The Objective of an Engagement Quality Review Is To

question 29

Multiple Choice

The objective of an engagement quality review is to:

• A) Assess how an audit has been conducted and the appropriateness of the audit opinion
• B) Assess the firm's own quality controls and the appropriateness of the audit opinion
• C) Assess how an audit has been conducted and the firm's own quality control procedures
• D) Assess whether materiality has been properly evaluated

---

Definitions:

Price Variance

The difference between the actual price paid for a purchase and the standard or expected price, usually applied to direct materials or direct labor costs.

Quantity Variance

A measure of the difference between the expected and actual quantities used in production, affecting materials or labor.

Overhead Absorbed

The overhead rate multiplied by standard units of volume.

Direct Labor Hours

The total amount of time spent by employees directly involved in manufacturing products or providing services.