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Auditing MCQ 100
Auditing MCQ 100
Auditor
50 Solved MCQ’s
By
1. The main objective of
financial audit is________
a) Expression of opinion
b) Detection and prevention of fraud and error
c) Designing internal control system
d) All of these
2. Auditor gives ________
regarding the financial statements
a) Non-profit-organizations
b) Business
c) Governments
d) All of the above
5. Auditing should be
a) Independent
b) Compulsory
c) On the request of government
d) None of the above
6. Independence
comprises
a) Independence by mind
b) Independence in appearance
c) Both (a) and (b)
d) None of these
7. If auditor maintains high degree
of independence, it will result in
a) Attention of media
b) Reward by CG
c) Enhanced reliability on financial statements
d) Good relationship with the entity.
8. Auditor should have
knowledge of
A) Accounting
b) Auditing
c) Law applicable on the entity
d) All of these
9. Auditor should have
communication skills in following
areas:
a) Oral skills
b) Written skills
c) Both (a) and (b)
d) He does not require any communication skills
10. Function of audit is
to
a) Detect errors
b) Detect fraud
c) Safeguard the interest of stakeholders
d) All the above
11. Which is NOT the
function of an auditor?
a) To give a true and fair view
b) To take care of all the statutory acts
applicable
c) To do arithmetic checking
d) To prepare accounts
D
12. The basic requirement
which is absent is auditing is
a) Exact accounts
b) Certainty in financial statements
c) Conclusive evidence
d) All of the above
D
13. Which of the following
statement is not true
a) The auditor shall express an opinion on financial statements
b) Auditor’s opinion is not guarantee to future viability of
business c) Auditor is responsible for prevention and detection
of fraud and error in financial statements
d) Auditor should examine whether recognized accounting
principles have been followed
C
14. Auditor should be
done by
a) A professional accountant
b) A certified management accountant
c) A competent and independent person
d) A chartered accountant
C
15. Which of the following is least
likely to be required in an audit?
D
17. Auditing has all
features except
a) Done every financial year
b) Based on conclusive evidence
c) Mandatory for companies
d) None of the above
B
18. The primary objective of the
ordinary examination of financial
statement by an auditor is the
expression of an opinion on
a) The competence of management in accounting matters
which is implied by whether the opinion is qualified or not
b) The conformity of the statements with the book of
account
c) The conformity of the financial statements with generally
accepted auditing standards applied on a basis consistent
with that of the prior year
D
d) The fairness with which the financial statements present
cash flows and results of operations
19. The principal objective of an audit is the
examination of financial statements of an enterprise
with a view for the auditor to form and express an
independent opinion on the truth and fairness for
the benefit of which one of the following?
a) The members
b) Corporate Governance
c) The Corporate Affairs Commission
d) Government authorities
A
20. The factor which
distinguishes an error from
fraud and other irregularity
is
a) Whether it is a caused by officer of the entity or
employee of the entity
b) Intention
c) Materiality
d) Whether it is caused by the auditor or the client
D
21. Which of the following
statement is TRUE?
a) An external auditor is required for all
types of entity b) External auditors are
appointed by an entity’s management
c) Staff auditors make a report for the
baseline employees d) Staff auditors
work is to identify potential risk areas
for a company
D
22. Pick the odd one
D
23. Pick the odd one C
a) Preparation of financial statements
b) Designing, implementation and maintenance of
internal control system
c) Reporting on true and fair view of financial
statements
d) Compliance with the applicable law and regulation
A
d) Any entity
A
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