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NEW QUESTION: 1
Which of the following procedures would an auditor ordinarily perform first in evaluating management's
accounting estimates for reasonableness?
A. Consider the appropriateness of the key factors or assumptions used in preparing the estimates.
B. Obtain an understanding of how management developed its estimates.
C. Develop independent expectations of management's estimates.
D. Test the calculations used by management in developing the estimates.
Answer: B
Explanation:
Explanation/Reference:
Explanation:
Choice "D" is correct. In evaluating the reasonableness of an accounting estimate, the auditor should first
obtain an understanding of how management developed its estimate.
Choice "A" is incorrect. After first obtaining an understanding of how management developed its estimate,
the auditor should use one or a combination of the following approaches: a) review and test the process
used by management to develop the estimate, b) develop an independent expectation of the estimate to
corroborate the reasonableness of management's estimate, or c) review subsequent events.
Choice "B" is incorrect. After having first obtained an understanding of how management developed its
estimate, the auditor should consider testing management's process by assessing the appropriateness of
the key factors or assumptions used in preparing the estimate.
Choice "C" is incorrect. After first obtaining an understanding of how management developed its estimate,
the auditor should use one or a combination of the following approaches: a) review and test the process
used by management to develop the estimate, b) develop an independent expectation of the estimate to
corroborate the reasonableness of management's estimate, or c) review subsequent events.

NEW QUESTION: 2
Refer to the shown below. %PIX|ASA-3-105010: (Primary) Failover message block alloc failed * %PIX|ASA-3-106010: Deny inbound protocol src interface_name:dest_address/dest_port dst
interface_name:source_address/source_port * %PIX|ASA-3-106011: Deny inbound (No xlate) string * %PIX|ASA-3-106014: Deny inbound icmp src interface_name: IP_address dst interface_name:
IP_address (type dec, code dec) * %PIX-3-107003: RIP: Attempted reference of stale data encountered in function, line: line_num * %PIX|ASA-3-109010: Auth from inside_address/inside_port to outside_address/outside_port failed (too
many pending auths) on interface interface_name. * %PIX|ASA-3-109013: User must authenticate before using this service * %PIX|ASA-3-109016: Can't find authorization ACL acl_ID for user 'user' * %PIX|ASA-3-109018: Downloaded ACL acl_ID is empty * %PIX|ASA-3-109019: Downloaded ACL acl_ID has parsing error; ACE string * %PIX|ASA-3-109020: Downloaded ACL has config error; ACE * %PIX|ASA-3-109023: User from source_address/source_port to dest_address/dest_port on interface
outside_interface must authenticate before using this service. What statement is correct regarding the output shown in the graphic?
A. The first log message is categorized as a warning message.
B. These two log messages will not have a severity level. They are not errors but are just informational messages.
C. The second message would be shown if the logging console warning command had been issued.
D. These messages regarding interface status are normal output and will always be displayed when you exit config mode.
E. The first log message is an error message with a severity level of 3.
Answer: E

NEW QUESTION: 3
Which of the following statements are true:
I. Liquidity risks during time of crisis may be exacerbated by large collateral calls continuing over a period of time.
II. Stress tests are always separately modeled from VaR computations which cannot deal with stress scenarios of the kind considered in stress tests.
III. A maximum loss scenario considers the maximum possible loss given a 'plausibility constraint' that is based upon the joint probability of such a loss happening
A. I, II and III
B. II and III
C. I and III
D. I and II
Answer: C
Explanation:
Explanation
If VaR is calculated based upon historical simulations, and these simulations are designed as to include all stress scenarios of interest, then VaR and stress tests can be a part of an integrated risk measurement system.
Therefore it is not correct to say that stress tests are always separately modeled from VaR and II is false. I and III are true, and therefore Choice 'd' is the correct answer.

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