Which of the following statements is not correct regarding removal of first auditor before expiry of the term?
A. He is removed at a general meeting
B. The shareholders are authorized to do so
C. The approval of the Central Government is required for such removal
D. None of these
Select an option to see the answer and solution.
Civil liability of an auditor implies liability for:
A. Misappropriation of cash
B. Misappropriation of goods
C. Fraud
D. Misfeasance
E. Not checking accounts properly
Select an option to see the answer and solution.
Which of the following is not an inherent limitation of internal control system?
A. Management override
B. Collusion among employees
C. Inefficiency of internal auditor
D. Abuse of authority
Select an option to see the answer and solution.
A Statutory Auditor of a private limited company is duty-bound to submit his report to:
A. The financial institutions
B. The Government through the Registrar of Companies
C. The Managing Director of the Company
D. The Shareholders of the Company in the Annual General Meeting
Select an option to see the answer and solution.
When auditing prepaid insurance, an auditor discovers that the insurance policy bond on building is not available for inspection. This may indicate:
A. No insurance has been undertaken for building
B. Lien on building
C. Insurance premium has not been paid
D. Insurance premium paid but not recorded
Select an option to see the answer and solution.
The scope of internal audit is decided by the:
A. Shareholders
B. Management
C. Government
D. Law
Select an option to see the answer and solution.
If the Board of Directors fails to appoint the first auditor, then the first auditor is appointed by
A. Company in its annual general meeting
B. Central Government
C. Registrar
D. Company Law Board
Select an option to see the answer and solution.
Balance Sheet audit is useful when:
A. Concern is very large
B. Concern is very small
C. Internal check is weak
D. No audit system exists
Select an option to see the answer and solution.
"Cost Audit" means:
A. Audit by a Cost Accountant
B. Audit of Cost Account
C. Auditing the Cost of Goods produced
D. None of these
Select an option to see the answer and solution.
Floating assets are valued at:
A. Cost
B. Market price
C. Cost or market price whichever is lower
D. Cost less depreciation
Select an option to see the answer and solution.
"Disclaimer of Opinion" is issued, when the Auditor is-
A. unable to frame an opinion
B. in disagreement with the records kept by the management
C. not in an agreement with the stand taken by the management in respect of a material issue
D. None of these
Select an option to see the answer and solution.
For all audits of financial statements made in accordance with AAS14, the use of analytical procedures is at the discretion of the auditor in which stage?
A. Substantive testing
B. Planning stage
C. Overall review stage
D. All of the above
Select an option to see the answer and solution.
Internal auditor is appointed by:
A. Shareholders
B. Statutory auditor
C. Institute of Internal Auditors of India
D. Board of Directors
Select an option to see the answer and solution.
The performance of tests of control is documented in:
A. Audit programme
B. Flow charts
C. Working papers
D. Any of the above
Select an option to see the answer and solution.
An auditor is like a:
A. Blood haunt
B. Watch dog
C. May both according to situation
D. None of these
Select an option to see the answer and solution.
Which among the following is not associated with an advantage of audit?
A. Correct settlement of claim from the insurance company
B. Borrowings from the banks made easy
C. Income tax authority generally accepts the audited accounts to be correct
D. It facilitates the settlement of the accounts of a deceased partner
E. To engage the accountants for the whole of the year to prepare segment wise accounting records for verification
Select an option to see the answer and solution.
Which of the following is not the duty of a company auditor:
A. To make a report to the members of the company on the accounts examined by him
B. To enquire whether loans and advances made by the company on the basis of security have been properly secured
C. Where it is stated in the books of the company that shares have been allotted for cash, to enquire whether cash has actually been received in respect of such allotment
D. To physically verify the value of stock in hand at the close of the year
Select an option to see the answer and solution.
Who can check the minute book?
A. Shareholder - without any fee
B. Debentureholder - on payment of fee
C. any person - on payment of fee
D. None of the above
Select an option to see the answer and solution.
The retiring auditor does not have a right to
A. make written representations
B. get his representations circulated
C. be heard at the meeting
D. speak as a member of the company
Select an option to see the answer and solution.
The work of continuous auditor is
A. loose
B. medium
C. Sharp
D. Similar
Select an option to see the answer and solution.