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Wednesday, October 28, 2020

MCQs on Audit Report | Auditing MCQs | Auditing | Multiple Choice Questions and Answers (MCQs)

 MCQ on Audit Report

1. Audit committee is mandatory for:

a) All listed public companies

b) For unlisted companies having paid up of Rs. 10 crores or more.

c) For unlisted companies having turnover or Rs. 100 crores or more or having outstanding long term payments exceeding Rs. 50 crores or more.

d) All of the above

2. Audit committee shall constitute minimum __________ 3 directors where independent directors forming majority.

a)      Three

b)      Four

c)       Five

d)      Six

3. The meetings of Audit committee should be _____ in a year

a)      Three

b)      Four

c)       Five

d)      Six

4. SA 700 stands for:

a)      True and fair view of the company.

b)      Forming an opinion and reporting on Financial Statement.

c)       Qualified report.

d)      Disclaimer of opinion.

5. Audit report is meant for the _________ of the company.

a)      Shareholders

b)      Creditors

c)       Employees

d)      Bankers

6. Sec. 143 (12) of the Companies Act state that any ____ of the company has to be reported to central government.

a)      Fraud by officers or employees

b)      Errors in books of account

c)       Incomplete books of accounts

d)      Qualified report

7. Violation of section 143 (12) imply a fine of Rs. ___ lakh.

a)      One

b)      Two

c)       Three

d)      Four

8. An audit report is the final product of audit work by:

a)      Audit staff

b)      Auditor

c)       Management

d)      Internal auditor

Also read: Auditing MCQs (Multiple Choice Questions and Answers)

9. Caro 2016 is applicable to the:

a)      Banking Companies

b)      Insurance Companies

c)       One person Companies

d)      None of the above

10. CARO 2016 is applicable to the following private companies:

a)      Not a holding or subsidiary of a public company.

b)      Shareholder’s fund is less than 1 crore.

c)       Revenue less than or equal to Rs. 10 crores.

d)      Borrowing more than Rs. 1 crores in any time during financial year.

11. CARO 2016 is not applicable for foreign companies.                   False

12. The audit report should be signed in the personal name of the:

a)      Audit staff

b)      Auditor

c)       Management

d)      Internal auditor

13. An audit report is addressed to the authority appointing the Auditor.              True

14. A clean report is issued when, the auditor is satisfied with the:

a)      Fairness of Balance Sheet and Profit and Loss account.

b)      All the contents of the financial statements.

c)       Evidences, documents and explanation given by his clients.

d)      All of the above

15. The auditor gives a clean report when he doesn’t have any significant reservation in respect of matters contained in the Financial Statements.     True

16.  Audit report with reservations is knows as:

a)      Clean Report

b)      Qualified Report

c)       Adverse opinion

d)      Disclaimer of Opinion

17. Disclaimer of opinion is made when auditor is:

a)      Satisfied with the fairness of Balance Sheet and Profit and Loss account.

b)      Not agree with affirmation made by the management in the books.

c)       Unable to form overall opinion on Financial Statement

d)      All of the above.

18. Negative report is made when auditor is:

a)      Satisfied with the fairness of Balance Sheet and Profit and Loss account.

b)      Not agree with affirmation made by the management in the books.

c)       Unable to form overall opinion on Financial Statement

d)      All of the above.

19. A piecemeal opinion is issued when whole of the matters contained in the financial statement is true and fair. False, it is issued when complete information is not available.

20. A piecemeal opinion is issued when whole of the matters contained in the financial statement is true and fair.    True

Also read: Audit Report Complete Notes

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

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