True or False 1. 2. 3. 4. 5. 6. 7. 8. 4.7 End-of-Chapter Exercises The quality or a company's mucina controls has no effect on the work of an auditor. Acquiring the CPA designation requires a candidate to pass an exam, meet education requirements, and meet experience requirements. The SEC is the current accounting standard setting body in the United States. The inclusion of an explanatory paragraph in an audit report is an indication that the financial statements should not be relied on. The PCAOB oversees auditors of public companies. Nonpublic companies have no reason to have an audit of their financial statements performed. If one manager approval is a good internal control then two approvals is always better. An individual who handles cash should not also be able to do the record keeping for cash. Audits are paid for by the creditors and investors of a company. 9. 10. CPAs can work for large, multinational firms, or for small, local firms. 11. 12. Auditors provide reasonable assurance that financial statements are fairly presented in accordance with U.S. GAAP. The Financial Accounting Standards Board is a governmental agency