Multiple Choice Questions:

1. An elected State Auditor, employed by the State, would NOT be considered independent when auditing which of the following entities?

a. A component unit of the State.

b. An agency of the State.

c. The office of the State Auditor.

d. All of the above.

2. An independent CPA is engaged to audit the financial statements of the City of Highland Hills. The City has a variety of revenue sources including a $350,000 grant from the U.S. Department of Housing and Urban Development. Which of the following audit standards must the CPA use when conducting the audit?

a. The AICPA audit standards.

b. The GAO audit standards.

c. The OMB audit standards.

d. All of the above.

3. Circular A-133, issued by the Office of Management and Budget,

a. Applies only to state and local governmental units

b. Applies only to not-for-profit organizations

c. Applies to both

d. Applies to neither

4. GAO standards specify that performance audit reports should be timely and include several items. Which of the following items is NOT required under the GAO standards?

a. Significant audit findings.

b. Recommendation as to how to correct problems.

c. Explanation of the audit's objectives and of its scope and methodology.

d. Details about the number of items tested and the sampling techniques used.