Answers are provided at the bottom of this document.

Questions

1. When is there sufficient audit evidence?
   
   1. when it substantiates the auditor's conclusion
   2. when the allotted time has been utilized
   3. when there is more evidence than was documented in previous years
   4. when 100% of the transactions have been tested
2. The demand for independent audits is now much greater than 50 years ago because of increased information risks. The following are possible factors that increase the likelihood that unreliable information will be provided, EXCEPT:
   
   1. the use of estimates
   2. voluminous data
   3. complex transactions
   4. the cost of information
3. A large amount of audit time is usually spent on cash transactions audits, EXCEPT for which of the following:
   
   1. cash is the end result of most transactions
   2. cash is susceptible to misappropriation
   3. it is expected that cash balances should be more precisely determined than other accounting figures
   4. all cash is deposited by the business into its bank account
4. Why do we need (audited) financial statements?
   
   1. to show details of revenues and expenses
   2. to provide fair, objective and independent opinions
   3. to identify who the shareholders are
   4. to summarize computer books and records
5. Unaudited financial statements may not be reliable because:
   
   1. they include economic data
   2. they are based on historical data
   3. the target audience includes shareholders
   4. the level of assurance provided is lower than in an audit
6. As a CRA auditor, which of the following would you consider the most authoritative source of guidance?
   
   1. Ontario Securities Commission (OSC) guidelines
   2. Canadian Institute of Chartered Accountants (CICA) handbook
   3. Securities and Exchange Commission (SEC) guidelines
   4. International Federation of Accountants (IFAC) guidelines

Answers

1. a
2. d
3. d
4. b
5. d
6. b