Welcome to your International Navodaya Chamber of Commerce (INCOC) Platform ! Subject: Corporate Accounting and Auditing Total Number of Question: 40 Time: 41 Minutes Please check your email after completion of test for result. All the best... Name Phone No Email Area Pin Code 1. Which of the following is prepared at the end of a company's life? Profit and Loss Account Liquidator’s Final Statement of Account Trial Balance Balance Sheet None 2. Which accounting standard deals with depreciation accounting? AS 2 AS 6 AS 9 AS 10 None 3. The maximum period for redemption of preference shares as per the Companies Act, 2013 is: 10 years 20 years 30 years 40 years None 4. Under which method of depreciation does the asset value never become zero? Straight-line method Written-down value method Sum of years’ digits method None of the above None 5. Goodwill is shown in the balance sheet under: Fixed assets Current liabilities Non-current assets Current assets None 6. The share application money pending allotment is shown under which head in the balance sheet? Share capital Reserves and surplus Current liabilities Non-current liabilities None 7. Preliminary expenses are shown in the balance sheet under: Current liabilities Non-current assets Miscellaneous expenditure Reserves and surplus None 8. If a company issues shares at a discount, the discount amount is debited to: Profit and Loss Account Discount on Issue of Shares Account Capital Reserve Account Securities Premium Account None 9. Which financial statement provides information about cash receipts and paymen Balance Sheet Profit and Loss Account Cash Flow Statement Statement of Changes in Equity None 10. Pre-acquisition profits of a subsidiary company are shown in the consolidated balance sheet as: Revenue profit Capital reserve Goodwill None of the above None 11. Which of the following is an example of an intangible asset? Land Trademark Inventory Accounts receivable None 12. Which of the following is not a method of valuation of goodwill? Average profit method Net asset method Super profit method Capitalization method None 13. Which type of preference shares can be converted into equity shares? Cumulative preference shares Redeemable preference shares Convertible preference shares Participating preference shares None 14. A contingent liability is recorded in the: Profit and Loss Account Balance Sheet Notes to Accounts Reserves and Surplus None 15. The primary purpose of financial statements is to: Determine tax liability Provide financial information to stakeholders Distribute dividends Comply with legal requirements None 16. Which of the following is the primary objective of auditing? Detection of frauds Prevention of frauds Examination of financial statements Verification of business efficiency None 17. Who is responsible for the appointment of a statutory auditor in a government company? Board of Directors CAG (Comptroller and Auditor General) Shareholders SEBI None 18. Which type of audit is conducted to assess operational efficiency? Statutory Audit Performance Audit Tax Audit Internal Audit None 19. Internal audit is conducted by: External auditor Company’s own staff Government officials Tax authorities None 20. An auditor should report fraud to: The management The shareholders SEBI The government None 21. Which of the following is a type of audit opinion? Clean opinion Negative opinion Financial opinion Budgetary opinion None 22. The person responsible for ensuring compliance with statutory audit requirements is: CFO Auditor Accountant Board of Directors None 23. Which of the following is an example of audit evidence? Audit report Internal memo Bank statement Financial forecast None 24. Which type of audit is conducted by a company’s own employees? External audit Statutory audit Internal audit Government audit None 25. What is the purpose of vouching? To verify financial transactions To review financial reports To audit internal controls To prepare trial balance None 26. Which type of audit is required for listed companies in India? Statutory audit Tax audit Cost audit Internal audit None 27. A qualified audit report means: The auditor found no issues The auditor has reservations about financial statements The auditor refuses to audit The company is free from liabilities None 28. What is the first step in the audit process? Report writing Planning Evidence collection Financial statement review None 29. Which of the following is not a component of audit risk? Inherent risk Control risk Detection risk Compliance risk None 30. As per SA 240, the primary responsibility for preventing fraud in an organization lies with: Auditor Management and Those Charged with Governance Shareholders Government None 31. Which of the following is an example of inherent risk? Weak internal controls Misstatement in financial statements due to error Non-compliance with statutory requirements Inefficiency in operations None 32. Audit working papers should be retained for a period of at least: 2 years 5 years 7 years 10 years None 33. Who issues the Accounting Standards in India? Reserve Bank of India (RBI) Securities and Exchange Board of India (SEBI) The Institute of Chartered Accountants of India (ICAI) Ministry of Corporate Affairs (MCA) None 34. Which of the following is a key principle of Corporate Governance? Insider trading Transparency and accountability Monopoly power Avoiding audits None 35. The term ‘window dressing’ in auditing refers to: Enhancing the physical appearance of offices Manipulating financial statements to show a better position Hiding inventory in warehouses Verifying cash transactions None 36. The term "substantive procedures" in auditing refers to: Compliance testing Tests conducted to detect material misstatements Routine checking of vouchers Appointment of auditors None 37. The key objective of an audit of internal control is to: Detect fraud Ensure statutory compliance Assess operational efficiency Evaluate the reliability of financial reporting None 38. Which of the following is an example of a detective control in an organization? Segregation of duties Regular internal audit Authorization of transactions Physical access restrictions None 39. As per Companies Act, 2013, the tenure of an individual auditor for listed companies is: 2 years 5 years 7 years 10 years None 40. Which auditing standard deals with the auditor’s responsibility related to fraud SA 500 SA 315 SA 240 SA 700 None 1 out of 4 Great job on taking the INCOC Test! We appreciate your interest in test. Look out for results and future opportunities. Stay Connected !! Your quiz time is about to finish. 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