Chapter 3
Chapter 4
Chapter 5
Chapter 6
Chapter 7
100
The amount of planning materiality that is allocated to a financial statement account.
What is tolerable misstatement?
100
The risk that the auditor expresses an inappropriate audit opinion when the financial statements are materially misstated.
What is audit risk?
100
Includes observation, inquiry, scanning, recalculation, confirmation.
What are audit procedures for obtaining audit evidence?
100
An auditor might test controls at an ________ date because the assertions being tested may not be significant, the control has been effective in prior audits, or it may be more efficient to conduct the tests at that time.
What is interim?
100
A deficiency, or combination of deficiencies, in ICFR, such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statement will not be prevented or detected on a timely basis.
What is a material weakness?
200
Tests of transactions that both evaluate the effectiveness of controls and detect monetary errors.
What are dual-purpose tests?
200
This risk has an inverse relationship to inherent risk and control risk.
What is detection risk?
200
The measure of the quantity of audit evidence.
What is sufficiency?
200

Control environment, entity's risk assessment process, the information system and related business processes relevant to financial reporting and communication, control activities, and monitoring of controls (CRIME).

What are the five components of internal control?

200
This section of the Sarbanes-Oxley Act requires the auditor to audit management's assertion about the effectiveness of ICFR.
What is Section 404?
300
A letter that formalizes the contract between the auditor and the client and outlines the responsibilities of both parties.
What is an engagement letter?
300

IR x CR

What is the risk of material misstatement?

300
Management assertion about classes of transactions and events for the period which indicates that all transactions and events have been recorded in the correct accounting period.
What is cutoff?
300
A __________________ audit strategy means that the auditor has decided not to rely on the entity's controls and instead use substantive procedures as the main source of evidence about the assertions in the financial statements.
What is substantive?
300
In judging the significance of a control deficiency, management and the auditor must consider two dimensions of the control deficiency: ____________ and ______________.
What are likelihood and magnitude?
400
Each member of this group must be a member of the board of directors and shall be independent.
What is the audit committee?
400
Consists of opportunity, attitudes/rationalization, and incentive.
What is the fraud triangle?
400
Includes trend analysis, ratio analysis, and reasonableness analysis.
What are analytical procedures?
400
Performance reviews, information processing controls, including authorization and document-based controls, physical controls, segregation of duties.
What are the four types of control activities?
400
__________________ is the process of correcting a material weakness as part of management's assessment of the effectiveness of ICFR.
What is remediation?
500
The auditor's plan for the expected conduct, organization, and staffing of the audit.
What is the audit strategy?
500

Information that has an impact on the decision-making of the users of the financial statements.

What is materiality?

500
The ____________________ of evidence is influenced by its source and by its nature and is dependent on the individual circumstances under which it is obtained.
What is reliability?
500
A _________________ provides a diagrammatic representation, or "picture" of the accounting system.
What is a flowchart?
500
This type of audit opinion, while an option for the financial statement audit opinion, is not an option for the auditor's opinion on the effectiveness of ICFR.
What is a qualified opinion?
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