1271. Before the commencement of his audit work letter sent by the auditor is known as :

A. Management letter
B. Representation letter
C. Engagement letter *
D. None of the above

1272. Which of the following statements describes most accurately the principal purpose of the engagement letter in respect of a limited company audit assignment ?

A. To establish the scope of the auditor’s duties *
B. Course of action with respect to the making arrangements for a review
C. To determine the current year’s audit fee
D. To draw the consideration of the chiefs to the scope of administrations that the firm can offer

1273. Auditor sends engagement letter:

A. Before commencement of audit *
B. During the course of the audit
C. At the end of the audit
D. All of the above

1274. Working papers are property of :

A. Client
B. Registrar
C. Auditor *
D. Corporate law authority

1275. Which one of the following working papers would normally be retained on the permanent file maintained for a limited company audit client ?

A. Extracts of shareholders and management meetings
B. Entity policy regarding provident fund
C. Engagement letter
D. A copy of the Memorandum and the Association’s Bylaws *

1276. Which one of the following working papers would normally be retained on the current file maintained for a limited company audit client ?

A. An organization chart summarising management functions and the division of responsibilities within the company
B. A copy of the bank’s response to the standard audit request letter *
C. Analysis of transaction and balances
D. A description of the business and its operations

1277. Misappropriation of goods may be checked by :

A. Proper supervision over stock *
B. Checking of employees
C. Punishment of employees
D. None of the above

1278. Window dressing implies

A. Curtailment of expenses
B. Checking wastages
C. Under-valuation of assets
D. Over-valuation of assets *

1279. Falsification of accounts is undertaken by :

A. Auditors
B. Clerks
C. Accountants
D. Responsible officials *

1280. Errors of omission are :

A. Technical errors
B. Errors of principle
C. Compensating errors
D. None of the above