AICPA CPA-Auditing Exam - Topic 3 Question 37 Discussion

Actual exam question for AICPA's CPA-Auditing exam

Question #: 37
Topic #: 3

[All CPA-Auditing Questions]

For an entity that does financial statements generally would not refer to:

ASignificant estimates made by management.

BAn assessment of the entity's accounting principles.

CManagement's responsibility for the financial statements.

DThe entity's internal control.

Show Suggested Answer

Suggested Answer: D

Choice 'd' is correct. The auditor's standard report does not refer to the entity's internal control.

Choice 'a' is incorrect. The auditor's standard report refers to 'significant estimates made by management' in the scope paragraph.

Choice 'b' is incorrect. The auditor's standard report refers to 'assessments of the entity's accounting principles' in the scope paragraph.

Choice 'c' is incorrect. The auditor's standard report states management's responsibility for the financial statements in the introductory paragraph.

by Cecil at May 07, 2022, 06:53 PM

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Marvel

4 months ago

B is also a good point, but I feel like it’s more about A.

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Dominic

4 months ago

I agree with Lizbeth, A is the right choice here.

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Marguerita

4 months ago

Wait, are we really not talking about internal controls? That seems odd.

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Lizbeth

4 months ago

I think it’s A, management estimates are usually not highlighted.

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Tamra

5 months ago

Definitely not D, internal control is super important!

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Yaeko

5 months ago

Hmm, I'm a bit unsure about this one. The concepts of corporate criminal liability can be tricky. I'll need to think through each option and try to recall the key elements that are usually required.

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Joana

5 months ago

This is similar to a practice question where we ranked funds based on their risk-adjusted returns. I think I see a pattern.

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Francene

5 months ago

I practiced a similar question last week where we had to discount cash flows. I'm not entirely sure about the PI result though.

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Maryann

5 months ago

For money laundering questions, always look for methods that seem sophisticated but not overtly criminal. Option B feels most strategic.

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