Auditing MCQs
Auditing MCQs cover audits, controls, standards, planning, procedures, risks, and reporting—ideal for ACCA, CA, ICMA, B.Com, MBA, and finance exams, ensuring conceptual clarity and practical application for academic and professional success.
Q: Internal controls are reviewed to assess
A) Stakeholder return
B) Company size
C) Efficiency of system
D) Cash flow
✅ Correct Answer: C
Explanation: Reviewing controls helps auditors determine the effectiveness of risk management.
Q: Responsibility of auditor in fraud detection is to
A) Assist in covering it
B) Prevent it
C) Plan audit to detect fraud
D) Ignore small frauds
✅ Correct Answer: C
Explanation: While auditors are not responsible for preventing fraud, they plan audits to detect any material fraud.
Q: Sampling technique used in audit is based on
A) Materiality
B) Legal requirement
C) Volume
D) Size of firm
✅ Correct Answer: A
Explanation: Sampling depends on materiality and the auditor’s judgment on risk areas.
Q: Verification of liabilities ensures
A) Accuracy of entries
B) Inventory count
C) Payment is made
D) Vouchers are signed
✅ Correct Answer: A
Explanation: Checking liabilities ensures that obligations are recorded correctly and completely.
Q: Audit of government departments is performed by
A) Internal auditor
B) Chartered accountant
C) Finance officer
D) Auditor general
✅ Correct Answer: D
Explanation: The Auditor General is responsible for auditing government accounts.