Question 1

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The firm should establish policies and procedures requiring appropriate doc-
umentation to provide evidence of the operation of each element of its system
of quality control. How such matters are documented is based on

a.
The firm’s decision
b.
PSQC No. 1
c.
Philippine Audit Practice Statements
d.
PSA 220
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The correct answer is: The firm’s decision

Question 2
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An engagement quality control review is required to be performed

a.
At engagement complexion after the report is issued
b.
For all types of audits, regardless of the subject matter of the engagement
c.
For all audits of financial statements of listed entities
d.
Immediately after the re-assessment of control risk
Feedback
The correct answer is: For all audits of financial statements of listed entities

Question 3
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Actions and messages that encourage a culture of quality are communicated
through

a.
Training seminars, meeting, formal or informal dialogue, mission statement
b.
Partners and staff appraisal procedures
c.
Newsletters and briefing memoranda, internal documentation and training
mate-rials
d.
All of these
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The correct answer is: All of these

Question 4
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A firm has obtained information that would have caused it to decline an en-
gagement had the information been available earlier. Actions available to the
auditor include the following, EXCEPT

a.
Withdraw from the engagement
b.
Reporting the information and its implications to the person(s) who appointed
the CPA
c.
Withdraw from both the engagement and the clients relationship
d.
Continue the engagement, since the Code of Ethics requires started
engagements to be finished regardless to subsequent developments and
information
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The correct answer is: Continue the engagement, since the Code of Ethics
requires started engagements to be finished regardless to subsequent
developments and information

Question 5
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The partner or other person in the firm who is responsible for the engage-
ment and its performance, and for the report that is issued on behalf of the
firm, and who, where required, has the appropriate authority from the
professional, legal or regulatory body

a.
Engagement partner
b.
Engagement quality control reviewer
c.
Suitably qualified external person
d.
Personnel
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The correct answer is: Engagement partner

Question 6
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The policies and procedures adopted by a firm designed to proved it with
reasonable as-surance regarding compliance with professional standards and
regulatory and legal require-ments, and appropriateness of reports issued by
the firm

a.
Code of Ethics
b.
Quality Controls
c.
Monitoring
d.
Internal controls
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The correct answer is: Quality Controls

Question 7
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Compared to larger firms, smaller firms may use

a.
More formal methods in documenting the system of quality controls
b.
Electronic databases to document the system of quality controls
c.
More elaborate means of documenting the system of quality controls
d.
More informal methods in documenting the system of quality controls
Feedback
The correct answer is: More informal methods in documenting the system of
quality controls

Question 8
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Controls that the firm may design and implement to maintain the confidenti-
ality, safe custody, integrity, accessibility and retrievability of engagement
documentation include the following except

a.
Procedures for restricting access to, and enabling proper distribution and
confi-dential storage of, hardcopy engagement documentation
b.
Appropriate back-up routines for electronic engagement documentation
(always done at the end of the engagement)
c.
The use of a password among engagement team members to restrict access to
electronic engagement documentation to authorized users
d.
Procedures for properly distributing engagement documentation to the team
members at the start of engagement, processing it during engagement, and
col-lating it at the end of engagement
Feedback
The correct answer is: Procedures for properly distributing engagement
documentation to the team members at the start of engagement, processing it
during engagement, and col-lating it at the end of engagement

Question 9
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The following statements pertain to quality control reviewers. Which state-
ment is correct?

a.
All are correct.
b.
External persons may not be contracted as engagement quality control
reviewers
c.
None of the above.
d.
The engagement partner may consult the engagement quality control
reviewer during the engagement
e.
Where the nature and extent of the consultations become significant, care is
taken by both the engagement team and the reviewer to maintain the
reviewer’s integrity
Feedback
The correct answer is: The engagement partner may consult the engagement
quality control reviewer during the engagement

Question 10
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The familiarity threat maybe created by using the same senior personnel on
an assurance engagement over a long period of time and the safeguards that
might be ap-propriate to address such a threat. Accordingly, safeguards may
include

a.
Both a and b
b.
Neither a nor b
c.
Rotation of senior personnel
d.
Engagement quality control review
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The correct answer is: Rotation of senior personnel

Question 11
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An individual outside the firm with the capabilities and competence to act as
an engagement partner, for example of a partner of another firm, or an
employee (with ap-propriate experience) of either a professional accountancy
body whose members may per-form audits and reviews of historical financial
information, or other assurance or related services engagements, or of an
organization that provides relevant quality control services

a.
Engagement partner
b.
Suitably qualified external person
c.
Engagement quality control reviewer
d.
Partner
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The correct answer is: Suitably qualified external person

Question 12
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Ethical requirements to which the engagement team and engagement quality
control reviewer are subject, which ordinarily comprise Parts A and B of the
Code of Ethics, together with national requirements that are more restrictive

a.
Pre- conditions to an audit
b.
Client screening criteria
c.
Relevant ethical requirements
d.
Fundamental principles
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The correct answer is: Relevant ethical requirements

Question 13
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Personnel issues that must be addressed by the system of quality control in-
clude the following, EXCEPT

a.
Recruitment and performance evaluation
b.
Capabilities and competence
c.
Career development and promotion
d.
Compensation and estimation of personnel needs
e.
All of the answers
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The correct answer is: All of the answers

Question 14
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The following are the fundamental principles of professional ethics, EXCEPT

a.
Integrity
b.
Professional competence and due care
c.
Objectivity
d.
Independence
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The correct answer is: Independence

Question 15
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Smaller firms, in particular, may

a.
Be exempted for the first three years of its operation from employing
methods of evaluating the performance of their personnel
b.
Employ more formal methods of evaluating the performance of their
personnel
c.
Be exempted under PSQC1 from employing methods of evaluating the
perfor-mance of their personnel
d.
Employ less formal methods of evaluating the performance of their personnel
Feedback
The correct answer is: Employ less formal methods of evaluating the
performance of their personnel

Question 1
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Responsibility for the monitoring process is entrusted to

a.
Managers
b.
Audit associates
c.
Senior associates
d.
Partners
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The correct answer is: Partners

Question 2
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The firm should obtain written confirmation of compliance with its policies
and procedures on independence from all firm personnel required to be
independent by the Code of Ethics

a.
Quarterly
b.
Monthly
c.
Every 3 years
d.
Annually
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The correct answer is: Annually

Question 3
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A process comprising an ongoing consideration and evaluation of the firm’s
system of quality control, including a periodic inspection of a selection of
completed en-gagements, designed to enable the firm to obtain reasonable
assurance that its system of quality control is operating effectively

a.
Monitoring
b.
Quality review
c.
Engagement quality control review
d.
Inspection
Feedback
The correct answer is: Monitoring

Question 4
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By obtaining confirmation and taking appropriate action on information indi-
cating noncompliance, the firm demonstrates the importance that it attaches
to independ-ence and makes the issue current for, and visible to, its
personnel. Written confirmation

a.
May be in paper form or electronic form
b.
Is not required since oral confirmation will suffice per PSQC1
c.
May be in electronic format only
d.
May be in paper format only
Feedback
The correct answer is: May be in paper form or electronic form

Question 5
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Regarding the assignment of engagement teams, which of the following
statements is INCORRECT?

a.
The firm should assign responsibility for each engagement to the senior
manager
b.
The firm should also assign appropriate staff with the necessary capabilities,
competence and time to perform engagements in accordance with
professional standards and regulatory and legal requirements, and to enable
the firm or en-gagement partners to issue reports that are appropriate in the
circumstances
c.
The identity and role of the engagement partner should be communicated to
key members of client management and those charged with governance
d.
Policies and procedures include systems to monitor the workload and
availability of engagement partners so as enable these individuals to have a
sufficient time to adequately discharge their responsibilities
Feedback
The correct answer is: The firm should assign responsibility for each
engagement to the senior manager

Question 6
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Regarding identified threats to independence, appropriate action by the firm
and the relevant engagement partner includes the following, EXCEPT

a.
Application of safeguards to eliminate threats to independence
b.
Expression of a qualified or adverse opinion on the subject matter under audit
c.
Withdrawal from the engagement
d.
Application to safeguards to reduce threats to independence to an acceptable
level
Feedback
The correct answer is: Expression of a qualified or adverse opinion on the
subject matter under audit

Question 7
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Which of the following methods are least likely to develop capabilities and
competence?

a.
Continuing professional development including training
b.
Professional education
c.
Self-study modules on professional accounting and auditing literature
d.
Work experience and coaching by less experienced staff
Feedback
The correct answer is: Work experience and coaching by less experienced
staff

Question 8
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The normal retention period for audit engagement documentation is no
shorter than __ from the date of the audit report

a.
Five years
b.
Six years
c.
Four years
d.
Two years
Feedback
The correct answer is: Five years

Question 9
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The firm should establish policies and procedures designed to provide it with
reasonable assurance those individuals and firms maintain independence
(where required by the Code of Ethics). Such policies and procedures should
enable the firm to (select the exception):

a.
Communicate independence requirements
b.
Identify and evaluate circumstances and relationships that create threats to in-
dependence
c.
Override independence requirements of PSQC1
d.
Take appropriate action to eliminate or reduce threats
Feedback
The correct answer is: Override independence requirements of PSQC1

Question 10
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Quality control policies and procedures are designed to promote an internal
culture recognizing that

a.
The promotion of a quality-oriented internal culture depends on clear,
consistent and frequent actions and messages from all levels of the firm’s
management
b.
The firm should always move towards the elimination of audit risk
c.
Quality is essential in performing engagements
d.
Reasonable, and not absolute, assurance can be provided by all CPA
engagements
Feedback
The correct answer is: Quality is essential in performing engagements

Question 11
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The firm should communicate the results of the monitoring of its quality con-
trol system to engagement partners and other appropriate individuals within
the firm at least every

a.
Two years
b.
Three years
c.
Six months
d.
Twelve months
Feedback
The correct answer is: Twelve months

Question 12
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Which of the following best describes the word “personnel” in the context of
PSQC No.1?

a.
This refers to any individual with authority to bind the firm with respect to
the performance of a professional services engagement
b.
All of these statements describe “personnel”
c.
This refers to professionals, other than partners, including any experts the
firm employs
d.
This refers to partners and staff
Feedback
The correct answer is: This refers to partners and staff

Question 13
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The firm’s business strategy is subject to the overriding requirement for the
firm to achieve quality in all the engagements that the firm performs.
Accordingly, the firm

a.
All of the answers
b.
Assigns its management responsibilities so that commercial considerations
may override the quality of work performed
c.
Devotes sufficient resources for the development, documentation and support
of its quality control policies and procedures
 d.
Designs policies and procedures addressing performance evaluation,
compensa-tion, and promotion to demonstrate the firm’s overriding
commitment to quality
Feedback
The correct answer is: Assigns its management responsibilities so that
commercial considerations may override the quality of work performed

Question 14
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Information on matters regarding integrity of the client may come from

a.
All of these
b.
Background searchers of relevant databases
c.
Inquiry of other firm personnel or third parties such as (bankers, legal counsel
and industry peers)
d.
Communication with existing or previous providers of CPA services to the
client
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The correct answer is: All of these

Question 15
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Supervision includes

a.
Tracking the progress of the engagement
b.
Considering the capabilities and competence of individual members of client
personnel
c.
Identifying matters for consultation or consideration by less experienced en-
gagement team members during the engagement
d.
Addressing all issues arising during the engagement and modifying the
planned approach appropriately
Feedback
The correct answer is: Tracking the progress of the engagement

Question 1
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Where the engagement quality control reviewer makes recommendations that
the engagement partner does not accept and the matter is not resolved to the
review-er’s satisfaction, the report
 a.
Is issued with an emphasis of a matter paragraph highlighting the difference
in opinion

b.
Is not issued until the matter is resolved by following the firm’s procedures
for dealing with differences of opinion

c.
Is not issued until the matter is resolved by client management

d.
Will not be issued
Feedback
The correct answer is: Is not issued until the matter is resolved by following
the firm’s procedures for dealing with differences of opinion

Question 2
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The firms policies and procedures emphasize the fundamental principles,
which are reinforced in particular by

a.
All of these
 b.
Monitoring and process for dealing with non-compliance

c.
Education and training

d.
Leadership of the firm
Feedback
The correct answer is: All of these

Question 3
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With regard to the integrity of a client, matters that the firm considers include
the following

a.
The identity and business reputation of the client’s principal owners, key
man-agement, related parties and those charged with its governance

b.
The nature of the client’s operations, including its business practices

c.
Information concerning the attitude of the client’s principal owners, key man-
agement and those charged with its governance towards such matters as
aggres-sive interpretation of accounting standards and the internal control
environment

d.
All of the answers
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The correct answer is: All of the answers

Question 4
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All personnel performing an engagement, excluding experts contracted by the
firm in connection with that engagement

a.
Engagement team

b.
Staff

c.
Personnel

d.
Professionals
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The correct answer is: Engagement team

Question 5
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Consultation may be obtained in the form of advisory services provided by

a.
Professional and regulatory bodies

b.
Other firms

c.
Commercial organizations that provide relevant quality control services

d.
Any of these
Feedback
The correct answer is: Any of these

Question 6
Correct

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In the case of an audit, final engagement files should be completely assem-
bled not more than ___ days after the date of the audit report

a.
10

b.
60

c.
30

d.
5
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The correct answer is: 60

Question 7
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Original paper documentation may be scanned and stored electronically for
practical reasons. After scanning, the original paper document

a.
None of these

b.
Shall be considered for retention or disposal depending on legal or regulatory
re-quirements and other factors

c.
Shall be discarded following established principles on waste disposal

d.
Shall be kept on file for future reference
Feedback
The correct answer is: Shall be considered for retention or disposal depending
on legal or regulatory re-quirements and other factors

Question 8
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In a certain audit engagement, several key members of the engagement team
had differences of opinion regarding a certain matter. In this case

a.
The report shall not be issued until the matter is resolved

b.
Documentation will be made regarding the unsolved matter, and the auditor
will withdraw from the engagement altogether

c.
The engagement partner shall issue a disclaimer of opinion due to a scope
limita-tion

d.
An increase in the audit fee will be requested due to the extension of the time
required to complete the engagements
Feedback
The correct answer is: The report shall not be issued until the matter is
resolved

Question 9
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AASC Engagement Standards as defined in the “Preface to the Philippines
Standards on Quality Control, Auditing Assurance and Related Services,”
and relevant ethical requirements, which ordinarily comprise Parts A and B
of the IFAC Code and relevant national requirements

a.
Philippine Standards on Auditing

b.
Philippine Standards on Assurance

c.
Standards of Quality Control

d.
Professional Standards
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The correct answer is: Professional Standards

Question 10
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Where internal technical and training resources are unavailable, the firm

a.
Cannot adequately provide for the professional development needs of its
mem-bers

b.
Must obtain, within two years, the necessary internal technical and training
re-sources
 c.
May use a suitably qualified external person for that purpose

d.
Violates a basic tenet of quality control regarding capabilities and
competence
Feedback
The correct answer is: May use a suitably qualified external person for that
purpose

Question 11
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An engagement quality control review for audits of financial statements of
listed entities includes considering the following, except

a.
Judgments made, particularly with respect to materiality and significant risks

b.
Whether working papers selected for review reflect the work performed in
rela-tion to the significant judgments and support significant management
assertions

c.
The engagement team’s evaluation of the firm’s independence in relation to
the specific engagement

d.
Significant risks identified during the engagement and the responses to those
risks
Feedback
The correct answer is: Whether working papers selected for review reflect the
work performed in rela-tion to the significant judgments and support
significant management assertions

Question 12
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A partner, other person in the firm, suitably qualified external person, or a
team made up of such individuals, with sufficient and appropriate experience
and authority to objectively evaluate, before the report issued, the significant
judgments the engagement team made and the conclusions they reached in
formulating the report

a.
Engagement quality control reviewer

b.
Personnel

c.
Engagement partner

d.
Suitably qualified external person
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The correct answer is: Engagement quality control reviewer

Question 13
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PSQC No. 1 applies to _____________, while PSA 220 applies to
____________.

a.
Assurance engagements, audits

b.
Audit, reviews

c.
Assurance engagements, related services

d.
Audits, assurance engagements
Feedback
The correct answer is: Assurance engagements, audits
Question 14
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Deficiencies notes as result of the monitoring process may indicate

a.
Neither a nor b

b.
Instances that so not necessarily indicate an insufficiency in the quality
control system

c.
Both a and b

d.
Systematic, repetitive or other significant deficiencies that require prompt
corrective action
Feedback
The correct answer is: Both a and b

Question 15
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Criteria for determining whether an engagement quality control review
should be performed include the following

a.
The nature of the engagement, including extent of involvement of the public
in-terest

b.
Unusual circumstances or risks in an engagement or class of engagements

c.
Laws and regulations that may require an engagement quality control review

d.
All of these
Feedback
The correct answer is: All of these

Question 1
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An entity under common control, ownership or management with the firm or
any entity that a reasonable and informed third party having knowledge of all
relevant in-formation would reasonably conclude as being part of the firm
nationally or internationally

a.
Firm
b.
Network firm
c.
Listed entity
d.
Engagement team
Feedback
The correct answer is: Network firm

Question 2
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The capabilities and competence considered when assigning engagement
teams, and in determining the level of supervision required, include the
following

a.
An understanding of the firm’s quality control policies and procedures
b.
An understanding of professional and standards and regulatory and legal re-
quirements
c.
An understanding of, and practical experience with engagements of a similar
na-ture and complexity through appropriate training and participation
d.
Ability to apply professional skepticism
Feedback
The correct answer is: Ability to apply professional skepticism

Question 3
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The inspection of a selection of completed engagements is ordinarily per-
formed on a cyclical basis. Engagements selected for inspection include at
least

a.
Two engagements for each firm over an inspection cycle
b.
One engagement for each firm over an inspection cycle
c.
One engagement for each engagement partner over an inspection cycle of 3
years
d.
Two engagements for each engagement partner over an inspection cycle
Feedback
The correct answer is: One engagement for each engagement partner over an
inspection cycle of 3 years

Question 4
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Reviewers consider

a.
Whether the system of quality control is operating effectively and adequately
b.
The work performed supports the conclusions reached and is appropriately
doc-umented
c.
The work has been performed in accordance with GAAP
d.
Consultation with experts has been made for all phases of the engagement
Feedback
The correct answer is: The work performed supports the conclusions reached
and is appropriately doc-umented

Question 5
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The firm should obtain such acceptance and continuance information as it
considers necessary in the circumstances such as when

a.
All of the answers
b.
Accepting an engagement with a new client
c.
Deciding whether to continue an existing engagement
d.
Accepting a new engagement with an existing client
Feedback
The correct answer is: All of the answers

Question 6
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In considering whether the firm has the capabilities, competence, time and
resources to undertake a new engagement from a new or an existing client,
the firm reviews the specific requirements of the engagement and existing
partner and staff profiles at all relevant levels. Matters the firm considers
include the following, EXCEPT

a.
Whether the firm is able to complete the engagement within the reporting
dead-line
b.
Whether the client is aggressively concerned with maintaining the firms fees
as low as possible
c.
Whether firm personnel have knowledge of relevant industries or subject
matters
d.
Whether firm personnel have experience with relevant regulatory or reporting
requirements, or the ability to gain the necessary skills and knowledge
effectively
Feedback
The correct answer is: Whether the client is aggressively concerned with
maintaining the firms fees as low as possible

Question 7
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The engagement quality control reviewer (choose he INCORRECT one)

a.
Does not otherwise participate in the engagement during the period of review
b.
Is not subject to other considerations that would threaten the reviewer’s
objec-tivity
c.
Does not make decisions for the engagement team
d.
May be selected by the engagement partner
Feedback
The correct answer is: May be selected by the engagement partner

Question 8
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This is a review that provides an objective evaluation of the significant judg-
ments made by the engagement team and the conclusions reached in
formulating by the report
 a.
System of quality control
b.
Peer review
c.
Engagement quality control review
d.
Engagement judgment review procedures
Feedback
The correct answer is: Engagement quality control review

Question 9
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Consultation usually undertaken for

a.
Matters for which the judgment of the engagement leader is deemed
sufficient
b.
Straightforward matters involving accounting and auditing
c.
Matters for which there is readily available support
d.
Difficult or contentious matters
Feedback
The correct answer is: Difficult or contentious matters

Question 10
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An entity whose shares, stock or debt are quoted or listed on a recognized
stock exchange, or are marketed under the regulations of a recognized stock
exchange or other equivalent body

a.
Public sector entity
b.
Recognized entity
c.
Quoted entity
d.
Listed entity
Feedback
The correct answer is: Listed entity

Question 11
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What aspects are most important in determining the eligibility of engagement
quality control reviewer?

a.
Competence and independence
b.
Technical qualifications and objectivity
 c.
Integrity and objectivity
d.
All of these
Feedback
The correct answer is: Technical qualifications and objectivity

Question 12
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Which of the following statements in incorrect?

a.
The extent of the review depends on the complexity of the engagement and
the risk that the report might not be appropriate in the circumstances
b.
An engagement quality control review is always conducted at the end of the
en-gagement
c.
An engagement quality control review ordinarily involves discussion with the
en-gagement partner, a review of the financial statements or other subject
matter information and the report, and, in particular, consideration of whether
the report is appropriate
d.
The review does not reduce the responsibilities of the engagement partner
Feedback
The correct answer is: An engagement quality control review is always
conducted at the end of the en-gagement

Question 13
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Unless otherwise specified by law, engagement documentation is owned by

a.
The client
b.
The firm
c.
The Board of Accountancy
d.
The client and the firm
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The correct answer is: The firm

Question 14
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An inspection cycle ordinarily spans no more than

a.
One Year
b.
Two Years
c.
Four Years
d.
Three Years
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The correct answer is: Three Years

Question 15
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In relation to completed engagements, these are procedures designed to pro-
vide evidence of compliance by engagement teams with the firm’s quality
control policies and procedures

a.
Quality Control
b.
Monitoring
c.
Engagement quality control review
d.
Inspection
The correct answer is: Inspection

Question 1
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Monitoring of the firm’s system of quality control is performed by competent
individuals and cover (i)appropriateness of the design of quality controls; and
(2)Effectiveness of the operation of quality controls.

a.
No, no
b.
Yes, no
c.
Yes, yes
d.
No, yes
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The correct answer is: Yes, yes

Question 2
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Review responsibilities are determined on the basis that _____ experienced
team members review the work of _______ experienced team members

a.
More, less
b.
Less, more
c.
More, more
d.
Less, less
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The correct answer is: More, less
Question 3
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Through its policies and procedures, the firm seeks to establish consistency in
the quality of engagement performance. This is often accomplished through
(select the INCORRECT ITEM)

a.
Industry or subject-matter-specific guidance materials
b.
Written confirmation of compliance with independence requirements
c.
Software tools or other forms of standardized documentation
d.
Written or electronic manuals
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The correct answer is: Written confirmation of compliance with
independence requirements

Question 4
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An engagement quality control review for audits of financial statements of
listed entities includes considering the following, except

a.
Significant risks identified during the engagement and the responses to those
risks
b.
The engagement team’s evaluation of the firm’s independence in relation to
the specific engagement
c.
Whether working papers selected for review reflect the work performed in
rela-tion to the significant judgments and support significant management
assertions
d.
Judgments made, particularly with respect to materiality and significant risks
Feedback
The correct answer is: Whether working papers selected for review reflect the
work performed in rela-tion to the significant judgments and support
significant management assertions

Question 5
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Responsibility for the monitoring process is entrusted to

a.
Partners
b.
Managers
c.
Audit associates
d.
Senior associates
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The correct answer is: Partners
Question 6
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Personnel issues that must be addressed by the system of quality control in-
clude the following, EXCEPT

a.
Recruitment and performance evaluation
b.
Capabilities and competence
c.
All of the answers
d.
Career development and promotion
e.
Compensation and estimation of personnel needs
Feedback
The correct answer is: All of the answers

Question 7
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An entity under common control, ownership or management with the firm or
any entity that a reasonable and informed third party having knowledge of all
relevant in-formation would reasonably conclude as being part of the firm
nationally or internationally
 a.
Engagement team
b.
Firm
c.
Listed entity
d.
Network firm
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The correct answer is: Network firm

Question 8
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Controls that the firm may design and implement to maintain the confidenti-
ality, safe custody, integrity, accessibility and retrievability of engagement
documentation include the following except

a.
Procedures for restricting access to, and enabling proper distribution and
confi-dential storage of, hardcopy engagement documentation
b.
The use of a password among engagement team members to restrict access to
electronic engagement documentation to authorized users
c.
Procedures for properly distributing engagement documentation to the team
members at the start of engagement, processing it during engagement, and
col-lating it at the end of engagement
d.
Appropriate back-up routines for electronic engagement documentation
(always done at the end of the engagement)
 Feedback
The correct answer is: Appropriate back-up routines for electronic
engagement documentation (always done at the end of the engagement)

Question 9
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The following are the fundamental principles of professional ethics, EXCEPT

a.
Integrity
b.
Independence
c.
Objectivity
d.
Professional competence and due care
Feedback
The correct answer is: Independence

Question 10
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A firm has obtained information that would have caused it to decline an en-
gagement had the information been available earlier. Actions available to the
auditor include the following, EXCEPT
 a.
Continue the engagement, since the Code of Ethics requires started
engagements to be finished regardless to subsequent developments and
information
b.
Reporting the information and its implications to the person(s) who appointed
the CPA
c.
Withdraw from both the engagement and the clients relationship
d.
Withdraw from the engagement
Feedback
The correct answer is: Continue the engagement, since the Code of Ethics
requires started engagements to be finished regardless to subsequent
developments and information

Question 11
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In the case of an audit, final engagement files should be completely assem-
bled not more than ___ days after the date of the audit report

a.
30
b.
60
c.
5
d.
10
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The correct answer is: 60

Question 12
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Ethical requirements to which the engagement team and engagement quality
control reviewer are subject, which ordinarily comprise Parts A and B of the
Code of Ethics, together with national requirements that are more restrictive

a.
Relevant ethical requirements
b.
Client screening criteria
c.
Pre- conditions to an audit
d.
Fundamental principles
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The correct answer is: Relevant ethical requirements

Question 13
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The policies and procedures adopted by a firm designed to proved it with
reasonable as-surance regarding compliance with professional standards and
regulatory and legal require-ments, and appropriateness of reports issued by
the firm

a.
Monitoring
b.
Quality Controls
c.
Code of Ethics
d.
Internal controls
Feedback
The correct answer is: Quality Controls

Question 14
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Unless otherwise specified by law, engagement documentation is owned by

a.
The client
b.
The firm
c.
The client and the firm
d.
The Board of Accountancy
Feedback
The correct answer is: The firm

Question 15
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Where the engagement quality control reviewer makes recommendations that
the engagement partner does not accept and the matter is not resolved to the
review-er’s satisfaction, the report

a.
Is not issued until the matter is resolved by client management
b.
Is not issued until the matter is resolved by following the firm’s procedures
for dealing with differences of opinion
c.
Is issued with an emphasis of a matter paragraph highlighting the difference
in opinion
d.
Will not be issued
Feedback
The correct answer is: Is not issued until the matter is resolved by following
the firm’s procedures for dealing with differences of opinion