CA Intermediate Paper 5

Audit Report MCQ

Chapter 8 • 12 Questions from ICAI Study Material

Questions

12

Est. Time

18 min

Source

ICAI Book

Sample Questions: Audit Report

Preview 4 of 12 questions from Chapter 8

1. While expressing an unmodified opinion on financial statements, the auditor shall not use which of the following phrases?

A) present fairly in all material respects
B) give a true and fair view
C) with the foregoing explanation ✓
D) All of the above 2. …………………… is a paragraph included in the auditor’s report that refers to a matter appropriately presented or disclosed in the financial statements that, in the auditor’s judgement, is of such importance that it is fundamental to the user’s understanding of the financial statements. (a) Emphasis of Matter Paragraph (b) Other Matter Paragraph (c) Key Audit Matter (d) Management Responsibility Paragraph.

2. Statement 1: Communicating key audit matter in the auditor’s report constitutes a substitute for disclosure in the financial statements. Statement 2: Instead of modifying an opinion in accordance with SA 705, the statutory auditor can use Key Audit Matter paragraph in the audit report with an unmodified opinion.

A) Only Statement 1 is correct
B) Only Statement 2 is correct
C) Both the statements are correct
D) None of the statement is correct ✓

3. Which of the following is not correct?

A) SA 700 - Forming an Opinion and Reporting on the Financial Statements
B) SA 701- Key Audit Matters in the Independent Auditor’s Report
C) SA 705- Comparative Information- Corresponding figures and Comparative Financial Statements ✓
D) SA 706- Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor’s Report
Correct/Incorrect

4. The auditor shall express a qualified opinion when the auditor concludes that the financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework.

Correct
Incorrect ✓

Explanation: The auditor shall express an unmodified opinion when the auditor concludes that the financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework.