MCQs are one of the best ways to test a student’s comprehension of a concept. Academic Task subject experts have prepared these Auditing MCQs based on current trends and practices. Furthermore, the questions present in the auditing MCQs section will be beneficial for competitive examinations and tests (PPSC Test, FPSC Test, SPSC Test, KPPSC Test, BPSC Test, Etea Test) as well.  Auditing MCQs are also helpful for various posts like  Senior Auditor, Junior Auditor, Accountant, Internal Auditors, External Auditors. MCQs of auditing covers the topic like Basic Auditing MCQs, Financial Audit, Income Tax Audit, Internal Audit Operational Auditing – and much more.  Also, check Cost Accounting MCQs with answers here.

21. Which of the following describes sampling risk?

A. The risk of the auditor carrying out a test the wrong way round
B. The risk of reliance on unsuitable audit evidence
C. The risk that the sample does not reflect the population
D. The risk of the auditor reaching the wrong conclusions from testing

22. Which of the following is NOT an accepted method of selection in sampling?

A. Systematic selection
B. Pervasive selection
C. Random selection
D. Haphazard selection

23. Which of the following are you unlikely to see in the current file of auditors’ working papers?

A. Memorandum & articles of association
B. Audit planning memorandum
C. Summary of unadjusted errors
D. Details of the work done on the inventory count

24. According to ISA 500, the strength of audit evidence is determined by which two qualities?

A. Appropriateness & competence
B. Sufficiency & appropriateness
C. Reliability & extensiveness
D. Objectivity & independence

25. Which of the following is normally the most reliable source of audit evidence?

A. Internal audit
B. Suppliers’ statements
C. Board minutes
D. Analytical review

26. The degree of effectiveness of an internal control system depends on:

A. The design of the internal control system and the implementation of the controls
B. The design of the internal controls and the implementation of the control system
C. The implementation of the controls and the correctness of the accounting records
D. The design of the internal control system and the correctness of the accounting records

27. Which one of the following is NOT considered to be part of planning?

A. Background i.e. industry
B. Previous year’s audit i.e. any qualifications in the report
C. Considering the work to be done by the client staff e.g. internal audit
D. Considering whether the financial statements show a true and fair view

28. Audit risk is composed of 3 factors. Which of the following is NOT one of those factors?

A. Compliance risk
B. Detection risk
C. Control risk
D. Inherent risk

29. Which of the following should NOT be considered at the planning stage?

A. The timing of the audit
B. Analytical review
C. Last year’s written representation letter
D. Obtaining written representations

30. At the planning stage you would NOT consider____________?

A. the timing of the audit
B. whether corrections from the inventory count have been implemented
C. last year’s audit
D. the potential use of internal audit