3 Reworded CPA AUD Questions with Detailed Explanations
In this post, we’ll go over 3 carefully reworded CPA AUD exam questions. Each question includes the correct answer and a concise explanation to help you prepare effectively.
Question 1
Which document must be returned to the client, even if audit fees remain unpaid?
- A. Confirmations obtained during the audit
- B. Audit documentation created by the auditor
- C. Client-related documents prepared by the auditor
- D. Client-provided documents used during the audit
Correct Answer: D
Explanation: Documents originally provided by the client must be returned upon request, regardless of unpaid fees. These are not the property of the auditor and are not part of audit workpapers.
Key takeaway: Client-provided records always belong to the client and must be returned.
Question 2
Who is not considered a covered member under the AICPA Code of Professional Conduct?
- A. A partner in the same office as the engagement partner
- B. The firm’s managing partner located in another office
- C. A former auditor now working at a consulting firm serving the client
- D. The accounting firm and its benefit plan
Correct Answer: C
Explanation: A former auditor working at an outside consulting firm is generally not considered a covered member unless they still influence the audit. Covered members include those directly involved in or closely related to the audit engagement.
Key takeaway: Former employees at outside firms are usually not covered members.
Question 3
How should the auditor document the risk assessment in a nonissuer audit?
- A. Use a standardized format across all audits
- B. Fully document the industry background
- C. Adjust documentation based on entity size and complexity
- D. Keep it separate from the audit plan and strategy
Correct Answer: C
Explanation: The documentation should be tailored based on the entity's nature, size, and complexity. A one-size-fits-all format is not appropriate, and the risk assessment should align with the overall audit strategy.
Key takeaway: Risk assessment documentation must reflect the complexity of the audited entity.
This content is reworded and explained for educational purposes. Inspired by publicly released CPA exam content, modified for originality.