Limitation of audit is

That it does not reveal complete picture

That it does not guarantee accuracy of accounts

What does the Sarbanes-Oxley Act of 2002 stipulates?

The company should appoint independent financial experts to its audit committee

A public account oversight board to be created

CEO and CFO sign off the company s financial statements

Which of the following is not the procedure for vouching of cash sales:

Examine the counterfoil of pay in slops

To verify cash transactions, it is necessary

Documentary evidence for every transaction

Which of the following is not a OECD principle

Ensuring the basis for an effective corporate governance framework

The responsibilities of the government and bureaucrats

Ensuring the basis for an effective corporate governance framework

The equitable treatment of shareholders

Corporate scams or scandals arise with the disclosure of

Misdeeds by trusted executive s of small public corporations

Misdeeds by trusted executives of large public corporations

Misdeeds by trusted executive s of small public corporations

The full form of CAAT

Computer Assistance Alternate Techniques

Computer Assisted Audit Techniques

Computer Assistance Alternate Techniques

Computer Audit Assistance Technique

Customer Assisted Audit Technique

Which of the following is not rating agencies?

CRISIL s Governance and Value Creation rating

CARE s Corporate Governance Rating

ICRA s Corporate Governance Rating

ICICI s Corporate Governance Rating

In case of sales return, the auditor should check.

Credit notes and delivery challans.

Whether cash has been repaid to the client

Purchase invoices and goods received notes.

Credit notes and goods received notes.

Which of the following is an importance of vouching?

Ensures all items are disclosed in the financial statement as per Schedule VI provisions

It helps to verify whether entries are passed as per acceptable accounting principles.

Helps in detection and prevention of errors & frauds

The elements of auditing includes

Systematic and independent examination

Collects and evaluates the evidence

We need to conduct management audit for

Taking over and reviving sick units

Which of the following is (are) true of the EDP auditors?

They will be replaced by traditional auditors in the near future

They should have computer expertise

They will be replaced by traditional auditors in the near future

Currently, there is a very high demand from firms that use personal computers

Management Audit assess the efficiency of management for third parties to commit funds for the business in situation such as

Granting loans or participation in equity

Tax audit comprises of

Tax Audit for claiming deductions and exemptions

Who among the following can conduct tax audit?

A Chartered Accountant who has written the books of assessee

Practicing Chartered Accountant

A Chartered Accountant who has written the books of assessee

For an assesse carrying on business in India, deductions allowed under Section 33AB includes businesses of

Growing and manufacturing of tea

Growing and manufacturing of coffee

Growing and manufacturing of rubber

Selecting and printing audit samples, comparing data on separate files, comparing audit data with clients records

Functions of Generalized Audit Software

Cost audit is the verification of the correctness of cost accounts and adherence to the cost accounting plan. This concept is given by

Institute Of Chartered Accountant Of India

Institute Of Chartered Accountant Of London

Institute Of Cost and Works Accountants of India

Institute Of Cost and Works Accountants of London.

Objective of management audit are

To evaluate the performance by relating inputs with output

To obtain efficiency and effectiveness of management

The corporate governance framework consists of explicit and implicit contracts between

Management and State government

175 + Mcqs in Auditing Corporate Governance in Bachelor of Commerce (B Com) Page 1 McqOptions

1.	The term auditing was associated with
A.	Hearing of accounts
B.	Hearing of system
C.	Hearing of report
D.	None of the above
Answer» B. Hearing of system

Discussion

2.	Who is responsible for the verification of assets?
A.	Auditor
B.	Management
C.	Director
D.	None of the above
Answer» B. Management

Discussion

3.	Limitation of audit is
A.	That it does not reveal complete picture
B.	That it does not guarantee accuracy of accounts
C.	That auditor may be biased
D.	All of the above
Answer» E.

Discussion

4.	The scope of auditing is
A.	Narrow
B.	Wide
C.	Long
D.	Short
Answer» C. Long

Discussion

5.	Institute of Chartered Accountants of India was established on
A.	1 st April,1956
B.	1 stApril, 1949
C.	1 st July,1956
D.	1 st July,1949
Answer» E.

Discussion

6.	The arrangement of duties of staff in such a manner, that the work of one person is automatically checked by another during the course of carrying out, recording and processing a transaction.
A.	Internal check
B.	Internal audit
C.	Vouching
D.	Internal control
Answer» B. Internal audit

Discussion

7.	The process of inspecting a document that supports a recorded transaction in order to verify the authority and authenticity of such a transaction
A.	Auditing
B.	Audit planning
C.	Vouching
D.	Internal check
Answer» D. Internal check

Discussion

8.	What does the Sarbanes-Oxley Act of 2002 stipulates?
A.	The company should appoint independent financial experts to its audit committee
B.	A public account oversight board to be created
C.	CEO and CFO sign off the company s financial statements
D.	All of the above
Answer» E.

Discussion

9.	Which of the following is not the procedure for vouching of cash sales:
A.	Examine cash book
B.	Examine cash memos
C.	Examine the counterfoil of pay in slops
D.	Examine balance sheet
Answer» E.

Discussion

10.	The object of internal audit is
A.	To detect frauds and errors
B.	To prevent frauds and errors
C.	Both (a) and (b)
D.	Neither (a) nor (b)
Answer» B. To prevent frauds and errors

Discussion

11.	Which of the following object is not included while verifying the liabilities by the auditor?
A.	Existence
B.	Obligation
C.	Completeness
D.	All of the above
Answer» E.

Discussion

12.	To verify cash transactions, it is necessary
A.	System of internal control
B.	Check all transaction
C.	Documentary evidence for every transaction
D.	All of the above.
Answer» E.

Discussion

13.	The audit that is made compulsory under statute is called _________.
A.	Statutory audit.
B.	Partial audit.
C.	Complete audit.
D.	Continuous audit.
Answer» B. Partial audit.

Discussion

14.	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.
Answer» C. Internal audit.

Discussion

15.	A person who exposes any kind of information or activity that is deemed illegal, unethical, or not correct within an organisation that is either private or public
A.	Whistle blower
B.	Legal protector
C.	Broker
D.	None of the above
Answer» B. Legal protector

Discussion

16.	Corporate governance is primarily about
A.	values
B.	rules
C.	profits
D.	legal framework
Answer» B. rules

Discussion

17.	Which of the following is not a OECD principle
A.	The responsibilities of the government and bureaucrats
B.	Ensuring the basis for an effective corporate governance framework
C.	Disclosure and transparency
D.	The equitable treatment of shareholders
Answer» B. Ensuring the basis for an effective corporate governance framework

Discussion

18.	Corporate scams or scandals arise with the disclosure of
A.	Misdeeds by trusted executives of large public corporations
B.	Misdeeds by trusted executive s of small public corporations
C.	(a) and (b)
D.	Only (a)
Answer» B. Misdeeds by trusted executive s of small public corporations

Discussion

19.	An organization s appropriate tone at the top promoting ethical conduct is an example
A.	Ethics sensitivity
B.	Ethics incentives
C.	Ethical behavior
D.	Consequentialist.
Answer» D. Consequentialist.

Discussion

20.	The full form of CAAT
A.	Computer Assisted Audit Techniques
B.	Computer Assistance Alternate Techniques
C.	Computer Audit Assistance Technique
D.	Customer Assisted Audit Technique
Answer» B. Computer Assistance Alternate Techniques

Discussion

21.	Which of the following is not rating agencies?
A.	CRISIL s Governance and Value Creation rating
B.	CARE s Corporate Governance Rating
C.	ICRA s Corporate Governance Rating
D.	ICICI s Corporate Governance Rating
Answer» E.

Discussion

22.	In case of sales return, the auditor should check.
A.	Credit notes and delivery challans.
B.	Whether cash has been repaid to the client
C.	Purchase invoices and goods received notes.
D.	Credit notes and goods received notes.
Answer» E.

Discussion

23.	Which of the following is an importance of vouching?
A.	Ensures all items are disclosed in the financial statement as per Schedule VI provisions
B.	It helps to verify whether entries are passed as per acceptable accounting principles.
C.	Helps in detection and prevention of errors & frauds
D.	All the above
Answer» E.

Discussion

24.	The elements of auditing includes
A.	Systematic and independent examination
B.	Stated purpose
C.	Collects and evaluates the evidence
D.	All of the above
Answer» E.

Discussion

25.	Which of the following is not audit software?
A.	Generalized Audit Software
B.	Specialized Audit Software
C.	Utility Software
D.	Micro Software
Answer» E.

Discussion

26.	We need to conduct management audit for
A.	Taking over and reviving sick units
B.	Helps in foreign collaboration
C.	(a) and (b)
D.	None of the above .
Answer» D. None of the above .

Discussion

27.	Which of the following is (are) true of the EDP auditors?
A.	They should have computer expertise
B.	They will be replaced by traditional auditors in the near future
C.	Currently, there is a very high demand from firms that use personal computers
D.	None of the above
Answer» B. They will be replaced by traditional auditors in the near future

Discussion

28.	Audit software includes
A.	Generalized Audit Software
B.	Specialized Audit Software
C.	Utility Software
D.	All of the Above
Answer» E.

Discussion

29.	Management Audit assess the efficiency of management for third parties to commit funds for the business in situation such as
A.	Granting loans or participation in equity
B.	Reviving sick units
C.	Foreign collaborations
D.	All of the above
Answer» E.

Discussion

30.	Under the Companies Act, 2013 a cost auditor must be a cost accountant having certificate of practice issued by the institute of Cost Accountants of India as per
A.	Section 148
B.	Section 147
C.	Section 150
D.	Section 151
Answer» B. Section 147

Discussion

31.	Compulsory Tax Audit U/S 44AB is applicable for
A.	8 categories of Assessees
B.	6 categories of Assessees
C.	2 categories of Assessees
D.	4 categories of Assessees
Answer» E.

Discussion

32.	Tax audit comprises of
A.	Compulsory Tax Audit
B.	Tax Audit for claiming deductions and exemptions
C.	Selective Tax Audit
D.	All of the above
Answer» E.

Discussion

33.	The section which contains provisions regarding compulsory Tax Audit is
A.	Section 44AD
B.	Section 44BB
C.	Section 44AB
D.	Section 44AE
Answer» D. Section 44AE

Discussion

34.	Who among the following can conduct tax audit?
A.	Practicing Chartered Accountant
B.	A Chartered Accountant who has written the books of assessee
C.	Employee of the assessee
D.	Internal auditor
Answer» B. A Chartered Accountant who has written the books of assessee

Discussion

35.	For an assesse carrying on business in India, deductions allowed under Section 33AB includes businesses of
A.	Growing and manufacturing of tea
B.	Growing and manufacturing of coffee
C.	Growing and manufacturing of rubber
D.	All of the above
Answer» E.

Discussion

36.	The ------- can be removed after the expiry of his term of office,as per the procedures laid down in section 225.
A.	BOD
B.	Clerk
C.	Auditor
D.	Shareholders.
Answer» D. Shareholders.

Discussion

37.	Transactions entered in the computer as they occur and processed simultaneously in the processing capabilities of accounting system is
A.	Batch processing system
B.	Real-time processing system
C.	Distributed Data processing
D.	None of the above
Answer» C. Distributed Data processing

Discussion

38.	Selecting and printing audit samples, comparing data on separate files, comparing audit data with clients records
A.	Functions of Generalized Audit Software
B.	Integrated Test Data Approach
C.	Test Data Approach
D.	All of the above
Answer» B. Integrated Test Data Approach

Discussion

39.	The corporate governance structure of a company reflects the individual companies is
A.	Cultural and economic system
B.	Legal and business system
C.	Social and regulatory system
D.	All of the above
Answer» E.

Discussion

40.	Compliance with standard of Auditing is the responsibility of
A.	Management
B.	Those charged with governance
C.	Auditor
D.	Audit committee
Answer» D. Audit committee

Discussion

41.	If the auditor is unable to draw reasonable assurance, he should either withdraw from engagement if permitted by law or disclaim his opinion, is given in which Standard on Auditing.
A.	SA500
B.	SA200
C.	SA705
D.	SA700
Answer» C. SA705

Discussion

42.	An appointed auditor may be removed from his office either in accordance with the provisions and as per restrictions imposed by the
A.	Companies Act
B.	Chartered Accountants Act
C.	Both (a) and (b)
D.	None of the above.
Answer» D. None of the above.

Discussion

43.	Cost audit is the verification of the correctness of cost accounts and adherence to the cost accounting plan. This concept is given by
A.	Institute Of Chartered Accountant Of India
B.	Institute Of Chartered Accountant Of London
C.	Institute Of Cost and Works Accountants of India
D.	Institute Of Cost and Works Accountants of London.
Answer» E.

Discussion

44.	Cost audit helps in settlement of trade disputes. This is the advantage for
A.	Government
B.	Management
C.	Society
D.	Shareholders .
Answer» D. Shareholders .

Discussion

45.	The audit of financial records to ascertain the correctness of taxable profits means
A.	Tax audit
B.	Management audit
C.	Profit audit
D.	Financial audit .
Answer» B. Management audit

Discussion

46.	According to section 44AB,Tax Audit is to be conducted by an
A.	Internal auditor
B.	Chartered Accountant
C.	Accountant
D.	None of the above .
Answer» C. Accountant

Discussion

47.	Objective of management audit are
A.	To evaluate the performance by relating inputs with output
B.	To obtain efficiency and effectiveness of management
C.	Only (b)
D.	(a) and (b).
Answer» E.

Discussion

48.	Future oriented, independent and systematic evaluation of the activities of all levels of management for the purpose of improving organizational profitability and increasing the attainment of other organizational objectives is known as
A.	Cost audit
B.	Tax audit
C.	Management audit
D.	Human resources audit .
Answer» D. Human resources audit .

Discussion

49.	The corporate governance framework consists of explicit and implicit contracts between
A.	Company and the stakeholders
B.	Management and State government
C.	Stakeholders and Management
D.	None of the above
Answer» B. Management and State government

Discussion

50.	Report of Cost audit should be submitted to
A.	Shareholders
B.	Company Law Board
C.	Central Government
D.	All of the above
Answer» D. All of the above

Discussion

Explore topic-wise MCQs in Bachelor of Commerce (B Com).

The term auditing was associated with

Who is responsible for the verification of assets?

Limitation of audit is

The scope of auditing is

Institute of Chartered Accountants of India was established on

The arrangement of duties of staff in such a manner, that the work of one person is automatically checked by another during the course of carrying out, recording and processing a transaction.

The process of inspecting a document that supports a recorded transaction in order to verify the authority and authenticity of such a transaction

What does the Sarbanes-Oxley Act of 2002 stipulates?

Which of the following is not the procedure for vouching of cash sales:

The object of internal audit is

Which of the following object is not included while verifying the liabilities by the auditor?

To verify cash transactions, it is necessary

The audit that is made compulsory under statute is called _________.

The work of one clerk is automatically check by another clerk is called

A person who exposes any kind of information or activity that is deemed illegal, unethical, or not correct within an organisation that is either private or public

Corporate governance is primarily about

Which of the following is not a OECD principle

Corporate scams or scandals arise with the disclosure of

An organization s appropriate tone at the top promoting ethical conduct is an example

The full form of CAAT

Which of the following is not rating agencies?

In case of sales return, the auditor should check.

Which of the following is an importance of vouching?

The elements of auditing includes

Which of the following is not audit software?

We need to conduct management audit for

Which of the following is (are) true of the EDP auditors?

Audit software includes

Management Audit assess the efficiency of management for third parties to commit funds for the business in situation such as

Under the Companies Act, 2013 a cost auditor must be a cost accountant having certificate of practice issued by the institute of Cost Accountants of India as per

Compulsory Tax Audit U/S 44AB is applicable for

Tax audit comprises of

The section which contains provisions regarding compulsory Tax Audit is

Who among the following can conduct tax audit?

For an assesse carrying on business in India, deductions allowed under Section 33AB includes businesses of

The ------- can be removed after the expiry of his term of office,as per the procedures laid down in section 225.

Transactions entered in the computer as they occur and processed simultaneously in the processing capabilities of accounting system is

Selecting and printing audit samples, comparing data on separate files, comparing audit data with clients records

The corporate governance structure of a company reflects the individual companies is

Compliance with standard of Auditing is the responsibility of

If the auditor is unable to draw reasonable assurance, he should either withdraw from engagement if permitted by law or disclaim his opinion, is given in which Standard on Auditing.

An appointed auditor may be removed from his office either in accordance with the provisions and as per restrictions imposed by the

Cost audit is the verification of the correctness of cost accounts and adherence to the cost accounting plan. This concept is given by

Cost audit helps in settlement of trade disputes. This is the advantage for

The audit of financial records to ascertain the correctness of taxable profits means

According to section 44AB,Tax Audit is to be conducted by an

Objective of management audit are

Future oriented, independent and systematic evaluation of the activities of all levels of management for the purpose of improving organizational profitability and increasing the attainment of other organizational objectives is known as

The corporate governance framework consists of explicit and implicit contracts between

Report of Cost audit should be submitted to