📏CPA EXAM PREP

Ethics and General Principles

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Question

How does a review differ from an audit in assurance level?

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Answer

A review provides limited, negative assurance.

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Question

What are the two components of independence in an audit engagement?

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Answer

Independence of mind and independence in appearance.

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Question

Why is a direct financial interest in an attest client always a problem?

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Answer

It creates a bright-line independence impairment.

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Question

How is a self-review threat created by bookkeeping for an audit client?

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Answer

The auditor later audits records it prepared.

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