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Which of the following statements regarding analytical procedures is correct?

• Analytical procedures must be used as part of the overall review of the financial statements.

• Analytical procedures may be used as part of the overall review of the financial statements.

• Analytical procedures are only used as risk assessment procedures.

M Co has a year end of 31 July 20X5. The auditor completed the audit work on 10 September 20X5 and the auditor's report was signed on 30 September 20X5. The financial statements were issued on 1 November 20X5. Which of the following would be the most appropriate date for the directors to sign the written representations letter?

• 31 July 20X5

• 10 September 20X5

• 30 September 20X5

• 1 November 20X5

Q Co has a year end of 30 June 20X4. Management has assessed the ability of the company to continue as a going concern based on the period to 30 June 20X5. Which of the following procedures must the auditor perform to identify factors that may affect Z Co's ability to continue as a going concern beyond 30 June 20X5?

•  Analysis of cash flow forecasts

• Review of board minutes

• Review of loan terms

• Inquiry of management

M Co has a year end of 31 December 20X4. The auditor has identified that management's assessment of M Co's ability to continue as a going concern covers the period to 30 June 20X5. What action should the auditor take?

• Request that management extends the assessment period to 30 September 20X5

• Request that management extends the assessment period to 31 December 20X5

• Request that management extends the assessment period to 31 December 20X6

• No action is required provided the auditor is satisfied with management's assessment to 30 June 20X5

As part of the review stage of an audit, the auditor will consider subsequent events. Up to which date does the auditor have an active responsibility to perform procedures designed to identify subsequent events?

• The reporting date

• The date of the auditor's report

• The date of issue of the financial statements

• The date of approval of the financial statements

Auditors usually carry out their audit work at different stages known as the interim audit and the final audit. Which of the following statements, if any, is/are correct?

(1) Carrying out tests of control on the company's sales day books would normally be undertaken during an interim audit.

(2) Review of aged receivables ledger to identify balances requiring write down or allowance would normally be undertaken during a final audit.

•  Neither (1) or (2)

• Both (1) and (2)

• (1) only

• (2) only

During the planning stages of the final audit, the auditor believes that the probability of giving an inappropriate audit opinion is too high. How should the auditor amend the audit plan to resolve this issue?

• Increase the materiality level

• Decrease the inherent risk

• Decrease the detection risk

Which of the following must be included in an audit engagement letter?

• Arrangements concerning the use of experts

• Obligations to make audit working papers available to other parties

• Expected form and content of any reports

• Basis on which fees are computed

Which of the following statements is/are true with respect to analytical procedures?

(1) Analytical procedures can be used throughout the audit.

(2) Analytical procedures must be used as risk assessment procedures.

• (1) only

• (2) only

• (1) and (2)

• Neither (1) nor (2)

What are the purposes of planning the audit?

(1) To ensure appropriate attention is devoted to different areas of the

audit

(2) To identify potential problem areas

(3) To facilitate delegation of work to audit team members

(4) To ensure the audit is completed within budget and time restraints

• (1), (2), (3) and (4)

• (1), (3) and (4)

• (1), (2) and (3)

• (2) and (3)