CPA AUD Audit Reports Practice Questions
Audit Reports makes up 4 of every 50 questions on a Tigertest CPA AUD practice test. Here are 10 of the 16 questions on it, each with the answer and the reason.
Updated by the Tigertest team. Based on the AICPA's 2026 AUD blueprint. Original multiple-choice questions; simulations not included. Not affiliated with the AICPA, NASBA or the PCAOB.
1. In an auditor's report on a nonissuer under AU-C 700, which section comes first?
- A.Key Audit Matters
- B.Opinion
- C.Basis for Opinion
- D.Responsibilities of Management
Answer: B. Since SAS 134, the Opinion section comes first, followed directly by the Basis for Opinion section.
2. The Basis for Opinion section of an unmodified report for a nonissuer states that the auditor is:
- A.Paid a fixed fee in advance
- B.Registered with the SEC
- C.Liable for any fraud found
- D.Independent of the entity
Answer: D. It states that the audit followed GAAS, that the auditor is independent and has met other ethical responsibilities, and that the evidence is sufficient and appropriate.
3. The auditor's report should be dated no earlier than the date on which the auditor has:
- A.Sufficient appropriate evidence
- B.Released the report to the client
- C.Sent the final invoice
- D.Signed the engagement letter
Answer: A. Evidence includes that all the statements, including disclosures, were prepared and management has asserted responsibility for them.
4. Statements contain a material misstatement that is not pervasive. The auditor issues:
- A.A disclaimer of opinion
- B.An unmodified opinion
- C.A qualified opinion
- D.An adverse opinion
Answer: C. A material but not pervasive misstatement leads to a qualified opinion. If the misstatement were pervasive, the opinion would be adverse.
5. Statements are materially and pervasively misstated because consolidation was not done. The auditor issues:
- A.A disclaimer of opinion
- B.An unmodified opinion
- C.An adverse opinion
- D.A qualified opinion
Answer: C. When misstatements are both material and pervasive, the auditor expresses an adverse opinion that the statements are not fairly presented.
6. The auditor cannot obtain sufficient appropriate evidence, and the possible effects are material and pervasive. The auditor issues:
- A.A disclaimer of opinion
- B.A qualified opinion
- C.An unmodified opinion
- D.An adverse opinion
Answer: A. An inability to obtain evidence whose possible effects are material and pervasive leads to a disclaimer. If material but not pervasive, the opinion is qualified.
7. An emphasis-of-matter paragraph in a nonissuer report refers to a matter that is:
- A.Outside the statements entirely
- B.Materially misstated in the statements
- C.Not yet audited by the auditor
- D.Appropriately presented or disclosed
Answer: D. It draws attention to a matter properly presented or disclosed that is fundamental to users' understanding, such as a major catastrophe. It does not modify the opinion.
8. An other-matter paragraph in an auditor's report refers to a matter that is:
- A.A change in accounting principle
- B.Not presented in the statements
- C.A material misstatement found
- D.A lawsuit disclosed in the notes
Answer: B. It covers matters other than those presented or disclosed that are relevant to users' understanding of the audit, the auditor's responsibilities or the report.
9. A nonissuer changes its inventory method from FIFO to weighted average, accounts for it properly, and discloses it. The auditor's report includes:
- A.No reference to the change
- B.An emphasis-of-matter paragraph
- C.A qualified opinion for the change
- D.An other-matter paragraph
Answer: B. A justified change in accounting principle with a material effect is highlighted in an emphasis-of-matter paragraph, and the opinion is unmodified.
10. Under PCAOB AS 3101, a critical audit matter is one communicated to the audit committee that relates to material accounts or disclosures and:
- A.Was corrected by management before issue
- B.Involved a related party transaction
- C.Was first found by internal audit
- D.Involved especially challenging judgment
Answer: D. A CAM arises from the audit, was communicated or required to be communicated to the audit committee, relates to material accounts or disclosures and involved especially challenging, subjective or complex auditor judgment.
Practice all 16 audit reports questions, and the rest of the 200-question bank, in the free CPA AUD training sets. Questions you miss come back until you have mastered them.
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