ACCA Audit and Assurance (AA) 2026 past questions and answers

1. Obtain reasonable assurance that the financial statements as a whole are free from material misstatement, and express an opinion
2. Guarantee that every fraud and error, regardless of size, will be detected
3. Prepare the financial statements and decide which accounting policies management should adopt
4. Certify that the company will remain profitable and solvent in the next financial year

Answer: A. Obtain reasonable assurance that the financial statements as a whole are free from material misstatement, and express an opinion

The auditor obtains reasonable, not absolute, assurance and reports an opinion on whether the financial statements are prepared in accordance with the applicable framework. Detecting every immaterial error or guaranteeing future performance is not the audit objective.

1. Accept the trip because the audit team has not yet issued its opinion
2. Decline the trip because accepting it creates an unacceptable threat to objectivity
3. Accept the trip if the finance director confirms that it is customary business hospitality
4. Ask a different partner to sign the report while retaining responsibility for the audit

Answer: B. Decline the trip because accepting it creates an unacceptable threat to objectivity

Valuable hospitality from an audit client creates a self-interest or intimidation risk and may be perceived as impairing objectivity, so it should be declined. Changing the report signatory does not remove the threat to the partner's independence.

1. The external auditor is responsible for preparing the statements because the auditor signs the report
2. The audit committee is responsible for preparing the statements whenever the company has one
3. Management is responsible for preparing the statements and maintaining the controls needed to do so
4. The external auditor and management share responsibility equally once an engagement letter is signed

Answer: C. Management is responsible for preparing the statements and maintaining the controls needed to do so

Management is responsible for the preparation and fair presentation of the financial statements and for relevant internal control. The auditor independently evaluates and reports on them rather than assuming management's responsibilities.

1. The internal audit manager reports only to the finance director whose processes are routinely reviewed
2. The internal audit manager reports to the sales director and obtains approval for each finding
3. The internal audit manager reports to the external audit engagement partner
4. The internal audit manager has direct access to, and reports functionally to, the audit committee

Answer: D. The internal audit manager has direct access to, and reports functionally to, the audit committee

Functional reporting to the audit committee helps the internal audit function communicate findings without undue influence from managers whose activities it reviews. The external auditor may consider internal audit work but does not manage the client's function.

1. Overseeing the integrity of financial reporting and monitoring the external audit relationship
2. Preparing management's estimates and approving every journal entry before posting
3. Guaranteeing that the external auditor will discover all instances of fraud
4. Taking over the board's responsibility for the company's internal controls

Answer: A. Overseeing the integrity of financial reporting and monitoring the external audit relationship

An audit committee typically oversees financial reporting, internal control, and the external audit process on behalf of the board. It does not prepare the accounts or replace the board's and management's responsibilities.