutritional assessment essay is a good thing to have if you are a student. When you write this type of paper, you are giving your opinion on the topics you choose. After you write, you will often be asked to write several papers and essays. Each one should come with a different conclusion.The general conclusion could be anything you want to include. If you were asked to write an essay for an elective, you could include the overall view of the subject as well as various other subjects to show the student's depth of understanding. You could even add a brief paragraph about a major aspect of the topic for emphasis.Many students are asked to write a paper or essay because of their student status, for example they are going to graduate in the next few months. There are many papers that are written to give the student's views on a topic that is very important.Many students write th ese papers to help them when they talk to others about their viewpoints. Often you will be asked to write a paper for an exam or homework assignment. When you write a paper for a test, you can't just decide to go with your honest opinion.In order to help you with this, you should know that you must be able to give an impartial point of view. A sample conclusion of a nutritional assessment essay can help you do this.When you write this type of paper, you should also consider how it will help your student's perspective. Sometimes the student's viewpoint is not in alignment with what you have decided. There are many ways to achieve this.For example, maybe the student is a vegetarian, and you are required to write about the meat industry. You need to make sure that you have an impartial point of view for this type of paper. You may also be asked to write for an essay for a teacher-student council meeting.

Muriels wedding essays

Muriels wedding essays Muriels Wedding is a stereotypical view at the image of weddings and marriages. Throughout the movie the idea that a wedding heals nothing is strongly imprinted by Muriel and various weddings and marriages. The movie is about personal growth and acceptance as reflected by the change in some characters that remain constant and consistent throughout. At the opening scenes of the movie it quickly becomes apparent that Muriel is one of five struggling kids who are jobless and lifeless. Throughout the movie scenes cutting back to the kids give a picture that they have no real aim or objective in life with the exception of Muriel. The source of the problem lies heavily on the parents, Bill and Betty Heslop. Bill is constantly putting down the kids with such words as Youre all useless and Betty just seems to sit by and watch. All these scenes revolve around the theme of acceptance as shown at the end of the film when Muriel is talking to Bill. In this scene Muriel shows herself as a strong grown female who knows what she wants in her life. Muriel finally accepts her treacherous past of lies and deceit by confronting it with Bill symbolising personal growth. Muriels approach to marriage and love is equivalent to that of a six-year-old girl. For the duration of the movie Muriel refers to marriage as an escape from her life, a quick fix, a dream yet be known to Muriels self marriage is not what Muriel is looking for but the feeling of living, to be independent not dependent. Muriel begins to understand this after the death of her mother and the fake marriage to David Van Arckle. These scenes strongly represent the line of personal growth Muriel undertakes. A person that also portrayed acceptance and helps Muriel through her stage of personal growth is Rhonda. As soon as Muriel reunites with Rhonda on Hibiscus Island, Rhonda does not judge Muriel on her company or clothes but herself which is something ...

Siberian White Crane Facts

Siberian White Crane Facts The critically endangered Siberian white crane (Grus leucogeranus) is considered sacred to the people of Siberias arctic tundra, but its numbers are rapidly declining. It makes the longest migrations of any crane species, up to 10,000 miles round trip, and habitat loss along its migration routes is a major cause of the cranes population crisis. Fast Facts: Siberian white crane Scientific Name: Grus leucogeranusCommon Name: Siberian white craneBasic Animal Group: BirdSize: Height: 55 inches, Wingspan: 83 to 91 inchesWeight: 10.8 to 19 poundsLifespan: 32.3 years (female, average), 36.2 years (male, average), 82 years (in captivity)Diet: OmnivoreHabitat: Siberias arctic tundraPopulation: 2,900 to 3,000Conservation Status:  Critically Endangered Description Adult cranes faces are bare of feathers and brick-red in color. Their plumage is white except for the primary wing feathers, which are black. Their long legs are a deep pink color. Males and females are identical in appearance except for the fact that males tend to be slightly larger in size and females tend to have shorter beaks. Juvenile cranes faces are a dark red color, and the feathers of their heads and necks are a light rust color. Younger cranes have mottled brown and white plumage, and hatchlings are a solid brown color. EarnestTse/Getty Images Habitat and Range Siberian cranes nest in wetlands of the lowland tundra and taiga. They are the most aquatic of the crane species, preferring open expanses of shallow, freshwater with clear visibility in all directions. There are two remaining populations of the Siberian crane. The larger eastern population breeds in northeastern Siberia and winters along the Yangtze River in China. The western population winters at a single site along the south coast of the Caspian Sea in Iran and breeds just south of the Ob River east of the Ural Mountains in Russia. A central population once nested in western Siberia and wintered in India. The last sighting in India was documented in 2002. The historic breeding area of the Siberian crane extended from the Ural Mountains south to the Ishim and Tobol rivers, and east to the Kolyma region. Diet and Behavior At their breeding grounds in spring, cranes will eat cranberries, rodents, fish, and insects. While on migration and at their wintering grounds, cranes will dig roots and tubers from wetlands. They are known to forage in deeper water than other cranes. Reproduction Siberian Cranes are monogamous. They migrate to the Arctic tundra to breed in late April and early May. Mated pairs engage in calling and posturing as a breeding display. As part of this calling ritual, males draw their head and neck back into an S shape, says Animal Diversity Web. The female then joins in holding her head up and moving it up and down with each call in unison with the male. Females usually lay two eggs in the first week of June, after snowmelt. Both parents incubate the eggs for about 29 days. Chicks fledge at about 75 days and reach sexual maturity in three years. It is common for only one chick to survive due to aggression between siblings. Visage/Getty Images Threats Agricultural development, wetland drainage, oil exploration, and water development projects have all contributed to the decline of the Siberian crane. The western population in Pakistan and Afghanistan has been threatened by hunting more than the eastern, where the loss of wetland habitat has been more detrimental. Poisoning has killed cranes in China, and pesticides and pollution are known threats in India. Conservation Status The IUCN lists the Siberian crane as critically endangered. Indeed, it is on the brink of extinction. Its current population is estimated at 3,200 to 4,000. The largest threat to the Siberian crane is habitat loss, especially due to water diversions and conversion of wetlands to other uses as well as illegal hunting, trapping, poisoning, pollution, and environmental contamination. The IUCN and other sources say that the Siberian crane population is declining sharply. The Siberian crane is legally protected throughout its range and is protected from international trade by its listing on Appendix I of the Convention on International Trade in Endangered Species (CITES). Conservation Efforts Eleven states in the cranes historic range (Afghanistan, Azerbaijan, China, India, Iran, Kazakhstan, Mongolia, Pakistan, Turkmenistan, Russia, and Uzbekistan) signed a Memorandum of Understanding under the Convention for Migratory Species in the early 1990s, and they develop conservation plans every three years. The United Nations Environment Program (UNEP) and the International Crane Foundation conducted the UNEP/GEF Siberian Crane Wetland Project from 2003 to 2009 to protect and manage a network of sites across Asia. Protected areas have been established at key sites and migratory stopovers in Russia, China, Pakistan, and India. Educational programs have been carried out in India, Pakistan, and Afghanistan. Three captive-breeding facilities have been set up and a number of releases have been made, with targeted efforts to reestablish the central population. From 1991 to 2010, 139 captive-bred birds were released at breeding grounds, migration stopovers, and wintering grounds. Russian scientists started the Flight of Hope project, using conservation techniques that have helped boost Whooping Crane populations in North America. The Siberian Crane Wetland Project was a six-year effort to sustain the ecological integrity of a network of globally important wetlands in four key countries: China, Iran, Kazakhstan, and Russia. The Siberian Crane Flyway Coordination enhances communication among the large network of scientists, governmental agencies, biologists, private organizations, and citizens involved with Siberian Crane conservation. Sources Grus  leucogeranus Siberian crane. Animal Diversity Web.â€Å"The IUCN Red List of Threatened Species.†Ã‚  IUCN Red List of Threatened Species.International Crane Foundation. savingcranes.orgPariona, Amber. Population Of Siberian Cranes: Important Facts And Figures.  WorldAtlas, 26 July 2017.

The Use of Sweetners and the Rise in Obesity Essay

The Use of Sweetners and the Rise in Obesity - Essay Example Sweeteners got introduced to help reduce people’s intake of sugar. A sweetener can be best described as matter used to sweeten a drink or food. This is usually in place of sugar. They became classified into two main categories: the nutritive sweeteners. These are the sweeteners that get digested in the body only to some extent; they became known to provide food energy value to the body. For example, glucose, honey, maltose and invert sugar. The other category of sweeteners is the nonnutritive sweeteners (Mendosa et al, 2008). These do not get digested as in the case of the nutritive sweeteners. It is because of this that they get said to contain an insignificant amount of food energy value. Examples include cyclamates, sucralose and stevia. One of the sweeteners used in place of the sugar is Stevia. This is a natural nonnutritive sweetener. It gets derived from the leaves of the Bertoni plant which naturally occurs in the forests of southern America. Its name got given after the botanist explorer who discovered it in 1908. He was an Italian by the name Dr. Moises Santiago Bertoni. This plant had been in existence for a couple of years. The native population knew and termed it as kaa he-he, which meant honey-leaf (Etkins, 1997). They used its leaves to improve on the taste of their bitter tea; they as well as chewed on the leaves for their sweet taste or in medical potions. It was after Dr. Bertoni’s discovery that such a little known and rare plant became well known and famous. His discovery enabled the plant to be accessed by many people other than only those who had access to its naturally occurring habitat. These being the native Indians who originally occupied the land before the explorers came. In 1908, the first dried leaves of the plant got harvested and produced as a sweetener. It was not until 10 years later that the plant got brought to the attention of the United States government

Analyzing the Stock Market Crash Dissertation Example | Topics and Well Written Essays - 10000 words

Analyzing the Stock Market Crash - Dissertation Example From this paper it is clear that  the stock market crash is referred to as a decline in the price of stocks of companies that have listed themselves in stock exchange. It results in the decrease of paper wealth which is often caused by panic than economic indicators of the country. The stock markets are crashed due to various reasons but mostly they occur due to the high prices of stocks that remain for a longer period of time. The first ever stock market crash was observed in 1929 due to increase of borrowing from the banks. People were beginning to think that the prices of stocks would remain all time high. It was an era when radio was invented by Marconi, and people were happy to see their stocks soar while becoming jubilant by viewing the performance of their company increased. Investors were investing their money through borrowing from banks which made it impossible to repay the amount when the stock market unexpectedly crashed in 1929. United States recalled the loans that we re provided to European markets which affected the European market because of their imbalance of payments.This study declares that  the stock market crash of 1929 were followed by the ‘Black Monday’ of 1987, the recession of 1990, the Asian crisis which started on 1997 and disrupted the economy of Asian giants. The Asian recession was followed by currency crisis in Russia in 1998 in which Russian domestic problems were held responsible for the crash.... The stock markets are crashed due to various reasons but mostly they occur due to the high prices of stocks that remain for a longer period of time. The first ever stock market crash was observed in 1929 due to increase of borrowing from the banks. People were beginning to think that the prices of stocks would remain all time high. It was an era when radio was invented by Marconi, and people were happy to see their stocks soar while becoming jubilant by viewing the performance of their company increased. Investors were investing their money through borrowing from banks which made it impossible to repay the amount when the stock market unexpectedly crashed in 1929. United States recalled the loans that were provided to European markets which affected the European market because of their imbalance of payments. The after effects of stock market crash have long lasting impression on the overall economy of the country. It also affects other countries that have close relation and bilateral ties with the affected country. The results include devastating effect on the economy. Similarly, the stock market crash had influenced the rise of the Great Depression which in turn prompted countries to invade other countries to gather resources. The invasion resulted in the World War II which caused millions of people to die at the hands of others. The stock market crash of 1929 were followed by the ‘Black Monday’ of 1987, the recession of 1990, the Asian crisis which started on 1997 and disrupted the economy of Asian giants. The Asian recession was followed by currency crisis in Russia in 1998 in which Russian domestic problems were held responsible for the crash. After the Russian crisis, the dot-com bubble distorted the economy Worldwide. The

Comparing The Adventures of Huckleberry Finn and Tom Sawyer :: comparison compare contrast essays

The Adventures of Huckleberry Finn and Tom Sawyer Huckleberry Finn and Tom Sawyer are the best of friends with remarkably different personalities. Each brings their unique characteristics into this comical friendship giving the novel numerous amusing passages. Throughout the tale, Tom is often the leader while Huck is the reluctant follower. It doesn't matter that Tom's ideas are ridiculous and extravagant, and Huck's are simple and practical, together they always proceed with Tom's imaginative plans. In contrast to Tom's great imagination and creativity, Huck is humorless and literal minded. Tom's imaginativeness comes only from knowledge he has gained through books. Huck, on the other hand, actually lives out the fantasies Tom can only imagine. Tom Sawyer, already civilized, follows the values and beliefs of society. Due to these convictions, Tom always abides by the laws. For these reasons, Tom would never have helped free Jim unless he knew that Jim had already been freed. Conversely, Huck Finn rejects the philosophy of political beliefs for the fear of becoming civilized. He usually runs away at the first notion of him becoming "sivilized." Huck is able to function in any society with the help of his adaptability and survival skills. He is able to go from the freedom of the raft, to the perceived harshness of civilization, and back again with ease. Although Tom has been able to slip past Death's grip so far, his chances of escaping may not always work out to his liking. Of the two, Huck will always be the survivor in life. Together this pair achieves their goals because of their intelligence and witty personalities. They have the ability to put the knowledge they obtain into their every day lives. They are two adventurous souls in search of fresh and exhilarating escapades. Their ages united with their exceptional education keeps them on their toes. Huck's humorless personality and Tom's extravagance has made

Auditing Problems Quiz

Following are multiple choice questions recently released by the AICPA. These questions were released by the AICPA with letter answers only. Our editorial board has provided the accompanying explanations. Please note that the AICPA generally releases questions that it does NOT intend to use again. These questions and content may or may not be representative of questions you may see on any upcoming exams. 2007 AICPA Newly Released Questions – Auditing 1. CPA-05465 Which of the following categories is included in generally accepted auditing standards? a. b. c. d. Standards of review.Standards of planning. Standards of fieldwork. Standards of evidence. ANSWER: Choice â€Å"c† is correct. Generally accepted auditing standards include three categories: general standards, standards of fieldwork, and standards of reporting. Choices â€Å"a†, â€Å"b†, and â€Å"d† are incorrect, based on the above explanation. 1 2007 AICPA Newly Released Questions – Auditing 2. CPA-05466 A retailing entity uses the Internet to execute and record its purchase transactions. The entity's auditor recognizes that the documentation of details of transactions will be retained for only a short period of time.To compensate for this limitation, the auditor most likely would: a. b. c. d. Compare a sample of paid vendors' invoices to the receiving records at year-end. Plan for a large measure of tolerable misstatement in substantive tests. Perform tests several times during the year, rather than only at year-end. Increase the sample of transactions to be selected for cutoff tests. ANSWER: Choice â€Å"c† is correct. When an entity transmits, processes, maintains, or accesses significant information electronically, some accounting data and source documents may be available only in electronic form, or only at a certain point in time.The auditor would generally perform tests of controls several times during the year to compensate for this limitation. Choice â€Å"a† is incorrect. Comparing a sample of paid vendors' invoices to receiving records provides evidence that the company received the goods for which it paid, but only if records are available in sufficient detail to make such a comparison. If detailed records are retained for only a short period of time, such comparisons would need to be performed throughout the year, not just at year-end.Choice â€Å"b† is incorrect. The auditor's judgment as to an appropriate level of tolerable misstatement is based on considerations of materiality and audit risk. Increasing this level implies that the auditor is willing to accept a larger error, which would not be an appropriate response to the limitation described. Choice â€Å"d† is incorrect. Increasing the sample size related to cutoff testing will not provide evidence about transactions occurring throughout the period under audit, since cutoff testing relates to year-end. 2 007 AICPA Newly Released Questions à ¢â‚¬â€œ Auditing 3. CPA-05467 (Adapted) After testing a client's internal control activities, an auditor discovers a number of significant deficiencies in the operation of a client's internal controls. Under these circumstances the auditor most likely would a. b. c. d. Issue a disclaimer of opinion about the internal controls as part of the auditor's report. Increase the assessment of control risk and increase the extent of substantive tests. Issue a qualified opinion of this finding as part of the auditor's report.Withdraw from the audit because the internal controls are ineffective. ANSWER: Choice â€Å"b† is correct. The auditor uses tests of controls to evaluate control risk. In situations where there are a number of significant deficiencies in the operation of the client's internal controls, the auditor would increase the assessment of control risk (and the risk of material misstatement) and revise substantive testing accordingly (for example, by increasing the extent of substantive tests). Choice â€Å"a† is incorrect.An auditor is required to communicate significant deficiencies to management and those charged with governance, and a disclaimer of opinion on the effectiveness of controls would be included in this communication. However, such disclaimer would not be part of the auditor's report on the financial statements. Choice â€Å"c† is incorrect. Since the auditor's report provides an opinion on the financial statements (and not on internal control), significant deficiencies in internal control do not result in a qualified opinion. Choice â€Å"d† is incorrect.The auditor need not withdraw from an audit simply because internal controls are ineffective, but rather would increase the assessment of control risk and revise substantive testing accordingly. 3 2007 AICPA Newly Released Questions – Auditing 4. CPA-05468 Which of the following procedures would be most effective in reducing attestation risk? a. b. c. d. Disc ussion with responsible individuals. Examination of evidence. Inquiries of senior management. Analytical procedures. ANSWER: Choice â€Å"b† is correct. Evidence obtained directly by the accountant (e. . , through physical examination) provides more persuasive evidence than evidence obtained through inquiry, discussion, or analytical procedures, and therefore reduces attestation risk. Choices â€Å"a†, â€Å"c†, and â€Å"d† are incorrect, based on the above explanation. 4 2007 AICPA Newly Released Questions – Auditing 5. CPA-05469 Which of the following is an inherent limitation in internal control? a. b. c. d. Incompatible duties. Lack of segregation of duties. Faulty human judgment. Lack of an audit committee. ANSWER: Choice â€Å"c† is correct.Inherent limitations in internal control are limitations that exist despite implementation of appropriate controls. For example, faulty human judgment may result in errors in the design or use of i nternal controls. Choice â€Å"a† is incorrect. Assigning incompatible duties to a particular individual indicates a missing control, rather than an inherent limitation in internal control. Choice â€Å"b† is incorrect. Lack of segregation of duties indicates a missing control, rather than an inherent limitation in internal control. Choice â€Å"d† is incorrect.Lack of an audit committee indicates a missing control, rather than an inherent limitation in internal control. 5 2007 AICPA Newly Released Questions – Auditing 6. CPA-05470 Which of the following statements is correct regarding a review engagement of a nonpublic company's financial statements performed in accordance with the Statements on Standards for Accounting and Review Services (SSARS)? a. An accountant must establish an understanding with the client in an engagement letter. b. An accountant must obtain an understanding of the client's internal control when performing a review. . A review pro vides an accountant with a basis for expressing limited assurance on the financial statements. d. A review report contains an accountant's opinion of the financial statements taken as a whole. ANSWER: Choice â€Å"c† is correct. A review report is issued when inquiry and analytical procedures provide a reasonable basis for the expression of limited assurance on the financial statements. Choice â€Å"a† is incorrect. While the accountant is required to establish an understanding with the client, preferably in writing, an engagement letter is not required.Choice â€Å"b† is incorrect. When performing a review under SSARS, the accountant is not required to obtain an understanding of the client's internal control. Choice â€Å"d† is incorrect. A review results in the expression of limited assurance that no material modifications are necessary for the financial statements to be in conformity with generally accepted accounting principles. The limited nature of the work performed during a review does not provide sufficient evidence for an opinion on the financial statements taken as a whole. 6 2007 AICPA Newly Released Questions – Auditing 7.CPA-05471 Which of the following procedures does a CPA normally perform first in a review engagement in accordance with Statements on Standards for Accounting and Review Services (SSARS)? a. b. c. d. Inquiry regarding the client's principles and practices and the method of applying them. Inquiry concerning the effectiveness of the client's system of internal control. Inquiry to identify transactions between related parties and management. Inquiry of the client's professional advisors, including bankers, insurance agents, and consultants. ANSWER: Choice â€Å"a† is correct.In performing a review engagement in accordance with SSARS, the accountant should inquire of management regarding the accounting principles and practices used, and the method of applying them. Choice â€Å"b† is i ncorrect. When performing a review under SSARS, the accountant is not required to make inquiries concerning the client's system of internal control. Choice â€Å"c† is incorrect. The accountant may inquire about the existence of related party transactions, but would likely make a more basic inquiry, about the client's accounting principles and practices, first. Choice â€Å"d† is incorrect.In performing a review engagement in accordance with SSARS, the accountant generally directs his/her inquiries to members of management, not to external parties. 7 2007 AICPA Newly Released Questions – Auditing 8. CPA-05472 (Adapted) Which of the following cash transfers results in a misstatement of cash at December 31, 20X1? Bank Transfer Schedule Transfers a. b. c. d. Disbursement date per books per bank 12 /31/X1 01/05/X2 01/04/X2 01/11/X2 12/31/X1 01/04/X2 01/04/X2 01/05/X2 Receipt date per books per bank 12/31/X1 01/04/X2 01/04/X2 01/04/X2 12/31/X1 12/31/X1 12/31/X1 01/04 /X2ANSWER: Choice â€Å"d† is correct. Since the disbursement was not recorded until January 20X2 while the receipt was recorded in December 20X1, cash will be overstated at December 31, 20X1. Choices â€Å"a† and â€Å"c† are incorrect. Both the disbursement and the receipt are recorded in 20X1, so there will be no misstatement of cash at December 31, 20X1. Choice â€Å"b† is incorrect. Both the disbursement and the receipt are recorded in 20X2, so there will be no misstatement of cash at December 31, 20X1. 8 2007 AICPA Newly Released Questions – Auditing 9.CPA-05473 Which of the following describes how the objective of a review of financial statements differs from the objective of a compilation engagement? a. The primary objective of a review engagement is to test the completeness of the financial statements prepared, but a compilation tests for reasonableness. b. The primary objective of a review engagement is to provide positive assurance that the financial statements are fairly presented, but a compilation provides no such assurance. c. In a review engagement, accountants provide limited assurance, but a compilation expresses no assurance. . In a review engagement, accountants provide reasonable or positive assurance that the financial statements are fairly presented, but a compilation provides limited assurance. ANSWER: Choice â€Å"c† is correct. A review provides limited assurance that there are no material modifications that should be made to the financial statements in order for them to be in conformity with generally accepted accounting principles, whereas a compilation provides no assurance. Choice â€Å"a† is incorrect. A review does not test for completeness, nor does a compilation test for reasonableness.A review provides limited assurance about the financial statements based on inquiry and analytical review procedures, while a compilation provides no assurance and includes no testing for reasonab leness. Choice â€Å"b† is incorrect. A review provides limited assurance that there are no material modifications that should be made to the financial statements in order for them to be in conformity with generally accepted accounting principles, and it is based on inquiry and analytical review procedures. Positive assurance (such as an audit opinion) is only provided when more extensive procedures have been erformed. Choice â€Å"d† is incorrect. A review provides limited assurance that there are no material modifications that should be made to the financial statements in order for them to be in conformity with generally accepted accounting principles, and it is based on inquiry and analytical review procedures. Positive or reasonable assurance (such as an audit opinion) is only provided when more extensive procedures have been performed. A compilation provides no assurance at all. 9 2007 AICPA Newly Released Questions – Auditing 10.CPA-05474 (Adapted) Prior t o commencing fieldwork, an auditor usually discusses the general audit strategy with the client's management. Which of the following matters do the auditor and management agree upon at this time? a. b. c. d. The appropriateness of the entity's plans for dealing with adverse economic conditions. The determination of the fraud risk factors that exist within the client's operations. The control weaknesses to be included in the communication with those charged with governance. The coordination of the assistance of the client's personnel in data preparation.ANSWER: Choice â€Å"d† is correct. Prior to commencing fieldwork, an auditor would establish an understanding with the client as to the services to be performed and the overall audit strategy. This understanding may include arrangements involving the conduct of the engagement, such as timing, client assistance, and the availability of documents. Choice â€Å"a† is incorrect. The auditor does not evaluate the appropriate ness of the entity's plans for dealing with adverse economic conditions prior to commencing fieldwork.The auditor might consider this as part of evaluating the client's ability to continue as a going concern, but this would not occur prior to commencing fieldwork. Choice â€Å"b† is incorrect. Determination of existing fraud risk factors is generally made during the fieldwork stage of the audit, as information and evidence is obtained. Also, fraud risk factors are assessed by the auditor, and would not necessarily be agreed upon with management. Choice â€Å"c† is incorrect. Identification and evaluation of control weaknesses generally occurs during the fieldwork stage of the audit, as information and evidence is obtained.Only those weaknesses that rise to the level of being significant deficiencies (or material weaknesses) are required to be communicated to those charged with governance. 10 2007 AICPA Newly Released Questions – Auditing 11. CPA-05475 (Adapted) An auditor's engagement letter most likely would include a statement that: a. b. c. d. Lists potential significant deficiencies discovered during the prior year's audit. Explains the analytical procedures that the auditor expects to apply. Describes the auditor's responsibility to evaluate going concern issues.Limits the auditor's responsibility to detect errors and fraud. ANSWER: Choice â€Å"d† is correct. An auditor's engagement letter typically includes discussion of limitations of the engagement, such as the fact that the auditor will obtain only reasonable assurance, and therefore a material misstatement may remain undetected. Choice â€Å"a† is incorrect. An auditor's engagement letter typically covers the objectives of the engagement, management's responsibilities, the auditor's responsibilities, limitations of the engagement, and other matters involving the conduct of the audit.Potential significant deficiencies discovered during the prior year's audit would n ot typically be included in the engagement letter. Choice â€Å"b† is incorrect. While the auditor's engagement letter might include a discussion of the overall audit strategy, it typically would not include specific audit procedures. Choice â€Å"c† is incorrect. While the auditor's engagement letter might include a discussion of the auditor's responsibilities, this is usually discussed in fairly general terms. An engagement letter would not describe the auditor's responsibility with respect to specific issues (such as going concern issues). 1 2007 AICPA Newly Released Questions – Auditing 12. CPA-05476 Which of the following factors most likely would cause a CPA to decline to accept a new audit engagement? a. b. c. d. The CPA does not understand the entity's operations and industry. Management acknowledges that the entity has had recurring operating losses. The CPA is unable to review the predecessor auditor's working papers. Management is unwilling to permit inquiry of its legal counsel. ANSWER: Choice â€Å"d† is correct. If a prospective client is unwilling to permit inquiry of its legal counsel, the CPA must consider the implications of this refusal.Such refusal may indicate a lack of cooperativeness on the part of management, or an attempt to be less than forthright with respect to litigation, claims, and assessments. Furthermore, a client's refusal to permit inquiry of its legal counsel ordinarily would result in a disclaimer of opinion. It would be unlikely that a CPA would accept a new engagement under these circumstances. Choice â€Å"a† is incorrect. An understanding of the client's operations and industry should be obtained during the planning stage of the audit.It does not necessarily need to be obtained before acceptance of the engagement. Choice â€Å"b† is incorrect. The fact that the entity has had recurring operating losses may increase the auditor's assessment of risk on the engagement, but it would not preclude acceptance of the engagement. Choice â€Å"c† is incorrect. Although the predecessor's audit documentation provides some audit evidence with respect to opening balances, consistency of accounting principles, and other matters of continuing significance, alternative means of obtaining such evidence generally do exist. 2 2007 AICPA Newly Released Questions – Auditing 13. CPA-05477 An enterprise engaged a CPA to audit its financial statements in accordance with Government Auditing Standards (the Yellow Book) because of the provisions of government grant funding agreements. Under these circumstances, the CPA is required to report on the enterprise's internal controls either in the report on the financial statements or in: a. b. c. d. The report on the performance audit. The notes to the financial statements. A letter to the government funding agency.A separate report. ANSWER: Choice â€Å"d† is correct. The report on the audit of the financial statemen ts should describe the scope of the auditor's testing of compliance with laws and regulations and internal control over financial reporting, and should either present the results of those tests or refer to a separate report containing that information. Choice â€Å"a† is incorrect. The CPA was engaged to audit financial statements in accordance with the Yellow Book, not to perform a performance audit. Choice â€Å"b† is incorrect.The notes to the financial statements are a management representation and would not be used by the CPA to comply with requirements to either report or opine in conformity with Yellow Book requirements. Choice â€Å"c† is incorrect. Governmental Auditing Standards require that the auditor describe the scope of the auditor's testing of compliance with laws and regulations and internal control over financial reporting and present the results of those tests as part of their report or in a separate report, not simply in a letter to the fundi ng agency. 13 2007 AICPA Newly Released Questions – Auditing 14.CPA-05478 An auditor determines that the entity is presenting certain supplementary financial disclosures of pension information that are required by the GASB. Under these circumstances, the auditor should: a. Add an explanatory paragraph to the auditor's report that refers to the required supplementary information. b. State that the audit is not being performed in accordance with generally accepted auditing standards. c. Document in the working papers that the required supplementary information is presented, but should not apply any procedures to the information. . Compare the required supplementary information for consistency with the audited financial statements. ANSWER: Choice â€Å"d† is correct. The auditor should perform certain limited procedures on supplementary information accompanying the financial statements, including evaluating whether the information is consistent with the audited financial statements. Choice â€Å"a† is incorrect. Generally, the auditor's report on the financial statements would not include a reference to required supplementary information unless there were a problem with it (e. . , it was omitted, inappropriately prepared, or the auditor was unable to satisfactorily complete required procedures). Choice â€Å"b† is incorrect. An audit can and should be performed in accordance with generally accepted auditing standards even when required supplementary information is presented. Choice â€Å"c† is incorrect. The auditor should perform certain limited procedures on supplementary information accompanying the financial statements. 14 2007 AICPA Newly Released Questions – Auditing 15. CPA-05479 Comfort letters ordinarily are: a. . c. d. Addressed to the client's Audit committee Underwriter of securities Audit committee Underwriter of securities Signed by the client's Independent auditor Senior management Senior management Indepen dent auditor ANSWER: Choice â€Å"d† is correct. A comfort letter is a letter from the independent auditor to the named underwriter just before the registration of the client's securities. Choices â€Å"a†, â€Å"b†, and â€Å"c† are incorrect, based on the above explanation. 15 2007 AICPA Newly Released Questions – Auditing 16.CPA-05480 Which of the following factors would most likely influence an auditor's consideration of the reliability of data when performing analytical procedures? a. b. c. d. Whether the data were developed in a computerized or a manual accounting system. Whether the data were prepared on the cash basis or in conformity with GAAP. Whether the data were developed under a system with adequate controls. Whether the data were processed in an online system or a batch entry system. ANSWER: Choice â€Å"c† is correct. Strong, effective internal controls improve the reliability of data.Choice â€Å"a† is incorrect. The type of accounting system used does not affect the reliability of data. Both computerized and manual accounting systems can provide reliable data, as long as there are appropriate controls in place. Choice â€Å"b† is incorrect. The accounting basis used does not affect the reliability of data. Reliable data may be provided regardless of whether the cash basis or accrual basis (GAAP) is used, as long as there are appropriate controls in place. Choice â€Å"d† is incorrect. The type of processing system used does not affect the reliability of data.Both online systems and batch systems can provide reliable data, as long as there are appropriate controls in place. 16 2007 AICPA Newly Released Questions – Auditing 17. CPA-05481 When an auditor tests the internal controls of a computerized accounting system, which of the following is true of the test data approach? a. Test data are coded to a dummy subsidiary so they can be extracted from the system under actual oper ating conditions. b. Test data programs need not be tailor-made by the auditor for each client's computer applications. c.Test data programs usually consist of all possible valid and invalid conditions regarding compliance with internal controls. d. Test data are processed with the client's computer and the results are compared with the auditor's predetermined results. ANSWER: Choice â€Å"d† is correct. The test data approach refers to a technique in which the client's application program is used to process a set of test data, the results of which are already known by the auditor. If the client's program is operating effectively, it should generate the same results determined by the auditor. Choice â€Å"a† is incorrect.An integrated test facility (not a test data approach) utilizes dummy accounts. For example, using an integrated test facility (ITF) approach, test data is initially commingled with live data, but coding to a dummy account allows later extraction from the system under actual operating conditions. Choice â€Å"b† is incorrect. Test data programs should be tailor-made by the auditor for each client's computer applications, to ensure that the data is in an appropriate form for that client's system, and that it includes the types of invalid conditions in which the auditor is interested. Choice â€Å"c† is incorrect.Test data contains the types of valid and invalid conditions in which the auditor is interested (it is not necessary to test all combinations of valid and invalid conditions). 17 2007 AICPA Newly Released Questions – Auditing 18. CPA-05482 Under which of the following circumstances would an auditor's expression of an unqualified opinion be inappropriate? a. b. c. d. The auditor is unable to obtain the audited financial statements of a significant subsidiary. The financial statements are prepared on the entity's income tax basis. There are significant deficiencies in the design and operation of the enti ty's internal control.Analytical procedures indicate that many year-end account balances are not comparable with the prior year's balances. ANSWER: Choice â€Å"a† is correct. If the auditor is unable to obtain the audited financial statements of a significant subsidiary, a scope limitation exists. Assuming the effect is material, the auditor would issue either a qualified opinion or a disclaimer of opinion. Choice â€Å"b† is incorrect. Financial statements prepared on an entity's income tax basis are â€Å"other comprehensive basis of accounting† (OCBOA) financial statements.The auditor may issue a special report, which can include an unqualified opinion, on OCBOA financial statements. Choice â€Å"c† is incorrect. Significant deficiencies in the design and operation of an entity's internal control do not preclude issuance of an unqualified opinion, although they do increase the risk of material misstatement and will likely result in modifications to th e nature, timing, and extent of the auditor's testing. Choice â€Å"d† is incorrect. An unqualified opinion may still be expressed when there are significant changes in year-end account balances as compared to prior year balances, as long as the auditor as obtained sufficient appropriate audit evidence about the current balances. 18 2007 AICPA Newly Released Questions – Auditing 19. CPA-05483 An auditor's principal objective in analyzing repairs and maintenance expense accounts is to: a. b. c. d. Determine that all obsolete plant and equipment assets were written off before the year-end. Verify that all recorded plant and equipment assets actually exist. Discover expenditures that were expensed but should have been capitalized. Identify plant and equipment assets that cannot be repaired and should be written off. ANSWER: Choice â€Å"c† is correct.The auditor reviews repair and maintenance expense accounts to test for completeness of asset additions (i. e. , the auditor is looking for items recorded as repairs or maintenance that would more properly have been capitalized as betterment of an asset). Choice â€Å"a† is incorrect. Analyzing the repairs and maintenance account does not provide evidence about obsolete assets. The auditor might review asset records for old assets, or observe assets that are not being used, in an effort to determine whether obsolete plant and equipment assets were written off before year-end.Choice â€Å"b† is incorrect. Analyzing the repairs and maintenance account does not provide evidence about the existence of assets. The auditor might select recorded plant and equipment assets, and then physically locate and observe them, in order to verify existence. Choice â€Å"d† is incorrect. Analyzing the repairs and maintenance account does not provide evidence about assets that cannot be repaired. The auditor might review asset records for old assets, or observe assets that are not being used, in an effort to determine whether assets that cannot be repaired have been properly written off. 9 2007 AICPA Newly Released Questions – Auditing 20. CPA-05484 Which of the following statements is correct concerning materiality in a financial statement audit? a. Analytical procedures performed during an audit's review stage usually decrease materiality levels. b. If the materiality amount used in evaluating audit findings increases from the amount used in planning, the auditor should apply additional substantive tests. c. The auditor's materiality judgments generally involve quantitative, but not qualitative, considerations. d.Materiality levels are generally considered in terms of the smallest aggregate level of misstatement that could be considered material to any one of the financial statements. ANSWER: Choice â€Å"d† is correct. Because the financial statements are interrelated, materiality levels are generally considered in terms of the smallest level of misstateme nt that could be material to any one of the financial statements. Choice â€Å"a† is incorrect. Analytical procedures are performed during an audit's review stage to evaluate the overall financial statement presentation and to assess the conclusions reached.They generally would not result in a change in materiality levels. Choice â€Å"b† is incorrect. If the materiality amount used in evaluating audit findings increases from the amount used in planning, the auditor should consider whether the audit plan needs to be modified. Typically, an increase in materiality levels would result in a decrease in audit risk, which would result in less substantive testing, not more. Choice â€Å"c† is incorrect. Qualitative considerations may lead to situations in which misstatements that do not exceed materiality limits are still likely to influence the economic decisions of users.In such cases, an otherwise immaterial misstatement is deemed to be material. 20 2007 AICPA Newl y Released Questions – Auditing 21. CPA-05485 As a result of tests of controls, an auditor assesses control risk too high. This incorrect assessment most likely occurred because: a. Control risk based on the auditor's sample is less than the true operating effectiveness of the client's control activity. b. The auditor believes that the control activity relates to the client's assertions when, in fact, it does not. c. The auditor believes that the control activity will reduce the extent of substantive testing when, in fact, it will not. . Control risk based on the auditor's sample is greater than the true operating effectiveness of the client's control activity. ANSWER: Choice â€Å"d† is correct. The risk of assessing control risk too high is the risk that the assessed level of control risk based on the sample is greater than the true risk based on the actual operating effectiveness of the control. Choice â€Å"a† is incorrect. The risk of assessing control risk too low is the risk that the assessed level of control risk based on the sample is less than the true risk based on the actual operating effectiveness of the control.Choice â€Å"b† is incorrect. Assessing control risk too high relates to an incorrect evaluation of risk by the auditor, not to whether the control activity relates to the client's assertions. Choice â€Å"c† is incorrect. If the auditor believes that a control activity will reduce the extent of substantive testing when, in fact, it will not, this implies that the control risk based on the auditor's sample was less than the true risk based on the actual operating effectiveness of the control. This would be an example of assessing control risk too low, not too high. 21 007 AICPA Newly Released Questions – Auditing 22. CPA-05486 At the conclusion of an audit, an auditor is reviewing the evidence gathered in support of the financial statements. With regard to the valuation of inventory, the auditor co ncludes that the evidence obtained is not sufficient to support management's representations. Which of the following actions is the auditor most likely to take? a. b. c. d. Consult with the audit committee and issue a disclaimer of opinion. Consult with the audit committee and issue a qualified opinion. Obtain additional evidence regarding the valuation of inventory.Obtain a statement from management supporting their inventory valuation. ANSWER: Choice â€Å"c† is correct. If an auditor has doubts about a material assertion (such as the valuation of inventory), he/she should gather sufficient evidence to eliminate the doubt. Choices â€Å"a† and â€Å"b† are incorrect. The auditor would not consult with the audit committee regarding the sufficiency of audit evidence obtained, as this is determined based on the auditor's own judgment. In addition, if the auditor is able to obtain additional evidence, it might be possible to issue an unqualified opinion.Finally, e ven if no additional evidence is available, the auditor will still need to decide whether a qualified opinion or a disclaimer of opinion is more appropriate, depending on materiality. Choice â€Å"d† is incorrect. Since management representations are in fact â€Å"statements from management,† obtaining additional statements from management would not provide additional support. 22 2007 AICPA Newly Released Questions – Auditing 23. CPA-05487 An audit supervisor reviewed the work performed by the staff to determine if the audit was adequately performed. The supervisor accomplished this by primarily reviewing which of the following? a. b. c. d.Checklists. Working papers. Analytical procedures. Financial statements. ANSWER: Choice â€Å"b† is correct. Audit documentation, or working papers, comprises the principal record of audit procedures performed, evidence obtained, and conclusions reached. Reviewing the working papers allows a supervisor to understand the work performed and the evidence obtained, and to evaluate whether the audit was adequately performed. Choice â€Å"a† is incorrect. Checklists might be used within the audit documentation, but checklists alone would not provide a comprehensive record of the audit procedures performed, the evidence obtained, and conclusions reached.Choice â€Å"c† is incorrect. Analytical procedures might be documented within the working papers, but such procedures alone would not provide a comprehensive record of the audit procedures performed, the evidence obtained, and conclusions reached. Choice â€Å"d† is incorrect. Reviewing the financial statements would provide no information regarding the audit procedures performed, the evidence obtained, or conclusions reached, and therefore would provide no basis on which to review the work performed by the staff. 23 2007 AICPA Newly Released Questions – Auditing 24.CPA-05488 The auditor's inventory observation test counts are traced to the client's inventory listing to test for which of the following financial statement assertions? a. b. c. d. Completeness. Rights and obligations. Allocation and valuation. Understandability and classification. ANSWER: Choice â€Å"a† is correct. The auditor should test the physical inventory report by tracing test counts taken by the auditor to the report, thereby verifying its completeness. Choice â€Å"b† is incorrect. Tracing from test counts to the client's inventory listing does not test rights and obligations.Rights and obligations might be tested by examining paid vendors' invoices, inspecting consignment agreements and contracts, or by confirming inventory held at outside locations. Choice â€Å"c† is incorrect. Tracing from test counts to the client's inventory listing does not test allocation and valuation. Allocation and valuation might be tested by examining paid vendors' invoices, evaluating direct labor rates, recalculating overhead ra tes, or examining an analysis of inventory turnover. Choice â€Å"d† is incorrect. Tracing from test counts to the client's inventory listing does not test understandability and classification.Understandability and classification might be tested by confirming inventories pledged under loan agreements, examining drafts of the financial statements for appropriate balance sheet classification, etc. 24 2007 AICPA Newly Released Questions – Auditing 25. CPA-05489 Which of the following is an analytical procedure that an auditor most likely would perform when planning an audit? a. b. c. d. Confirming bank balances with the financial institutions. Scanning accounts receivable for amounts over credit limits. Recalculating inventory extensions of physical inventory counts.Comparing the current-year account balances for conformity with predictable patterns. ANSWER: Choice â€Å"d† is correct. During planning, analytical procedures consist of a review of data aggregated at a high level, with an objective of enhancing the auditor's understanding of the client. Comparing the current-year account balances for conformity with predictable patterns would fulfill this purpose. Choice â€Å"a† is incorrect. Confirmation of bank balances is a substantive audit procedure (not an analytical procedure) that would be performed during the fieldwork stage of the audit. Choice â€Å"b† is incorrect.Scanning accounts receivable for amounts over credit limits is a detailed procedure related to one specific account, and it would be performed during the fieldwork stage of the audit. Choice â€Å"c† is incorrect. Recalculating inventory extensions of physical inventory counts is a detailed procedure related to one specific account, and it would be performed during the fieldwork stage of the audit. 25 2007 AICPA Newly Released Questions – Auditing 26. CPA-05490 In which of the following circumstances is substantive testing of accounts receivabl e before the balance sheet date most appropriate? . b. c. d. The client has a new sales incentive program in place. Internal controls during the remaining period are effective. There is a high turnover of senior management. It is a first engagement of a new client. ANSWER: Choice â€Å"b† is correct. The higher the auditor's risk assessment, the closer to period end substantive procedures should be performed. Conversely, effective controls reduce control risk and reduce the risk of material misstatement, allowing more interim testing to occur. Choice â€Å"a† is incorrect.A new sales incentive program results in an increase in the risk of material misstatement, making it less likely that interim testing will be performed. Choice â€Å"c† is incorrect. High turnover of senior management results in an increase in the risk of material misstatement, making it less likely that interim testing will be performed. Choice â€Å"d† is incorrect. In the first engage ment of a new client, the auditor will have less knowledge of the client and therefore would be less inclined to utilize interim testing, which increases audit risk. 26 2007 AICPA Newly Released Questions – Auditing 27.CPA-05491 An auditor reads the letter of transmittal accompanying a county's comprehensive annual financial report and identifies a material inconsistency with the financial statements. The auditor determines that the financial statements do not require revision. Which of the following actions should the auditor take? a. b. c. d. Request that the client revise the letter of transmittal. Include an explanatory paragraph in the auditor's report. Consider withdrawing from the engagement. Request a client representation letter acknowledging the inconsistency. ANSWER: Choice â€Å"a† is correct.When information accompanies audited financial statements in a client-prepared document, the auditor is required to read the information. If such information is materi ally inconsistent with the financial statements and the financial statements do not require revision, the auditor should request that the information (in this case the letter of transmittal) be revised. Choice â€Å"b† is incorrect. The auditor would only revise the report to include discussion of the material inconsistency if the client were unwilling to revise the transmittal letter appropriately. Choice â€Å"c† is incorrect.The auditor would only consider withdrawing from the engagement if the client were unwilling to revise the transmittal letter appropriately. Choice â€Å"d† is incorrect. The auditor would not request a client representation letter acknowledging the inconsistency, as correction (and not simply acknowledgment) of the error is desired. 27 2007 AICPA Newly Released Questions – Auditing 28. CPA-05492 An analysis of which of the following accounts would best aid in verifying that all fixed assets have been capitalized? a. b. c. d. Cash. Depreciation expense. Property tax expense. Repairs and maintenance.ANSWER: Choice â€Å"d† is correct. An analysis of the repairs and maintenance account would best aid the auditor in verifying that all fixed assets have been capitalized. This account is generally analyzed to test for completeness of asset additions (i. e. , the auditor is looking for items recorded as repairs or maintenance that would more properly have been capitalized as betterment of an asset). Choice â€Å"a† is incorrect. An analysis of cash would not identify fixed assets that were not properly capitalized, since cash would be paid for the purchase regardless of whether the item were expensed or capitalized.Choice â€Å"b† is incorrect. An analysis of depreciation expense would not identify fixed assets that were not properly capitalized, since no depreciation would be included for items not already classified as assets. Choice â€Å"c† is incorrect. An analysis of property tax e xpense would not identify fixed assets that were not properly capitalized, since no property tax would be included for items not already classified as assets. 28 2007 AICPA Newly Released Questions – Auditing 29. CPA-05493 When companies use information technology (IT) extensively, evidence may be available only in electronic form.What is an auditor's best course of action in such situations? a. b. c. d. Assess the control risk as high. Use audit software to perform analytical procedures. Use generalized audit software to extract evidence from client databases. Perform limited tests of controls over electronic data. ANSWER: Choice â€Å"c† is correct. When companies use information technology (IT) extensively and evidence is available only in electronic form, generalized audit software packages generate the programs necessary to interrogate the files and extract and analyze the data. Choice â€Å"a† is incorrect.The use of information technology does not automat ically imply that control risk is high. The auditor would need to evaluate the client's controls to make this determination. Choice â€Å"b† is incorrect. Although audit software might be used to perform analytical procedures, the data would first need to be extracted from the client's system. A generalized audit software package is the best way to do this. Choice â€Å"d† is incorrect. If information technology is used extensively, the auditor would likely perform more than limited tests of controls over electronic data. 29 2007 AICPA Newly Released Questions – Auditing 30.CPA-05494 The ultimate purpose of assessing control risk is to contribute to the auditor's evaluation of the risk that: a. b. c. d. Specific internal control activities are not operating as designed. The collective effect of the control environment may not achieve the control objectives. Tests of controls may fail to identify activities relevant to assertions. Material misstatements may exist in the financial statements. ANSWER: Choice â€Å"d† is correct. The auditor's ultimate purpose assessing control risk is to evaluate the risk of financial statement misstatement.Choice â€Å"a† is incorrect. The auditor's evaluation of whether or not specific internal control activities are operating as designed is part of his/her assessment of control risk; however, the ultimate purpose of making this assessment is to evaluate the risk of financial statement misstatement. Choice â€Å"b† is incorrect. The auditor's evaluation of the collective effect of the control environment is part of his/her assessment of control risk; however, the ultimate purpose of making this assessment is to evaluate the risk of financial statement misstatement. Choice â€Å"c† is incorrect.Tests of controls are not used to identify activities relevant to assertions. Tests of controls are used to evaluate the operating effectiveness of internal control in preventing or detecti ng material misstatements. 30 2007 AICPA Newly Released Questions – Auditing 31. CPA-05495 After making inquiries about credit granting policies, an auditor selects a sample of sales transactions and examines evidence of credit approval. This test of controls most likely supports management's financial statement assertion(s) of: Rights and obligations Yes Yes No No Allocation and valuation Yes No Yes No a. b. c. d. ANSWER: Choice â€Å"c† is correct.By ensuring that credit approval is obtained before goods are shipped to customers, the auditor is testing management's assertion that accounts receivable are collectible (allocation and valuation). Ensuring that credit approval is obtained before goods are shipped does not support the rights and obligations assertion. Choices â€Å"a†, â€Å"b†, and â€Å"d† are incorrect, based on the above explanation. 31 2007 AICPA Newly Released Questions – Auditing 32. CPA-05496 Which of the following chara cteristics most likely would be an advantage of using classical variables sampling rather than probability-proportional-to-size (PPS) sampling? . b. c. d. The selection of negative balances requires no special design considerations. The sampling process can begin before the complete population is available. The auditor need not consider the preliminary judgments about materiality. The sample will result in a smaller sample size if few errors are expected. ANSWER: Choice â€Å"a† is correct. Inclusion of negative balances requires special design considerations with PPS sampling, but it does not require special design considerations with classical variables sampling. Choice â€Å"b† is incorrect.All items in the population should have an equal chance to be included in the sample. Therefore, the sampling process should not begin before the complete population is available, regardless of whether classical variables sampling or PPS sampling is used. Choice â€Å"c† i s incorrect. When planning a particular sample for a substantive test of details, the auditor should consider preliminary estimates of materiality. Choice â€Å"d† is incorrect. If no errors are expected, PPS sampling generally requires a smaller sample than other methods. 32 2007 AICPA Newly Released Questions – Auditing 33.CPA- 05497 Which of the following matters is an auditor required to communicate to those charged with governance? a. Adjustments that were suggested by the auditor and recorded by management that have a significant effect on the entity's financial reporting process. b. The auditor's consideration of risk factors in assessing the risk of material misstatement arising from the misappropriation of assets. c. The results of the auditor's analytical procedures performed in the review stage of the engagement that indicate significant variances from expected amounts. d.Changes in the auditor's preliminary judgment about materiality that were caused by pro jecting the results of statistical sampling for tests of transactions. ANSWER: Choice â€Å"a† is correct. The auditor is required to communicate significant audit findings to those charged with governance. Significant audit findings include material, corrected misstatements brought to management's attention as a result of the audit. Unless all of those charged with governance are also involved with managing the entity, such findings should be communicated by the auditor. Choice â€Å"b† is incorrect.The auditor is not required to communicate with those charged with governance regarding his/her fraud risk assessment. Choice â€Å"c† is incorrect. The auditor is not required to communicate with those charged with governance regarding the results of specific audit procedures. Choice â€Å"d† is incorrect. The auditor is not required to communicate with those charged with governance regarding changes to his/her preliminary judgment about materiality. 33 2007 AICPA Newly Released Questions – Auditing 34. CPA-05498 For which of the following audit tests would a CPA most likely use attribute sampling? . b. c. d. Identifying entries posted to incorrect accounts. Estimating the amount in an expense account. Evaluating the reasonableness of depreciation expense. Selecting receivables for confirmation of account balances. ANSWER: Choice â€Å"a† is correct. Attribute sampling is used to estimate a rate of occurrence, and often involves a yes-no question. Attribute sampling could be used to determine the error rate in posting journal entries, perhaps by asking, â€Å"Is the entry posted to the proper account? † Choice â€Å"b† is incorrect.Variables sampling is typically used to estimate a numerical quantity, such as the amount in an expense account. Choice â€Å"c† is incorrect. Variables sampling is typically used to estimate a numerical quantity, such as a reasonable amount for depreciation expense. Choice â€Å"d† is incorrect. Attribute sampling is used to estimate a rate of occurrence, not to select the items to include in a sample. 34 2007 AICPA Newly Released Questions – Auditing 35. CPA-05499 Which of the following strategies most likely could improve the response rate of the confirmations of accounts receivable? a. b. c. d.Restrict the selection of accounts to be confirmed to those customers with large balances. Include a list of items or invoices that constitute the customers' account balances. Explain to customers that discrepancies will be investigated by an independent third party. Ask customers to respond to the confirmation requests directly to the auditor by fax. ANSWER: Choice â€Å"b† is correct. The auditor should consider the types of information respondents will be readily able to confirm. For instance, some accounting systems facilitate the confirmation of single transactions rather than entire balances.In such cases, the auditor might conside r including a client-prepared statement of account showing details of the customer's account balance being confirmed. By making it easier for customers to determine which items are included in the balance being confirmed, the auditor also makes it more likely that those customers will respond. Choice â€Å"a† is incorrect. Restricting the selection of accounts to be confirmed to those customers with large balances doesn't improve response rates, as customers with large balances are not necessarily more likely to respond than customers with small balances.Choice â€Å"c† is incorrect. Explaining to customers that discrepancies will be investigated by an independent third party would not necessarily encourage them to respond, as they might be reluctant to set off this investigation. Choice â€Å"d† is incorrect. Responses received by fax should be verified by calling the senders and requesting that the original confirmations be mailed back. Asking customers to res pond by fax might actually reduce the response rate for receiving the original confirmation, since customers may decide that since they already sent the fax, they don't need to send the original back as well. 5 2007 AICPA Newly Released Questions – Auditing 36. CPA-05500 Which of the following procedures would an auditor most likely perform in auditing the statement of cash flows? a. Reconcile the amounts included in the statement of cash flows to the other financial statements' amounts. b. Vouch a sample of cash receipts and disbursements for the last few days of the current year. c. Reconcile the cutoff bank statement to the proof of cash to verify the accuracy of the year-end cash balance. d. Confirm the amounts included in the statement of cash flows with the entity's financial institution.ANSWER: Choice â€Å"a† is correct. To audit the statement of cash flows, the auditor reconciles the amounts on the statement to amounts on other financial statements. Choice â⠂¬Å"b† is incorrect. Vouching a sample of cash receipts and disbursements is a procedure used to audit the cash balance, rather than the statement of cash flows. Choice â€Å"c† is incorrect. Reconciling the cutoff bank statement to the proof of cash to verify the accuracy of the year-end cash balance is a procedure used to audit the cash balance, rather than the statement of cash flows. Choice d† is incorrect. Confirming cash amounts with the entity's financial institution is a procedure used to audit the cash balance, rather than the statement of cash flows. 36 2007 AICPA Newly Released Questions – Auditing 37. CPA-05501 In establishing the existence and ownership of long-term investments in the form of publicly-traded stock, an auditor most likely would inspect the securities or: a. b. c. d. Correspond with the investee company to verify the number of shares owned. Confirm the number of shares owned that are held by an independent custodian.Apply analyti cal procedures to the dividend income and investments accounts. Inspect the cash receipts journal for amounts that could represent the sale of securities. ANSWER: Choice â€Å"b† is correct. Confirmations should be requested from the custodian for securities that are in the possession of third parties. Choice â€Å"a† is incorrect. The investee company may not have timely information regarding the ownership of its stock, nor would an investee typically want to correspond with all of its shareholders in this manner.Choice â€Å"c† is incorrect. Analytical procedures might be used to test the reasonableness of dividend income, but this would not provide evidence about the existence and ownership of the investments. Choice â€Å"d† is incorrect. Inspecting the cash receipts journal for amounts that could represent the sale of securities might provide evidence regarding sales (and gains or losses on sales), but would not provide evidence about the existence a nd ownership of the investments. 37 2007 AICPA Newly Released Questions – Auditing 38.CPA-05502 The standard report issued by an accountant after reviewing the financial statements of a nonpublic entity should state that: a. A review is limited to presenting in the form of financial statements information that is the representation of management. b. A review consists of inquiries of company personnel and analytical procedures applied to financial data. c. The accountant does not express an opinion or any other form of assurance on the financial statements. d. The accountant did not obtain an understanding of the entity's internal control or assess control risk. ANSWER: Choice â€Å"b† is correct.The standard report issued by an accountant after reviewing the financial statements of a nonpublic entity states that a review consists of inquiries of company personnel and analytical procedures applied to financial data. Choice â€Å"a† is incorrect. A compilation rep ort uses language similar to this, stating that a compilation is limited to presenting, in the form of financial statements, information that is the representation of management. Choice â€Å"c† is incorrect. A compilation report uses language similar to this, stating that the accountant does not express an opinion or any other form of assurance on the financial statements.A review provides negative assurance. Choice â€Å"d† is incorrect. While it is true that a review of the financial statements of a nonpublic entity does not require the accountant to obtain an understanding of the entity's internal control or assess control risk, the report does not explicitly state this. 38 2007 AICPA Newly Released Questions – Auditing 39. CPA-05503 When an accountant compiles projected financial statements, the accountant's report should include a separate paragraph that: a. b. c. d. Explains the difference between a compilation and a review.Documents the assessment of the risk of material misstatement due to fraud. Expresses limited assurance that the actual results may be within the projected range. Describes the limitations on the projection's usefulness. ANSWER: Choice â€Å"d† is correct. The accountant's report on compiled projected financial statements should include a separate paragraph that describes the limitations on the projection's usefulness. For example, the paragraph states that there will usually be differences between projected and actual results, and indicates that the accountant has no responsibility o update the report for events occurring after the date of the report. Choice â€Å"a† is incorrect. The accountant's report on compiled projected financial statements does not include an explanation of the difference between a compilation and a review. Choice â€Å"b† is incorrect. The accountant's report on compiled projected financial statements does not document the assessment of the risk of material misstatem ent due to fraud. Choice â€Å"c† is incorrect. The accountant's report on compiled projected financial statements does not express limited assurance that the actual results may be within the projected range.In fact, it specifically states that no opinion or any other form of assurance is expressed, and that there usually will be differences between projected and actual results. 39 2007 AICPA Newly Released Questions – Auditing 40. CPA-05504 (Adapted) An auditor intends to use the work of an actuary who has a relationship with the client. Under these circumstances, the auditor: a. b. c. d. Is required to disclose the contractual relationship in the auditor's report. Should assess the risk that the actuary's objectivity might be impaired. Is not permitted to rely on the actuary because of a lack of independence.Should communicate this matter to those charged with governance as a significant deficiency in internal control. ANSWER: Choice â€Å"b† is correct. While a specialist who is unrelated to the client will provide the auditor with greater assurance of reliability, a specialist who is related to the client may be acceptable in certain circumstances. In such situations, the auditor would likely perform additional procedures to verify objectivity. Choice â€Å"a† is incorrect. If the auditor is expressing a standard unqualified opinion, no reference would be made to the specialist in the auditor's report.Choice â€Å"c† is incorrect. While a specialist who is unrelated to the client will provide the auditor with greater assurance of reliability, a specialist who is related to the client may be acceptable in certain circumstances. Choice â€Å"d† is incorrect. The fact that the actuary has a relationship with the client is not considered to be a significant deficiency in internal control. 40 2007 AICPA Newly Released Questions – Auditing 41. CPA-05505 Before applying principal substantive tests to an entity's ac counts receivable at an interim date, an auditor should: a. b. c. d.Consider the likelihood of assessing the risk of incorrect rejection too low. Project sampling risk at the maximum for tests covering the remaining period. Ascertain that accounts receivable are immaterial to the financial statements. Assess the difficulty in controlling the incremental audit risk. ANSWER: Choice â€Å"d† is correct. When audit procedures are performed before year-end, the auditor must assess the incremental risk involved and determine whether sufficient alternative procedures exist to extend the interim conclusions to year-end. Choice â€Å"a† is incorrect.The risk of incorrect rejection relates to the efficiency of audit testing, since an item that is initially (and erroneously) rejected will be subject to additional audit testing that should correct the error. The likelihood of assessing this risk lower than it should be does not affect the auditor's decision regarding the appropria te timing of audit work. Choice â€Å"b† is incorrect. When audit procedures are performed before year-end, the auditor must assess the incremental risk involved, but this risk would not necessarily be assessed at the maximum level. Choice â€Å"c† is incorrect.Interim testing may be performed on material accounts, as long as the auditor assesses the incremental risk involved and determines whether sufficient alternative procedures exist to extend the interim conclusions to year-end. Immaterial accounts would not need to be tested. 41 2007 AICPA Newly Released Questions – Auditing 42. CPA-05506 (Adapted) Which of the following procedures would a CPA most likely perform in the planning stage of a financial statement audit? a. b. c. d. Obtain representations from management regarding the availability of all financial records.Communicate with those charged with governance concerning the prior year's audit adjustments. Make inquiries of the client's attorney regardi ng pending and threatened litigation and assessments. Compare recorded financial information with anticipated results from budgets and forecasts. ANSWER: Choice â€Å"d† is correct. The planning process should include application of analytical procedures, such as comparison of the financial statements with budgeted or anticipated results. Choice â€Å"a† is incorrect. Management representations are typically obtained at the end of the audit, not during the planning stage. Choice â€Å"b† is incorrect.Assuming all of those charged with governance are not also involved with managing the entity, the auditor is required to communicate with those charged with governance concerning adjustments arising from the current year's audit, not adjustments from the previous year. Choice â€Å"c† is incorrect. Inquiries are typically made of the client's attorney during the fieldwork stage of the audit, not during the planning stage. 42 2007 AICPA Newly Released Question s – Auditing 43. CPA-05507 A CPA is engaged to examine management's assertion that the entity's schedule of investment returns is presented in accordance with specific criteria.In performing this engagement, the CPA should comply with the provisions of: a. b. c. d. Statements on Standards for Accounting and Review Services (SSARS). Statements on Auditing Standards (SAS). Statements on Standards for Consulting Services (SSCS). Statements on Standards for Attestation Engagements (SSAE). ANSWER: Choice â€Å"d† is correct. Statements on Standards for Attestation Engagements apply to engagements in which a practitioner is engag