Auditing MCQs and Notes

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📊 Auditing
Q. The main object of investigation is :
  • (A) To discover errors and frauds.
  • (B) To prevent errors and frauds.
  • (C) To verify statements.
  • (D) All the above.
💬 Discuss
✅ Correct Answer: (D) All the above.
📊 Auditing
Q. Verification is :
  • (A) The art of recording the business transactions.
  • (B) An examination of the books of accounts.
  • (C) The act of establishing the accuracy of entries in the books of accounts.
  • (D) none
💬 Discuss
✅ Correct Answer: (C) The act of establishing the accuracy of entries in the books of accounts.
📊 Auditing
Q. The owners of the company are called:
  • (A) Debenture holders.
  • (B) Debtors.
  • (C) Shareholders.
  • (D) None of the above.
💬 Discuss
✅ Correct Answer: (C) Shareholders.
📊 Auditing
Q. The work of one clerk is automatically check by another clerk is called :
  • (A) Internal control.
  • (B) Internal check.
  • (C) Internal audit.
  • (D) None of the above.
💬 Discuss
✅ Correct Answer: (B) Internal check.
📊 Auditing
Q. A good audit report must at least meet one of the following qualifications:
  • (A) It should offer constructive and timely suggestions to the management.
  • (B) It should not point out mistakes.
  • (C) It should not be based on factual information.
  • (D) It should not be based on balance sheet.
💬 Discuss
✅ Correct Answer: (A) It should offer constructive and timely suggestions to the management.
📊 Auditing
Q. Auditing begins where -------- ends.
  • (A) Selling.
  • (B) Inventory valuation.
  • (C) Accounting.
  • (D) Purchases.
💬 Discuss
✅ Correct Answer: (C) Accounting.
📊 Auditing
Q. Internal auditor is appointed by :
  • (A) The management.
  • (B) The shareholders.
  • (C) The government.
  • (D) The statutory body.
💬 Discuss
✅ Correct Answer: (A) The management.
📊 Auditing
Q. Internal check is meant for :
  • (A) Prevention of frauds.
  • (B) Detection of frauds.
  • (C) Helping audit in depth.
  • (D) Detection of errors.
💬 Discuss
✅ Correct Answer: (C) Helping audit in depth.
📊 Auditing
Q. Voucher relates to :
  • (A) Cash receipt.
  • (B) Cash payment.
  • (C) Credit transactions.
  • (D) All the above.
💬 Discuss
✅ Correct Answer: (D) All the above.
📊 Auditing
Q. A number of checks & controls exercised in a business to ensure its efficient working is known as :
  • (A) Internal check.
  • (B) Internal control.
  • (C) Internal audit.
  • (D) Interim check.
💬 Discuss
✅ Correct Answer: (A) Internal check.

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