GẦN H4 x o™ Ne , ` œ HNIN (M9 © G + {RUONG % we ay yo 2 by, 5 7 ` V6 Universi
Time allowed: 75 MINUTES
THE BANKING UNIVERSITY OF HO CHI MINH CITY FALCULTY OF ACCOUNING AND AUDITING FINAL EXAMINATION Exam paper: PRINCIPLES OF AUDITING Class: AUD301_ 1921 5 L09 TA Student’s full name: Supervisor: Marker: 1 1 Class: Students ID: 2 2
Question 1: (2 marks) (Write your answer for Question I in the answer boxes below)
1.1 Explain 2 differences between internal and external audit
Criteria Internal audit External audit
1.2 For each situation below, identify the threat to the audit and suggest necessary related safeguards
Situation Threat Safeguards
1 During the audit, the auditor
has informed the audit firm that his
brother has been appointed as CEO
of the audit client ,
Trang: 1/2
Trang 2
2 Prior to the audit of ABC Co, the engagement audit partner had been providing accounting and taxation services to ABC Co for many years
Question 2: (3 marks)
2.1 What is internal control? Explain 2 major factors of the control environment 2.2 What is the purpose of test of controls? Give 4 examples of test of controls? 2.3 Suggest control activities to prevent the following deficiencies in the sales system: - Goods can be supplied to a customer with bad credit risk
- No evidence is obtained from customers that they have accepted delivery of their goods
Question 3: (3 marks)
3.1 Describe audit procedures to gain evidence for following audit objectives: - All sales transactions have been recorded in the sales journal
- The entity has the right/ownership to the tangible fixed assets it is reporting
3.2 You are involved with the audit of Green Co, a small company You have been carrying out
procedures to gain an understanding of the entity The following matters have come to your attention: “The company carries high levels of inventory and, due to constant changes in fashion, often sells product lines at prices lower than cost The company offers standard credit terms to its customers of 60 days from the date of invoice Statements are sent to customers on a quaterly basis and Green Co does not produce an aged list of balances.“ Required From the above information, assess the risks of material misstatement in the financial statements Question 4: (2 marks) 4.1 Explain the differences between the following forms of modified audit opinion: - Disclaimer - Adverse opinion
4.2 State with reasons the type of audit report that should be issued in each situation below:
- A major customer of the audit client declared bankruptcy but management refuses to charge off the account or otherwise disclose the information
- The client does not allow the auditor to observe the year-end stocktaking to obtain sufficient audit evidence for inventories
Note: - This is a closed book test No material is allowed