Page 37 - CA Inter MCQ Book

CA RAVI TAORI CA INTER AUDIT MCQs

Part 04-SA 510

510.1 M19M/N19R/M20M/SM21
If the auditor is unable to obtain sufficient appropriate audit evidence regarding the opening

balances, the auditor shall express :
a) a disclaimer opinion
b) a qualified opinion
c) a qualified opinion or a disclaimer of opinion, as appropriate, in accordance with SA 705.
d) unmodified opinion

510.2 N19M
If the auditor is unable to obtain sufficient appropriate audit evidence regarding the opening

balances,
a) the auditor shall express a qualified opinion in accordance with SA 705.
b) the auditor shall express a disclaimer of opinion in accordance with SA 705.
c) the auditor shall express a qualified opinion or adverse opinion, as appropriate, in accordance
with SA 705.
d) the auditor shall express a qualified opinion or a disclaimer of opinion, as appropriate, in
accordance with SA 705.

Part 05-SA 520

520.1 SM21
Analytical procedures issued in the planning stage of an audit, generally:
a) helps to determine the nature, timing and extent of other audit procedures
b) directs attention to potential risk areas
c) indicates important aspects of business
d) All of the above

520.2 #Unique M19R
Marvin Ltd. is a renowned food chain supplier in a posh area providing restaurant facility along with
food delivering. CA. Felix was appointed as an auditor of the company for the Financial Year 2017-
18. While examining the books of account of the company, CA. Felix came to know about one of the

major expenses of the company i.e. rent expense of Rs. 1,20,000 per month, for which he applied
substantive analytical procedure for verification purpose. Explain, how would CA. Felix perform
substantive analytical procedure in the given scenario?
a) CA. Felix would inspect every single rent invoice per month of Rs. 1,20,000 and verify other
elements appropriately.
b) CA. Felix would compare the rental expense of the company with that of another nearby
company having corresponding dimensions, for high degree of accuracy.
c) CA. Felix would select the first month rent invoice of Rs. 1,20,000 and appropriately verifying
other elements would predict that the rent for the whole year would be Rs. 14,40,000 (i.e., Rs.
1,20,000 * 12). Thereafter, he would compare the actuals with his prediction and follow-up for
any fluctuation.
d) (a) and (b), both.

520.3 #Unique N19M/SM21
Which of the following is not an analytical procedure
a) Tracing of purchases recurred in the purchase book to purchase invoices.
b) Comparing aggregate wages paid to number of employees
c) Comparing the actual costs with standard costs
d) All of them are analytical procedure

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