Month: September 2025

Which ONE of the following does NOT constitute analytical procedures?

Select ONE answer:

1. Consideration of comparable information for prior periods
2. Consideration of relationships between elements of financial information that are expected to conform to a predicted pattern
3. Consideration of whether a balance has been calculated correctly
4. Consideration of similar industry information

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 == >    The answer is 3 as consideration of whether a balance has been correctly calculated will require a procedure of recalculation as opposed to an analytical procedure.
4. Not correct

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With respect to ISA 315 (UK), Identifying and Assessing the Risks of Material Misstatement Through Understanding of the Entity and Its Environment, which ONE of the following procedures will NOT be used in understanding the entity and its environment?

Select ONE answer:

1. Inquiries of management and others within the entity
2. Inquiries of third parties
3. Analytical procedures
4. Observation and inspection

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 == > The standard states that inquiries of third parties may be carried out if useful, but lists options 1, 3 and 4 as procedures that SHALL be carried out.
3. Not correct
4. Not correct

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Which ONE of the following is not an objective of audit planning?

Select ONE answer:

1. To determine the scope of the engagement
2. To ensure appropriate attention is devoted to the important areas of the audit
3. To identify potential problems and resolve them on a timely basis
4. To assign work to members of the audit team

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 == > The answer is not option 1 as to determine the scope of the engagement should have been done in the engagement letter.
2. Not correct
3. Not correct
4. Not correct

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

Which one of the following best describes professional scepticism – The assurance provider should?

Select ONE answer:

1. apply a questioning mind to the information and evidence he obtains
2. not believe anything that management tells him
3. not believe anything that management tells him, without obtaining supporting evidence
4. always assume the worst outcome in cases of uncertainty

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 == > Apply a questioning mind to the information and evidence he obtains would indicate professional scepticism. The alternative options offered are all a step too far.
2. Not correct
3. Not correct
4. Not correct

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

Which ONE of the following is NOT a purpose of a letter of engagement?

Select ONE answer:

1. Setting out the form of any report to be issued
2. Documenting and confirming acceptance of the appointment
3. Narrowing the expectations gap
4. Providing evidence on matters where other evidence is not expected to exist

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 following are NOT purposes of an engagement letter: providing constructive suggestions to management concerning improvements to internal control & providing evidence on matters where other evidence is not expected to exist (e.g., on management plans for the future of the entity) – this is the purpose of a written representation.

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