Internal audit is conducted by: MCQ with Answer and Explanation

Internal audit is conducted by:
A. Employees of the company
B. Statutory auditor
C. External auditor
D. Government auditor
Answer: Option A
Solution (By JKSSB Mock Tests)
Internal audit is an independent appraisal function within the organization, performed by internal staff or outsourced, but it's internal to the management.

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Practice More Accountancy and Book Keeping Questions

Question #1
S1: AS 1 mandates the disclosure of all accounting policies used. S2: AS 3 deals with the preparation of cash flow statements. Which statement(s) is/are correct?
A. S2 only
B. Both S1 and S2
C. Neither S1 nor S2
D. S1 only

Correct Answer: Option B


Explanation:
AS 1 requires the disclosure of significant accounting policies. AS 3 mandates the preparation and presentation of cash flow statements. Both statements are correct.

Question #2
The 'Non-Controlling Interest' (NCI) at acquisition date can be measured at:
A. Book value
B. Only fair value
C. Either fair value or proportionate share of net assets
D. Only proportionate share of net assets

Correct Answer: Option C


Explanation:
Ind AS 103 allows a choice.

Question #3
If a factory uses standard costing, the Material Price Variance is calculated as:
A. (Standard Price - Actual Price) * Actual Quantity
B. (Standard Price - Actual Price) * Standard Quantity
C. Standard Cost - Actual Cost
D. (Standard Quantity - Actual Quantity) * Standard Price

Correct Answer: Option A


Explanation:
Material Price Variance isolates the price effect by multiplying the difference in price (Standard - Actual) by the Actual Quantity purchased.