Breaking News

Wednesday, October 28, 2020

Introduction to Auditing MCQs | Auditing MCQs | Auditing Multiple Choice Questions and Answers

 Introduction to Auditing MCQs

Auditing MCQs

1. The word auditing is derived from the latin word:

a)       Autire

b)       Audire

c)        Aukire

d)       Aufire

Hint: Audire means to “hear.”

2. Double entry system was introduced in the year:

a)      1493

b)      1494

c)       1495

d)      1496

3. Who is called father of modern accountancy who also described the duties and responsibilities of auditor?

a)      FW taylor

b)      Spicer and Pegler

c)       Luca Paciolo

d)      Batliboi

4. Which Act prescribed the qualification for an auditor for the first time?

a)      Companies Act, 2013

b)      Companies Act, 1956

c)       Companies Act, 1947

d)      Companies Act, 1913

5. The Chartered Accountants Act was passed in the year:

a)      1947

b)      1948

c)       1949

d)      1950

6. Auditing refers to           

a)      Preparation and checking of account

b)      Examination of accounts of business units only

c)       Examination of accounts of professional accountants

d)      Checking of vouchers

7. Auditing is compulsory for            

a)      Small scale business enterprises

b)      All partnership firms

e)      All joint stock companies

c)       All proprietary concerns

8. Auditing is luxury for a                 

a)      Joint stock company

b)      Partnership firm

c)       Small shop-keeper

d)      Government company

9. Main object of auditing is                 

a)      Detection of errors

b)      To find out whether P&L a/c & B/S show true and fair state affairs

c)       Detection of frauds

d)      Detection and prevention of frauds and errors.

10. Which one the following statement is true?

a)      Audit is a systematic and Independent examination of books of accounts.

b)      The audit should be conducted in unbiased manner.

c)       Audit report is the final product of the whole audit work.

d)      All of the above

11. Auditing begins, where accountancy ends.

12. Auditor is mainly concerned with:

a)      Critical examination of books of accounts.

b)      Verification of accounts prepared by others.

c)       Preparation of audit report.

d)      All of the above.

ALSO READ: AUDITING 200 MULTIPLE CHOICE QUESTIONS AND ANSWER (MCQS)

13. Accounting is necessity where as auditing is a luxury but for whom?

a)      Joint stock company

b)      Partnership firm

c)       Small shop-keeper

d)      Government company

14. An auditor is an employee of the company.                  False, The auditor is an independent outsider appointed on contractual basis.

15. The main purpose of audit is to see whether:

a)      The balance sheet shows true and fair view of statement of affairs of the business.

b)      The profit and loss accounts show true and fair operating results.

c)       All of the above

d)      None of the above

16. Which one of the following are not the secondary objects of an audit?                 

a)      Detection of errors

b)      To find out whether P&L a/c & B/S show true and fair state affairs

c)       Detection of frauds

d)      Detection and prevention of frauds and errors.

17. An auditor is a watch dog, not a blood hound.

18. Which one of the following statement is true?

a)      Audit of sole proprietorship is voluntary.

b)      Audit of partnership firm is mandatory if turnover exceed Rs.1 Crore (business) or Rs. 50 lakhs (profession).

c)       Audit of companies is compulsory.

d)      All of the above.

19.  A sole trader goes for audit to know that his business is conducted efficiently.

20. Partners go for audit to know that their partnership is conducted efficiently.

21. Auditing is a post-mortem examination of books of accounts.              True

22. An in depth examination to detect a suspected fraud is termed as:

a)      Auditing

b)      Investigation

c)       Internal Check

d)      In depth analysis

23. Audit conducted between two annual audits is knows as:

a)      Efficiency audit

b)      Internal Audit

c)       Interim audit

d)      Special Audit

24. Which audit is conducted every month on a progressive manner?

a)      Efficiency audit

b)      Internal Audit

c)       Interim audit

d)      Continuous audit

25. When the auditor is an employee of the organization being audited (auditee), the audit is classified as a__ Quality audit.

a)      Internal

b)      External

c)       C.Compliance

d)      D.Both A & B

26. The_____ is also expected to provide the resources needed and select staff members to accompany the auditors.

a)      Auditor

b)      Client

c)       Internal auditor

d)      Auditee

27. Each of the three parties involved in an audit______ plays a role that contributes to its success.

a)      The client, the auditor, and the auditeer

b)      The client, the auditor, and the audite

c)       The client, the moderator, and the auditee

d)      The client, the auditor, and the auditee

28. Power of audit of government audit lies with comptroller and auditor general of India (CAG).                              True

29. SA 200 – Basic principles governing at audit.

30. Auditor has right to disclose the client information to a third party.                    False

ALSO READ: AUDITING 200 MULTIPLE CHOICE QUESTIONS AND ANSWER (MCQS)

Popular Posts for the Day