RSM US in India Audit Associate Interview Questions and Answers

Risk of material misstatement procedure is a process to identify and assess the risk of errors or fraud in financial statements.

• The procedure involves understanding the entity and its environment, including internal controls.

• It also includes assessing the risks of material misstatement due to fraud or error.

• The auditor then designs and performs audit procedures to address the identified risks.

• Examples of procedures inc...read more

Audit of specified accounts involves examining specific financial accounts to ensure accuracy and compliance.

• Identify the specified accounts to be audited based on risk assessment

• Review transactions and balances related to the specified accounts

• Perform substantive testing to verify the accuracy of the accounts

• Document findings and communicate any discrepancies to management

• Ensure compliance with relevant accounting sta

Current assets are assets that are expected to be converted into cash or used up within one year, while financial assets are assets that are traded in financial markets.

• Current assets include cash, accounts receivable, inventory, and prepaid expenses

• Financial assets include stocks, bonds, derivatives, and other securities

• Current assets are used in day-to-day operations of a business, while financial assets are typicall

Materiality is determined by considering the impact of an error on financial statements and users' decision-making.

• Consider the size and nature of the item in relation to the financial statements

• Assess the potential impact on users' decision-making

• Take into account regulatory requirements and industry standards

• Use professional judgment to determine materiality thresholds

• Materiality can vary based on the specific circum

Audit of Fixed Assets involves verifying existence, ownership, valuation, and physical condition of assets.

• Reviewing the fixed assets register to ensure all assets are recorded accurately

• Physically inspecting the assets to verify their existence and condition

• Checking ownership documents to confirm legal ownership of the assets

• Evaluating the valuation method used for fixed assets to ensure it complies with accounting st...read more

Optimisation involves finding the best solution to a problem by maximizing or minimizing a certain objective function.

• Identify the objective function to be optimized

• Define constraints that need to be satisfied

• Choose an optimization algorithm such as gradient descent or genetic algorithms

• Iteratively improve the solution until the optimal solution is found