The Multiple Choice Questions Blog

Which ONE of the following is a purpose of a written representation letter?

Select ONE answer:

1. Provision of evidence in respect of material items where other evidence is available
2. Confirmation by management of the scope of the work to be carried out by the assurance Firm
3. Provision of details of proposed modifications to the auditor’s report
4. Acknowledgement by management of its belief that the aggregate of uncorrected misstatements is immaterial to the financial statements

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – The two purposes of the written representation letter are: (1) acknowledgment that management has fulfilled its responsibility for preparing the financial statements, and (2) acknowledgment by management that it believes the aggregate of uncorrected misstatements is immaterial to the financial statements. Where other evidence is available on a matter, the written representation letter does not serve as audit evidence. Management’s confirmation of the scope of work to be carried out is included in the engagement letter.

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For the following statement concerning written representations letters, select whether it is of no relevance, depends on the type of business, true or false.

Written representations can be used as a substitute for evidence which would be available to the auditor by other means.

Select ONE answer:

1. True
2. No relevance
3. False
4. Depends on the type of business

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct – Written representations cannot be used as a substitute for other evidence that is expected to be available.
4. Not correct

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For the following statement concerning written representations letters, select whether it is of no relevance, depends on the type of business, true or false.

• The matters to be referred to in the written representation letter shall be discussed by the auditor with senior management.

Select ONE answer:

1. False
2. True
3. No relevance
4. Depends on the type of business

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct – It is usually only of senior management that auditors request written representations as they are responsible for matters of judgement, cooperating with the auditors etc.
3. Not correct
4. Not correct

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For the following statement concerning written representations letters, select whether it is of no relevance, depends on the type of business, true or false.

• Written confirmations are required from all client staff who have made oral representations.

Select ONE answer:

1. False
2. No relevance
3. Depends on the type of business
4. True

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – It is usually only of senior management that auditors request written representations as they are responsible for matters of judgement, cooperating with the auditors etc.
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

For the following statement concerning written representations letters, select whether it is of no relevance, depends on the type of business, true or false.

• The written representation letter must include a list of all uncorrected misstatements.

Select ONE answer:

1. No relevance
2. False
3. Depends on the type of business
4. True

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – The written representation letter must include a list of all uncorrected misstatements. It shall also include a statement that the directors believe the total of uncorrected misstatements to be immaterial to the financial statements as a whole.

This work is licensed under a Creative Commons Attribution 4.0 International License.