ACCA AAA Practice Questions - ACCA Advanced Audit and Assurance (AAA) Exam - ACCA AAA Practice Questions - ACCA Advanced Audit and Assurance (AAA) Exam

Question 1

An audit firm has been approached by a company to provide both the statutory audit and the bookkeeping/financial statement preparation service for the same listed entity. Under the IESBA Code of Ethics, which threat is most directly created and why is this prohibited for a public interest entity (PIE)?

Self-review threat, because the firm would later audit financial statements it had prepared Intimidation threat, because management could pressure the audit team Familiarity threat, because long association builds trust Advocacy threat, because the firm promotes the client's position

Correct Answer:

Self-review threat, because the firm would later audit financial statements it had prepared

Question 2

During the audit of a manufacturing client, the engagement team identifies a transaction that appears designed to disguise the source of funds from an unrelated illegal activity. Under anti-money laundering (AML) requirements in many jurisdictions, what is the audit firm's appropriate primary response?

Resign from the engagement immediately and notify the client of the reason Make a suspicious activity report (SAR) to the relevant authority and avoid tipping off the client Disclose the suspicion to the client's audit committee and take no further action Adjust the audit opinion to a qualified opinion for the suspected amount

Correct Answer:

Make a suspicious activity report (SAR) to the relevant authority and avoid tipping off the client

Question 3

Under ISA 250 (Revised), Consideration of Laws and Regulations in an Audit of Financial Statements, the auditor distinguishes two categories of laws and regulations. Which statement correctly describes the auditor's responsibility for laws that have a direct effect on the determination of material amounts and disclosures?

The auditor only needs to remain alert to possible non-compliance The auditor has no responsibility because compliance is solely management's duty The auditor must obtain sufficient appropriate audit evidence regarding compliance The auditor must report all such laws to the regulator regardless of materiality

Correct Answer:

The auditor must obtain sufficient appropriate audit evidence regarding compliance

Question 4

A former audit partner left the firm and was appointed as the chief financial officer (CFO) of an audited listed client two months after the engagement concluded. Which ethical threat is created and what does the IESBA Code typically require for a key audit partner of a PIE in this situation?

No threat arises because employment after leaving the firm is unrelated to the audit Advocacy threat; immediate resignation of the whole engagement team Intimidation threat; rotation of the entire firm Self-interest threat; a cooling-off period before the individual may take a key management position with the client

Correct Answer:

Self-interest threat; a cooling-off period before the individual may take a key management position with the client

Question 5

An audit firm is concerned about potential professional liability following a negligence claim by a third-party lender who relied on audited financial statements. Which principle, established in case law such as Caparo Industries v Dickman, most limits the auditor's exposure to third parties?

A duty of care requires proximity and that reliance was reasonably foreseeable for a known purpose Auditors owe a duty of care to anyone who foreseeably might read the accounts Auditors are strictly liable for any loss arising from a material misstatement Liability can never be limited by any agreement or disclaimer

Correct Answer:

A duty of care requires proximity and that reliance was reasonably foreseeable for a known purpose

Question 1

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Prepare with the ACCA AAA Practice Questions - ACCA Advanced Audit and Assurance (AAA) Exam practice quiz. This question bank includes 100 questions covering audit, auditor, financial, client, and report. Use it to review important concepts, identify knowledge gaps, and build confidence for the related exam, course, or assessment.

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ACCA AAA Practice Questions - ACCA Advanced Audit and Assurance (AAA) Exam

This practice set contains 100 questions from the matching question bank and focuses on audit, auditor, financial, client, and report. Work through each question carefully, review the provided solutions, and revisit topics that need more study before your next attempt.

This is an independent study resource intended for practice and review; it is not an official examination or an endorsement by any organization named in the title.

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ACCA AAA Practice Questions - ACCA Advanced Audit and Assurance (AAA) Exam

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