Auditing MCQs

Question 1

"Cost Audit" means:

Accepted Answer

Audit of Cost Account

Answer

Audit by a Cost Accountant

Answer

Auditing the Cost of Goods produced

Answer

None of these

Question 2

Floating assets are valued at:

Accepted Answer

Cost or market price whichever is lower

Answer

Cost

Answer

Market price

Answer

Cost less depreciation

Question 3

"Disclaimer of Opinion" is issued, when the Auditor is-

Accepted Answer

in disagreement with the records kept by the management

Answer

unable to frame an opinion

Answer

not in an agreement with the stand taken by the management in respect of a material issue

Answer

None of these

Question 4

For all audits of financial statements made in accordance with AAS14, the use of analytical procedures is at the discretion of the auditor in which stage?

Accepted Answer

Substantive testing

Answer

Planning stage

Answer

Overall review stage

Answer

All of the above

Question 5

Internal auditor is appointed by:

Accepted Answer

Board of Directors

Answer

Shareholders

Answer

Statutory auditor

Answer

Institute of Internal Auditors of India

Question 6

The performance of tests of control is documented in:

Accepted Answer

Working papers

Answer

Audit programme

Answer

Flow charts

Answer

Any of the above

Question 7

An auditor is like a:

Accepted Answer

Watch dog

Answer

Blood haunt

Answer

May both according to situation

Answer

None of these

Question 8

Which among the following is not associated with an advantage of audit?

Accepted Answer

Answer

Correct settlement of claim from the insurance company

Answer

Borrowings from the banks made easy

Answer

Income tax authority generally accepts the audited accounts to be correct

Answer

It facilitates the settlement of the accounts of a deceased partner

Question 9

Which of the following is not the duty of a company auditor:

Accepted Answer

To physically verify the value of stock in hand at the close of the year

Answer

To make a report to the members of the company on the accounts examined by him

Answer

To enquire whether loans and advances made by the company on the basis of security have been properly secured

Answer

Where it is stated in the books of the company that shares have been allotted for cash, to enquire whether cash has actually been received in respect of such allotment