AICPA Exam CPA-Auditing Topic 2 Question 78 Discussion

Actual exam question for AICPA's CPA-Auditing exam

Question #: 78
Topic #: 2

When auditing an entity's financial statements in accordance with Government Auditing Standards, an auditor should prepare a written report on the auditor's:

AIdentification of the causes of performance problems and recommendations for actions to improve operations.

BUnderstanding of internal control and assessment of control risk.

CField work and procedures that substantiated the auditor's specific findings and conclusions.

DOpinion on the entity's attainment of the goals and objectives specified by applicable laws and regulations.

Show Suggested Answer

Suggested Answer: A

Choice 'a' is correct. An auditor's communication of internal control related matters noted in an audit usually should be addressed to management and those charged with governance.

Choices 'b', 'c', and 'd' are incorrect. The director of internal auditing, the chief financial officer, and the chief accounting officer all would have access to the letter; however, it would not be addressed to them since they do not have the same level of authority and responsibility to the shareholders as management and those charged with governance.

by Alex at Dec 08, 2023, 04:07 PM

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