| 1. |
Auditing refers to |
| A. | Preparation and checking of account |
| B. | Examination of accounts of business units only |
| C. | Examination of accounts of professional accountants |
| D. | Checking of vouchers |
| Answer» C. Examination of accounts of professional accountants | |
| 2. |
Main object of auditing is |
| A. | Detection of errors |
| B. | To find out whether P&L a/c & B/S show true and fair state affairs |
| C. | Detection of frauds |
| D. | Detection and prevention of frauds and errors. |
| Answer» B. To find out whether P&L a/c & B/S show true and fair state affairs | |
| 3. |
Auditing is luxury for a |
| A. | Joint stock company |
| B. | Partnership firm |
| C. | Small shop-keeper |
| D. | Government company |
| Answer» C. Small shop-keeper | |
| 4. |
Auditing is compulsory for |
| A. | Small scale business enterprises |
| B. | All partnership firms |
| C. | All joint stock companies |
| D. | All proprietary concerns |
| Answer» C. All joint stock companies | |
| 5. |
Propriety audit refers to |
| A. | Verification of accounts |
| B. | Examination accounts of propriety concerns |
| C. | Enquiry against justification and necessity of expresses |
| D. | Audit of Govt. companies |
| Answer» C. Enquiry against justification and necessity of expresses | |
| 6. |
Propriety is normally undertaken in case of |
| A. | Joint stock company |
| B. | Government company |
| C. | Statutory corporation |
| D. | Govt. departments |
| Answer» D. Govt. departments | |
| 7. |
Interim audit refers to |
| A. | Examination of accounts continuously |
| B. | Examination of accounts intermittently |
| C. | Audit work to find out and check interim profits of a company |
| D. | Carrying on audit for bonus purposes at the end of the year |
| Answer» C. Audit work to find out and check interim profits of a company | |
| 8. |
Final audit implies |
| A. | Audit of accounts at the end of the year |
| B. | Finally checking of accounts to reveal frauds |
| C. | Audit for submitting report immediately at the end of the year |
| D. | Audit of banking companies |
| Answer» A. Audit of accounts at the end of the year | |
| 9. |
A continuous audit is specially needed for |
| A. | Any trading concern |
| B. | Smaller concerns |
| C. | Banking companies |
| D. | Any manufacturing companies |
| Answer» C. Banking companies | |
| 10. |
Joint audit implies |
| A. | Audit of two concerns together |
| B. | Audit of joint stock companies |
| C. | Audit of joint sector companies |
| D. | Audit by two firms of C.A |
| Answer» D. Audit by two firms of C.A | |
| 11. |
Management audit means |
| A. | Audit undertaken on behalf of the management |
| B. | Evaluating performance of various management processes and functions |
| C. | Audit undertaken on behalf of Govt. to punish management |
| D. | Compulsory audit |
| Answer» B. Evaluating performance of various management processes and functions | |
| 12. |
Systems audit implies |
| A. | Systematic examination of accounts |
| B. | Audit undertaken to improve auditing systems |
| C. | Enquiring accounting and control systems |
| D. | Checking the performance of management |
| Answer» C. Enquiring accounting and control systems | |
| 13. |
Internal audit means |
| A. | Audit undertaken to ascertain truth and fairness of state of affairs |
| B. | Audit undertaken internally to evaluate management functions |
| C. | Audit undertaken by employees of the organization to check financial irregularities |
| D. | Audit by independent auditor to improve internal affairs |
| Answer» C. Audit undertaken by employees of the organization to check financial irregularities | |
| 14. |
Internal audit is |
| A. | Compulsory for a company with paid-up capital of Rs. 25 lakh and above |
| B. | Voluntary for a company |
| C. | Not necessary for a company |
| D. | Necessary for a company |
| Answer» B. Voluntary for a company | |
| 15. |
Internal audit is undertaken |
| A. | By independent auditor |
| B. | Statutorily appointed auditor |
| C. | By a person appointed by the management |
| D. | By Government auditor |
| Answer» C. By a person appointed by the management | |
| 16. |
Internal auditor is appointed by the |
| A. | Management |
| B. | Shareholders |
| C. | Government |
| D. | C & A-G |
| Answer» A. Management | |
| 17. |
The object of internal check is to |
| A. | Control wastage of resources |
| B. | Prevent errors and frauds |
| C. | Verify the cash receipts and payments |
| D. | Facilitate quick decision by the management |
| Answer» B. Prevent errors and frauds | |
| 18. |
Effective internal check system reduces |
| A. | The liability of auditor |
| B. | Work of auditor |
| C. | Both work as well as auditor |
| D. | Responsibilities of an auditor |
| Answer» B. Work of auditor | |
| 19. |
Internal check is a part of |
| A. | Internal audit |
| B. | Internal accounting |
| C. | External audit |
| D. | Internal control |
| Answer» D. Internal control | |
| 20. |
Internal check is carried on by |
| A. | Special staff |
| B. | Internal auditor |
| C. | Accountant |
| D. | None of the above |
| Answer» D. None of the above | |
| 21. |
Internal check is suitable for |
| A. | Larger concerns |
| B. | Smaller concerns |
| C. | Petty shop- keepers |
| D. | None of the above |
| Answer» A. Larger concerns | |
| 22. |
Internal check is carried on by |
| A. | Staff specially appointed for the purpose |
| B. | Internal auditor |
| C. | The members of the staff among themselves |
| D. | Supervisor of the staff |
| Answer» C. The members of the staff among themselves | |
| 23. |
Internal check is essential for |
| A. | Petty traders |
| B. | Cash transactions in a large concern |
| C. | A concern using automatic equipments |
| D. | None of the above |
| Answer» B. Cash transactions in a large concern | |
| 24. |
Misappropriation of goods may be checked by |
| A. | Proper supervision over stock |
| B. | Checking of employees |
| C. | Punishment of employees |
| D. | None of the above |
| Answer» A. Proper supervision over stock | |
| 25. |
Window dressing implies |
| A. | Curtailment of expenses |
| B. | Checking wastages |
| C. | Under- valuation of assets |
| D. | Over- valuation of assets |
| Answer» D. Over- valuation of assets | |
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