Auditing MCQ

Test your knowledge with important Auditing MCQ and their applications. These MCQs are beneficial for competitive exams too. Explore 30 + more Auditing MCQs at Bissoy

• Statement I: Management audit is a part of financial audit.<br>Statement II: Management audit is not compulsory under any law.
  ক

  Only statement I is true

  খ

  Only statement II is true

  গ

  Both statements are true

  ঘ

  Both statements are false
• In which type of energy audit readily available data is used to analyse the performance?
  ক

  General audit

  খ

  Preliminary audit

  গ

  Safety audit

  ঘ

  System audit
• Acontinuous audit is especially needed for
  ক

  Any trading organization

  খ

  Smaller concern

  গ

  Banking business

  ঘ

  Manufacturing companies
• The main objective of verification of assets is
  ক

  Physical verification of assets

  খ

  Checking the values of assets

  গ

  Examining the authority of their acquisition

  ঘ

  All of the above
• Interim audit refers to
  ক

  Continuous examination of accounts

  খ

  Intermittent examination of accounts

  গ

  Audit work to find and check the interim profits of a company

  ঘ

  Carrying on audit for bonus purpose at the end of the year
• Checking the date of voucher on the voucher during vouching, mainly helps the auditor to obtain evidence that
  ক

  The transaction relates to current year

  খ

  The transaction has taken place

  গ

  The transaction is genuine

  ঘ

  The transaction is legal
• The reason(s) of qualified report is/are
  ক

  Violation of generally accepted principles of auditing

  খ

  Violation of accounting principles

  গ

  Lack of adequate information and explanations

  ঘ

  All of the above
• Investigation is conducted:
  ক

  As a good inquiry

  খ

  To establish the correctness of the accounting records

  গ

  For some specific purpose

  ঘ

  As a constitutional requirement
• The auditor is most likely to examine related party transactions very carefully while vouching:
  ক

  Credit sales

  খ

  Sales returns

  গ

  Credit purchases

  ঘ

  Cash purchases
• Safety audit is mandatory for
  ক

  Manufacturing industries

  খ

  Hazardous industries

  গ

  Textile industries

  ঘ

  Mining industries
• In order to vouch, which of the expenses the auditor will examine in bill of entry?
  ক

  Customs

  খ

  Income tax

  গ

  GST

  ঘ

  VAT
• A company auditor can be removed before the expiry of his term by
  ক

  Shareholders

  খ

  Board of directors

  গ

  Central government

  ঘ

  State government
• The beneficiaries of auditing include(s)
  ক

  Company

  খ

  Bankers

  গ

  Sole proprietorship

  ঘ

  All of these
• The remuneration of an auditor of a partnership firm is fixed by
  ক

  The Partnership Act

  খ

  The Companies Act

  গ

  Government

  ঘ

  None of the above
• What is the maximum time limit for submitting management audit report?
  ক

  15 days

  খ

  20 days

  গ

  30 days

  ঘ

  No time limit
• Auditing is luxury for:
  ক

  Joint stock company

  খ

  Partnership firm

  গ

  Small shop-keeper

  ঘ

  Government company

  ঙ

  Co-operative society
• The value at which the assets are shown in the books of account is known as
  ক

  Book value

  খ

  Market value

  গ

  Cost value

  ঘ

  Replacement value
• The technique(s) of management audit is/are<br>1. Co-relation of information<br>2. Observation<br>3. Ratio analysis<br>4. Financial data analysis
  ক

  Only 2

  খ

  Both 2 and 3

  গ

  Both 1 and 4

  ঘ

  All of the above
• Which of the following are the rights of a Statutory Auditor?<br>1. To receive remuneration<br>2. To attend Board of Directors' Meeting<br>3. To attend the General Meeting<br>4. To visit the branch office<br>Choose the correct answer from the following:
  ক

  1 and 2

  খ

  1, 2 and 4

  গ

  1, 3 and 4

  ঘ

  1, 2, 3 and 4
• The main object of an audit of accounts of a joint-stock company is
  ক

  Detection and prevention of errors

  খ

  Detection and prevention of frauds

  গ

  Detection and prevention of errors and frauds

  ঘ

  To find out whether the balance sheet and profit and loss account are drawn up properly according to the Companies Act, and they represent a trace and fair view of the state of affairs
• The statutory auditor is duty-bound to :
  ক

  Review the managerial processes and procedures

  খ

  Prepare the final accounts of the company in accordance with the provisions of the company law

  গ

  Submit a report to the members of the company

  ঘ

  Verify physically the various assets of the company
• Which of the following acts do not have any coverage under Secretarial Audit?
  ক

  The Companies Act, 1956 and the rules made under there

  খ

  The Securities Contracts (Regulation) Act, 1956 ('SCRA') and the rules made under there

  গ

  Foreign Exchange Management Act, 1999 and the rules &amp; regulations made under there

  ঘ

  Specific Regulation of Securities and Exchange Board of India Act, 1992

  ঙ

  Payment of Bonus Act, 1965 and the rules under there
• Vouching helps the auditors to ascertain whether the entries in the book . . . . . . . . . , this is the basic objective of auditing.
  ক

  True and fair

  খ

  Only true

  গ

  Only fair

  ঘ

  None of these
• During the audit of accounts receivable, an auditor obtains sufficient and appropriate evidence in support of the existence assertion this evidence can be used to support which of the following assertions in respect of sales?
  ক

  Existence

  খ

  Cut-off

  গ

  Occurrence

  ঘ

  Completeness
• The area of operations in auditing includes
  ক

  Condition of appointment

  খ

  Needs of related law

  গ

  Both A and B

  ঘ

  Either A or B
• In vouching, salary register should be compared with
  ক

  Payment book

  খ

  Cashbook

  গ

  Wages register

  ঘ

  Cash voucher
• . . . . . . . . audit refers to the evaluation of a company's performance against planned goals in the areas of social responsibilities.
  ক

  Cost

  খ

  Social

  গ

  Interim

  ঘ

  Final
• The technique of management audit in which functions and achievements of two or more firms are compared, is called
  ক

  Comparative analysis

  খ

  Inter-firm comparison

  গ

  Routine check

  ঘ

  Ratio analysis
• Accounting for intangible assets is related to
  ক

  AS-10

  খ

  AS-12

  গ

  AS-24

  ঘ

  As-26
• The examination of cost accounts and statements is called
  ক

  Complete audit

  খ

  Interim audit

  গ

  Cost audit

  ঘ

  Internal audit