The Auditors Are Planning an Audit Engagement for a New

question 46

Multiple Choice

The auditors are planning an audit engagement for a new client in a business that is unfamiliar to the auditors. Which of the following would be the most useful source of information for the auditors during the preliminary planning stage when they are trying to obtain a general understanding of audit problems that might be encountered?

• A) Client manuals of accounts and charts of accounts.
• B) AICPA Industry Audit Guides.
• C) Prior-year working papers of the predecessor auditors.
• D) Latest annual and interim financial statements issued by the client.

Comprehend the principles of probability and how it describes the likelihood of occurrences.

Identify independent and dependent events in various contexts.

Apply probability principles to predict outcomes in real-life scenarios.

Interpret sample spaces and construct them for given scenarios.