CPA Auditing and Attestation (AUD) › Types of Engagements - Integrated Audits
Each of the following types of controls is considered to be an entity-level control, except those:
Pertaining to the company's risk assessment process
Regarding the company's annual shareholder meeting
Addressing policies over significant risk management policies
Relating to the control environment
Entity level controls include controls related to the control environment, the risk assessment process, and the policies over risk management policies. Controls regarding the company's annual shareholder meeting are controls related to a specific event rather than the entity as a whole.
Internal control over financial reporting consists of which component?
Risk assessment
Existing control activities
Monitoring
All of these components
The components not listed would include Information and communication and control environment. These 5 components make up ICFR.
As described by PCAOB auditing standard number 2, an effective internal control
Will disclose all internal control weaknesses
Is designed to uncover fraud
Is not effective if there is any material weakness
Is not effective if there are more than two immaterial weaknesses
According to PCAOB Accounting Standards: “Maintaining effective internal control over financial reporting means that no material weaknesses exist; therefore, the objective of the audit of internal control over financial reporting is to obtain reasonable assurance that no material weaknesses exist as of the date specified in management's assessment.”
An integrated audit
Is not required by privately held companies
Is only required by large public companies
Both A and B
Neither A and B
An integrated audit is not required by private corporations. The integrated audit is performed under PCAOB standards that govern public companies.
Integrated audits are regulated by the:
PCAOB
AICPA
ASB
IFRS
Integrated audits are regulated under PCAOB standard number 5.
Of the following, which is true regarding PCAOB standards surrounding internal control?
The PCAOB has not issued standards surrounding internal control
PCAOB standards surrounding internal control apply only to audit of nonissuers
All auditors must follow PCAOB standards surrounding internal control
PCAOB standards surrounding internal control apply only to audits of issuers
PCAOB standards surrounding internal control apply only to audits of issuers.