This document includes a series of multiple-choice ...

1 This document includes a series of multiple- choice questions (MCQs) that were previously used on The Uniform CPA Examination . These MCQs represent a one- time release of Exam content to the general public intended to provide examples of the types of MCQs used on the Exam. This document will be accessible from October 1, 2019 through December 31, 2019. These MCQs will not be updated to reflect the impact of any standard-setting or regulatory activity (changes) that occurs after October 1, 2019, which could make them obsolete or technically incorrect. It is your sole responsibility to be aware of changes that may impact these questions and answers.

2 The AICPA undertakes no responsibility to update these questions and answers. The document includes : 40 MCQs from the Auditing and Attestation (AUD) Section Pages 1-41. 25 MCQs from the Business Environment and Concepts (BEC) Section Pages 42-67. 50 MCQs from the Financial Accounting and Reporting (FAR) Section Pages 68-118. 25 MCQs from the Regulation (REG) Section Pages 119-144. Each MCQ includes the following attributes: Question Answer choices Item ID ( unique question identifier). Key is the correct answer Content coding to the Blueprints effective July 1, 2019.

3 O coding schema = ABC = Exam section (AUD, BEC, FAR, or REG). 00X = Blueprint Area (001,002,003,004,005 that corresponds to I,II,III,IV, V in the Blueprints). 0YY = Group within the Blueprint Area (001 through 012 that corresponds to A through L in the Blueprint). 0ZZ = Topic within the Blueprint Group (001 through 010 that corresponds to 1 through 10 in the Blueprints). Skill coding to the Blueprints (Remembering and Understanding or Application). AUD. 1. 111. 1. Which of the following statements is correct concerning both an engagement to compile and an engagement to review a nonissuer's financial statements?

4 Accountant expresses no assurance on the financial statements. accountant should obtain a written management representation letter. accountant need not obtain an understanding of internal control. accountant must be independent in fact and appearance. Item ID: 24409. Key: C. : : Remembering and Understanding:1. 2. 111. 2. A compilation of financial statements in accordance with Statements on Standards for Accounting and Review Services is limited to presenting data that conforms with a special purpose framework other than GAAP. financial statements that omit substantially all required GAAP disclosures.

5 In the form of financial statements that is the representation of management. financial information that has been subjected to inquiry and analytical procedures. Item ID: 8937. Key: C. : : Remembering and Understanding:1. 3. 33. 3. 3333. 333334 33 3333. 332333grtygrt3. 3. According to rules issued under the Sarbanes-Oxley Act, which of the following nonaudit services is an accounting firm permitted to provide for an issuer audit client without impairing the accounting firm's independence? an expert opinion in order to advocate the client's interest in litigation.

6 An expert opinion in order to advocate the client's position in a regulatory investigation. factual accounts in testimony explaining positions taken during the performance of any services provided to the client. legal services to the client in a foreign jurisdiction. Item ID: 10799. Key: C. : : Application:2. 4. 4. Before accepting an audit engagement, a CPA should evaluate whether conditions exist that raise questions as to the integrity of management. Which of the following conditions most likely would raise such questions? are significant differences between the entity's forecasted financial statements and the financial statements to be audited.

7 CPA will not be permitted to have access to sensitive information regarding the salaries of senior management. have been substantial inventory write-offs just before the year end in each of the past four years. CPA becomes aware of the existence of related party transactions while reading the draft financial statements. Item ID: 9699. Key: B. : : Application:2. 5. 5. Which of the following factors most likely would cause a CPA not to accept a new audit engagement? reputation for failing to provide schedules to prior auditors on a timely basis. CPA's inability to review the predecessor auditor's working papers.

8 's unwillingness to make all financial records available to the CPA. CPA's lack of understanding of the entity's operations and industry. Item ID: 10227. Key: C. : : Remembering and Understanding:1. 6. 6. Which of the following factors most likely would cause an accountant not to accept an engagement to compile the financial statements of a nonissuer? lack of segregation of duties in the entity's accounting and payroll departments. that reports of asset misappropriation are not investigated by management. entity's intention to omit from the financial statements substantially all of the disclosures required by GAAP.

9 's acknowledgement that the financial statements will be included in a written personal financial plan. Item ID: 24423. Key: B. : : Application:2. 7. 7. Which of the following statements would most likely appear in an auditor's engagement letter? is responsible for reporting to us any inadequate provisions for the safeguarding of assets. will identify internal controls relevant to specific assertions that may prevent or detect material misstatements. agrees to correct all deficiencies in internal control activities identified by us. is responsible for making all financial records and related information available to us.

10 Item ID: 10137. Key: D. : : Remembering and Understanding:1. 8. 8. Which of the following activities is not an element of a CPA firm's quality control system to be considered in establishing quality control policies and procedures? whether to accept or continue a client relationship. personnel for advancement who have the necessary qualifications. a client's ability to establish effective internal controls. the effectiveness of professional development activities. Item ID: 10415. Key: C. : : Remembering and Understanding:1. 9. 9. The purpose of establishing quality control policies and procedures for deciding whether to accept or continue a client relationship is to reasonable assurance that personnel are adequately trained to fulfill their responsibilities.