10/11/23,
5:34
PM
Lesson
04
Quiz:
ACC
450:
Principles
of
Auditing
(2023
Fall
-
B)
Lesson
04
Quiz
Due
Oct
17
at
11:59pm
Points
10
Questions
10
Available
until
Oct
17
at
11:59pm
Time
Limit
None
Allowed
Attempts
Unlimited
Instructions
Some,
but
not
all,
of
the
responses
have
explanations
for
why
they
are
correct
or
incorrect.
Click
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the
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to
begin.
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attempt:
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10
Submitted
Oct
11
at
5:33pm
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attempt
took
less
than
1
minute.
Question
1
1/1
pts
Which
of
the
following
examples
illustrates
the
need
for
audits
of
financial
statements
best?
https://canvas.asu.edu/courses/159839/quizzes/1199882
1/8
10/11/23,
5:34
PM
Lesson
04
Quiz:
ACC
450:
Principles
of
Auditing
(2023
Fall
-
B)
|
Correctl
A
potential
investor
into
a
company
would
like
to
have
some
assurance
that
the
company’s
financial
statements
can
be
relied
upon
for
making
investment
decisions.
"
Nice
job!
Review
pages
55-56
of
the
text
for
information
on
why
-
auditing
financial
statements
is
important.
Now
get
back
to
work.
A
potential
investor
into
a
company
would
like
to
have
some
assurance
that
if
their
investment
loses
value,
they
will
be
able
to
recover
at
least
some
of
their
investment.
A
potential
creditor
of
a
company
would
like
someone
to
guarantee
the
loans
that
could
be
provided
to
the
company.
All
of
the
above
illustrate
the
need
for
audits
of
financial
statements
equally
well.
Question
2
1/1
pts
Which
of
the
following
is
considered
to
be
the
first
step
in
the
audit
process?
Planning
the
audit
work
Correct!
)
Signing
the
engagement
letter
"
Nice
job!
This
is
when
the
auditor
makes
an
agreement
with
the
client
|
-
to
audit
their
company,
starting
the
audit
process.
Review
the
-
process
diagram
on
page
57
in
the
text.
Now
get
back
to
work.
Understanding
the
client
and
its
business
https://canvas.asu.edu/courses/159839/quizzes/1199882
2/8
10/11/23,
5:34
PM
Correctl
Lesson
04
Quiz:
ACC
450:
Principles
of
Auditing
(2023
Fall
-
B)
None
of
the
above
Question
3
171
pts
Which
of
the
following
is
true
about
the
planning
the
audit
work
stage
of
the
audit
process?
This
stage
tends
to
span
several
stages
of
the
audit
process
Substantial
portion
of
this
stage
is
performed
after
the
stage
Understand
the
client
and
its
business
Auditors
tend
to
update
their
initial
plans
throughout
the
audit
process,
as
new
information
comes
in
)
All
of
the
above
(
~
Nice
job!
Review
pages
58-60
of
the
text
for
information
on
the
~
planning
stage
of
the
audit
process.
Now
get
back
to
work.
Question
4
1/1
pts
Which
of
the
following
characterizes
the
components
of
Audit
Risk
formula
best?
Inherent
and
detection
risks
do
not
depend
on
auditors
and
have
to
be
assessed,
but
control
risk
component
is
decided
upon
(rather
than
assessed
or
measured)
by
auditors
depending
on
how
high
audit,
inherent,
and
detection
risks
are
https://canvas.asu.edu/courses/159839/quizzes/1199882
3/8
10/11/23,
5:34
PM
Lesson
04
Quiz:
ACC
450:
Principles
of
Auditing
(2023
Fall
-
B)
|
Correctl
Inherent
and
control
risks
do
not
depend
on
auditors
and
have
to
be
assessed,
but
detection
risk
component
is
decided
upon
(rather
than
assessed
or
measured)
by
auditors
depending
on
how
high
audit,
inherent,
and
control
risks
are
"
Nice
job!
Review
pages
58-60
of
the
text
for
information
on
the
audit
-
risk
formula
and
each
component.
Now
get
back
to
work.
All
three
component
risks—inherent,
control,
and
detection—do
not
depend
on
auditors
and
have
to
be
assessed
or
measured
(rather
than
decided
upon
by
auditors)
All
three
component
risks—inherent,
control,
and
detection—are
decided
upon
by
auditors
(rather
than
assessed
or
measured)
Question
5
1/1
pts
When
Audit
Risk
is
very
low,
while
Inherent
Risk
and
Control
Risk
are
very
high,
which
of
the
following
will
likely
be
true
about
Detection
Risk?
Correctl
)
It
will
likely
be
very
low
——
i
Nice
job!
Review
pages
58-60
of
the
text
for
information
on
the
audit
-
risk
formula
and
the
relationship
between
each
component.
Now
get
back
to
work.
It
will
likely
be
very
high
It
is
impossible
to
tell
given
this
information
This
question
misses
the
point
because
in
this
scenario
auditors
will
most
likely
quit
https://canvas.asu.edu/courses/159839/quizzes/1199882
4/8
10/11/23,
5:34
PM
Correctl
Lesson
04
Quiz:
ACC
450:
Principles
of
Auditing
(2023
Fall
-
B)
Question
6
1/1
pts
Which
of
the
following
is
true
about
auditors’
testing
of
ICFR
for
operating
effectiveness
at
non-public
audit
clients?
Auditors
never
test
ICFR
for
operating
effectiveness
at
non-public
audit
clients
Auditors
always
test
ICFR
for
operating
effectiveness
at
non-public
audit
clients
Auditors
test
ICFR
for
operating
effectiveness
at
non-public
audit
clients
only
when
those
clients are
about
to
go
public
)
None
of
the
above
——
é
Nice
job!
Review
pages
60-61
of
the
text
(the
section
covering
-
rectangle
4,
testing
the
operating
effectiveness
of
internal
controls),
and
when
to
test
ICFR
for
operating
effectiveness.
Now
get
back
to
|
!
work.
e
e
Question
7
1/1pts
Which
of
the
following
is
incorrect
about
how
audits
of
private
and
public
companies
differ
in
the
US?
Audits
of
public
companies
are
based
on
the
PCAOB’s
guidance
https://canvas.asu.edu/courses/159839/quizzes/1199882
5/8
10/11/23,
5:34
PM
Lesson
04
Quiz:
ACC
450:
Principles
of
Auditing
(2023
Fall
-
B)
|
Correctl
Audits
of
public
and
private
companies
are
required
to
produce
an
audit
opinion
on
operating
effectiveness
of
ICFR
in
addition
to
an
audit
opinion
on
financial
statements
"
Nice
job!
Private
companies
are
not
required
to
produce
an
audit
l
opinion
on
operating
effectiveness
of
ICFR.
Review
pages
62-63
of
-
the
text
for
information
on
how
private
and
public
company
audits
-
differ.
Now
get
back
to
work.
Audits
of
private
companies
are
based
on
the
AICPA’s
guidance
Audits
of
public
companies,
but not
audits
of
private
companies,
are
required
to
produce
an
audit
opinion
on
operating
effectiveness
of
ICFR
in
addition
to
an
audit
opinion
on
financial
statements
Question
8
171
pts
Which
of
the
following
components
of
Audit
Risk
formula
do
auditors
control
by
deciding
what
it
is?
Correctl
)
Audit
Risk
and
Detection
Risk
——
Nice
job!
Audit
Risk
is
determined
by
the
auditor
and
Detection
Risk
is
a
plug-in
based
on
the
accepted
audit
risk.
Review
page
63
of
the
e
———————————————————
text
for
information
on
the
Audit
Risk
formula.
Now
get
back
to
work.
Inherent
Risk
Control
Risk
None
of
the
above
https://canvas.asu.edu/courses/159839/quizzes/1199882
6/8
10/11/23,
5:34
PM
Lesson
04
Quiz:
ACC
450:
Principles
of
Auditing
(2023
Fall
-
B)
Question
9
1/1
pts
Which
of
the
following
best
describes
how
audits
of
financial
statements
differ
worldwide?
A.
While
audits
in
the
U.S.
require
reasonable
assurance,
audits
in
Europe
require
absolute
assurance.
B.
Audits
in
the
U.S.
are
generally
conducted
under
the
standards
developed
by
the
PCAOB
or
by
the
AICPA.
C.
Audits
outside
of
the
U.S.
are
generally
not
conducted
under
the
standards
developed
by
the
PCAOB
or
by
the
AICPA
Correct!
)
BandC.
Nice
job!
Review
page
64
of
the
text
for
information
on
how
audits
of
financial
statements
differ
worldwide.
Now
get
back
to
work.
Recall:
U.S.
Audits
-
PCAOB
and/or
AICPA
"
International
-
IAASB
Question
10
1/1
pts
Which
of
the
following
is
the
best
practice
in
learning
about
audit
guidance?
https://canvas.asu.edu/courses/159839/quizzes/1199882
7/8
10/11/23,
5:34
PM
Lesson
04
Quiz:
ACC
450:
Principles
of
Auditing
(2023
Fall
-
B)
When
you
are
a
full-time
auditor,
you
should
set
aside
some
time
each
day
to
learn
about
audit
guidance
While
you
are
a
full-time
undergraduate
student,
you
should
set
aside
some
time
each
day
to
learn
about
audit
guidance,
if
you
are
planning
to
work
as
an
auditor
Correct!
®
When
you
are
a
full-time
auditor,
you
should
learn
only
the
audit
guidance
that
is
pertinent
to
the
task
to
which
you
are
assigned
"
Nice
job!
Review
page
64
of
the
text
for
information
on
best
practices
~
of
learning
about
audit
guidance.
Now
get
back
to
work.
When
you
are
a
full-time
auditor,
you
do
not
need
to
learn
about
audit
guidance
because
audit
program
will
specify exactly
what
needs
to
be
done
Quiz
Score:
10
out
of
10
https://canvas.asu.edu/courses/159839/quizzes/1199882
8/8
