CA IntermediateAuditing & Ethics2025

CA Intermediate - Auditing & Ethics (2025)

Download and solve CA Intermediate Auditing & Ethics question paper for 2025. Free English medium easy difficulty paper with model answers and explanations on Plainscan.

Question Paper

Question 1

singlePrimary Objective of Audit
2 Marks
The primary objective of an audit of financial statements is to:
A.Detect all frauds and errors in the accounts
B.Express an opinion on the true and fair view of the financial statements
C.Certify the accuracy of every transaction
D.Prepare the financial statements

Question 2

singleMateriality
2 Marks
The concept of 'Materiality' in auditing is related to:
A.The cost of audit procedures
B.Information whose omission or misstatement could influence the economic decisions of users of the financial statements
C.The total size of the balance sheet
D.The number of years of audit experience

Question 3

singleModified Opinion - Adverse Opinion
2 Marks
An auditor's report that contains a modified opinion due to pervasive misstatement is called a:
A.Qualified Opinion
B.Emphasis of Matter paragraph
C.Adverse Opinion
D.Disclaimer of Opinion

Question 4

singleVouching
2 Marks
The 'Vouching' technique in auditing is primarily concerned with:
A.Confirming physical existence of assets
B.Verifying documentary evidence supporting accounting entries
C.Computing account balances
D.Testing analytical relationships

Question 5

singleAuditor Appointment Term
2 Marks
Under the Companies Act, 2013, the term of an auditor appointed by an Annual General Meeting of a public company is:
A.1 year
B.2 years
C.5 consecutive years
D.Until he resigns

Question 6

singleAudit Risk Definition
2 Marks
Audit risk is defined as the risk that:
A.The client commits fraud
B.The auditor expresses an inappropriate opinion when the financial statements are materially misstated
C.Audit fees are not collected
D.The audit is completed late

Question 7

singleInherent Risk
2 Marks
Which of the following best describes 'Inherent Risk' in an audit context?
A.The risk of error arising from the absence of internal controls
B.The susceptibility of an account balance to material misstatement, assuming no internal controls exist
C.The risk that the auditor fails to detect existing misstatements
D.The risk of client business failure

Question 8

singleSA 300 - Audit Planning
2 Marks
The Standard on Auditing (SA) that deals with planning an audit of financial statements is:
A.SA 200
B.SA 300
C.SA 500
D.SA 700

Question 9

singleIndependence in Appearance
2 Marks
An auditor who is independent in fact but is known to have a personal relationship with the client's management may be lacking in independence:
A.In mind only
B.In appearance only
C.Both in mind and appearance
D.Neither; personal relationships are acceptable

Question 10

singleTest of Controls
2 Marks
Which of the following is an example of a 'Test of Controls' in auditing?
A.Tracing a sample of sales invoices to the sales ledger
B.Inspecting authorization signatures on purchase orders
C.Performing a ratio analysis on revenue
D.Confirming accounts receivable balances with customers

Question 11

singleSA 500 - Audit Evidence
2 Marks
Which Standard on Auditing provides guidance on 'Audit Evidence'?
A.SA 200
B.SA 402
C.SA 500
D.SA 620

Question 12

singleGoing Concern - SA 570
2 Marks
A Statutory Auditor discovers during the audit that there is a significant doubt about the entity's ability to continue as a going concern. He should:
A.Immediately resign from the audit engagement
B.Ignore it if management confirms no issues
C.Include an Emphasis of Matter paragraph or modify his opinion after obtaining sufficient evidence and assessing disclosure adequacy
D.Issue an unmodified report to avoid alarming stakeholders

Question 13

singleCARO
2 Marks
The term 'CARO' stands for:
A.Companies Audit and Reporting Order
B.Companies (Auditor's Report) Order
C.Comprehensive Annual Revenue Order
D.Central Accounting and Reporting Order

Question 14

singleSelf-Interest Threat
2 Marks
Under the ICAI Code of Ethics, the 'self-interest threat' to independence arises when a member has:
A.A financial interest in a client
B.Previously provided advice to a client
C.Been involved in preparing financial statements for a client
D.Reviewed the work of a colleague

Question 15

singleInternal Check
2 Marks
Internal check is best described as:
A.A special audit carried out at year end
B.A system of allocation of duties where no single person handles a transaction from beginning to end
C.Preparation of internal financial statements
D.Internal audit conducted monthly

Question 16

singleUnmodified Opinion
2 Marks
Which of the following correctly describes an 'Unmodified Opinion' (Clean Report) in an auditor's report?
A.The auditor found several material errors but they were corrected
B.The auditor could not obtain sufficient audit evidence
C.The financial statements give a true and fair view in all material respects in accordance with the applicable framework
D.The auditor disagrees with management on accounting policies

Question 17

singleFinal Analytical Procedures
2 Marks
Analytical procedures performed at the end of the audit to assess whether the financial statements are consistent with the auditor's understanding are called:
A.Preliminary analytical procedures
B.Substantive analytical procedures
C.Final analytical procedures (Overall review)
D.Risk assessment procedures

Question 18

singleCAAT - Complete Population Testing
2 Marks
An auditor who uses a computer-assisted audit technique (CAAT) to test 100% of transactions in an accounting system (rather than sampling) is performing:
A.Audit sampling
B.Stratified sampling
C.Complete population testing
D.Haphazard testing

Question 19

singleAuditor Disqualification - Section 141(3)
2 Marks
Which of the following is NOT a disqualification for appointment as auditor under Section 141(3) of the Companies Act, 2013?
A.A body corporate other than a Limited Liability Partnership (LLP)
B.A Chartered Accountant who holds securities of the company worth ₹100
C.A relative of a director of the company
D.A person who is a member of the ICAI

Question 20

singleProfessional Skepticism
2 Marks
The principle of 'Professional Skepticism' in auditing means that the auditor should:
A.Always assume management is dishonest
B.Accept all management representations without question
C.Maintain a questioning mind and critically assess audit evidence, remaining alert to possible misstatements
D.Perform only minimum required audit procedures

Paper Details

  • Difficultyeasy
  • LanguageEnglish

Mock Exam Settings

5 min25 max
CA Intermediate - Auditing & Ethics (2025) | Plainscan