Professional Documents
Culture Documents
Auditing
Tutorial 1
Discuss the differences and similarities between the roles of accountants and
auditors. What additional expertise must an auditor possess beyond that of an
accountant?
Answer:
The role of accountants is to record, classify, and summarize economic events in
a logical manner for the purpose of providing financial information for
decision-making. To do this, accountants must have a sound understanding of
the principles and rules that provide the basis for preparing the financial
information. In addition, accountants are responsible for developing systems
to ensure that the entitys economic events are properly recorded on a timely
basis and at a reasonable cost.
The role of auditors is to determine whether the financial information prepared by
accountants properly reflects the economic events that occurred. To do this, the
auditor must not only understand the principles and rules that provide the basis for
preparing financial information, but must also possess expertise in the accumulation
and evaluation of audit evidence. It is this latter expertise that distinguishes auditors
from accountants.
Choose:
1- The process of recording, classifying, and summarizing economic events in a logical
manner for the purpose of providing financial information for decision-making is
a. finance.
b. auditing.
c. accounting.
d. economics.
Ans. C
Ans. D
4- The criteria by which an auditor evaluates the information under audit may not
vary regardless of the information being audited.
a. True
b. False
Ans. B
6- The financial statements most commonly audited by external auditors are the
balance sheet, the income statement, and the statement of cash flows.
a. True
b. False
Ans. A
7-The statements most commonly included in an audit of financial statements are the
a. statement of financial position, the income statement, and the statement of changes
in financial position.
b. income statement, the statement of changes in financial position, and the statement
of net working capital.
c. statement of changes in financial position, the statement of cash flows, and the
retained earnings statement.
d. statement of financial position, the income statement, and the statement of cash
flows.
Ans. D
a. True
b. False
Ans. A