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    2K views10 pages

    Auditing Sem VI MCQs

    Uploaded by

    Mayur Padave

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    of 10

    Q1 – Ans is © Board of Dir

    Q2. Ans is (a) 15 days

    Q3 Ans is (b) Conclusion of 1st agm

    Q4. (a) BOD within 30 days

    5. Who is responsible for the appointment of statutory auditor of a limited company?

    A. Directors of the company. B. Members of the company. C. The central government. D. The state government.

    Ans:B

    6. Which of the following statement is not true?

    A Partnership firm can be appointed as a statutory auditor of limited company.


    B. Appointment can be made in the name of the firm.
    C. Majority of the partners should be practicing in India.
    D. All partners should be chartered account.

    Ans:C

    7. The board of directors shall appoint first auditor of a company ___________.

    A. Within one month of completion of capital subscription state of the company.


    B. Within one month of the promotion of the company.
    C. Within one month of the commencement of the business of the company.
    D. Within one month of incorporation of the company.

    Ans;D
    8. In case the directions fail to appoint first auditors, the shareholders shall appoint them at _______ by passing a
    resolution.

    A. A general meeting. B. First annual general meeting. C. Statutory meeting. D. Annual general meeting.

    Ans:A

    9. The auditor of a government company is appointed by the C & AG. His remuneration is fixed by _____________.

    A. The C & AG.


    B. The shareholders.
    C. The shareholders at an annual general meeting.
    D. The board of directors.

    Ans:B

    10. The authority to remove the first auditor before the expiry of term is with ___________.

    A. The shareholders in a general meeting.


    B. The shareholders in the first annual general meeting.
    C. The board of directors.
    D. The central government.

    Ans:A

    11. Which of the following statement is not correct regarding removal of first auditor before expiry of the term?

    A. He is removed at a general meeting.


    B. The shareholders are authorized to do so.
    C. The approval of the central government is required for such removal.
    D. The provision for such removal are contained in section 224(7).

    Ans:C

    12. The retiring auditor does not have a right to _________.

    A. Make written representations.


    B. Get his representation circulated.
    C. Be heard at the meeting.
    D. Speak as a member of the company

    Ans:D

    13. A statutory auditor has a right of access at all times to ___________.

    A. Books and accounts of a company.


    B. Books, account and documents of the company.
    C. Books, accounts and vouchers of the company.
    D. Notices and documents of the company

    Ans:C

    14. Who among the following can be appointed as special auditor by the central government?

    A. The statutory auditor.


    B. Chartered accountant in practice.
    C. Any chartered accounted who is not in practice.
    D. Both (1) and (2).

    Ans:B
    15. Who among the following is eligible to be appointed as an audit of Government Company?

    A. A chartered accountant in practice.


    B. A chartered accountant whether in practice or not.
    C. An auditor appointed by the A & AG.
    D. An unsound mind person

    Ans:A

    16. The statutory auditor of a Government Company submits his report to _________.

    A. The BOD of the company


    B. The C & AG.
    C. The legislature.
    D. The company secretary

    Ans:B

    17. A good audit report must at least meet one of the following qualifications __________.

    A. It should offer constructive and timely suggestions to the management.


    B. It should not point out mistakes.
    C. It should not be based on factual information.
    D. It should not be based on balance sheet.

    Ans:A

    18. The owners of the company are called __________.

    A. Debenture holders. B. Debtors. C. Shareholders. D. None of the above.

    Ans:C

    19. Verification is __________.

    A. the art of recording the business transaction.

    B. an examination of the books of accounts.

    C. the act of establishing the accuracy of entries in the books of accounts.

    D. none of the above.

    Ans:C

    20. The first auditors appointed hold office ____________.

    A. For a period of one year.

    B. For a period of two years.

    C. For a period of three years.

    D. Till the conclusion of the first annual general meeting.

    Ans:D
    21. Audit of company account is _____________.

    A. Compulsory. B. Unnecessary. C. Avoidable. D. Depends upon directors

    Ans:A

    22. The company's auditor is expected to give _____________.

    A. His expert opinion about the accounts. B. A factual position about the accounts. C. A critical review of the accounts. D. Financial
    assistance.

    Ans:A

    23. Internal auditor of a company must be _______________.

    A. Cost accountant. B. Chartered accountant. C. ICWA. D. Need not possess any professional qualification.

    Ans:B

    24. Auditors of a joint stock company are appointed by ______________.

    A. Directors of the company. B. Annual general meeting. C. Election at the annual general meeting. D. Debenture holders.

    Ans:B

    25. A company auditor can be removed by _________________.

    A. Board of directors. B. Managing director. C. Any director. D. General meeting

    Ans:D

    26. A vacancy caused by resignation of an auditor is filled by _________.

    A. Board of directors. B. Managing director. C. General meeting. D. Central government

    Ans:C

    27. When issuing unqualified opinion the auditor who evaluated the audit findings should be satisfied that the
    ______________.

    A. Amount of known misstatement is documented in working papers


    B. Estimates of the total likely misstatement is less than materiality level.
    C. Estimated of the total likely misstatement is more than materiality level.
    D. Estimates of the total likely misstatement cannot be made

    Ans:B

    28. __________ is a systematic examination of the books and records or a business.

    A. Auditing. B. Vouching. C. Verification. D. Checking.

    Ans:A

    29. An audit which is compulsory by the law __________.

    A. Government audit. B. Internal audit. C. Cost audit. D. Statutory audit.

    Ans:D

    30. Instruction of audit issued by controller and auditor general of India ________.

    A. Statutory audit. B. Final audit. C. Management audit. D. Government audit.

    Ans:D
    31. A number of checks and controls exercised in a business to ensure its efficient working is known as ________.

    A. Internal check. B. Internal control. C. Internal audit. D. Interim check.

    Ans:B

    32. The main object of the audit of the cash book may be ________.

    A. To verify the assets and liabilities. B. To know that all receipts and payments have been properly recorded. C. To check the
    internal control system in business. D. To check the bank balance.

    Ans:B

    33. The purpose of the audit of wage payment is to determine that __________.

    A. The work is executed completely for which the workers are paid wages.
    B. The workers are paid the correct amount of wages under proper authorization.
    C. The workers are working regularly.
    D. None of the above

    Ans:B

    34, One of the audit procedures to check the issue of share capital of the newly formed company is __________.

    A. The memorandum of association and articles of association. B. The share transfer register. C. The issue of debenture. D. None
    of the above.

    Ans:A

    35. Fundamentally, the auditor report gives an opinion on whether the financial statements
    (A) are in accordance with the national standards
    (B) are in accordance with the international standards
    (C) have errors, mistakes, or fraud
    (D) present fairly the position and results of an entity

    Ans : D

    36. The _____ certify or guarantee that the financial statements are correct.
    (A) management
    (B) board of governors
    (C) auditor
    (D) auditor does not

    Ans : D

    4. IAASB is an abbreviation for


    (A) International Accounting and Auditing Standards Board
    (B) International Accountants and Auditors Standards Board

    (C) International Auditing and Assurance Standards Board


    (D) International Accounting and Assurance Standards Board

    Ans : C

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