Compliance Audit MCQs 2026

Which statement about Compliance vs substantive audit is correct

1. A identical always ✓
2. B compliance never used in audit ✓
3. C substantive only for NGOs ✓
4. D compliance tests adherence substantive tests monetary misstatement ✓

In Compliance Audit, Negative compliance finding primarily means

1. A reporting instances of non-compliance with criteria ✓
2. B hide all violations ✓
3. C only report compliance never exceptions ✓
4. D modify FS opinion always for minor compliance ✓

A key aspect of Agreed criteria in compliance audit is that it involves

1. A criteria invented after fieldwork secretly ✓
2. B criteria identified in engagement letter before work begins ✓
3. C auditor sets any criteria unilaterally without user ✓
4. D no written terms needed ✓

Anti-money laundering compliance in the context of Compliance Audit refers to

1. A only manufacturing firms always ✓
2. B never applies in Pakistan ✓
3. C only audit fixed assets ✓
4. D financial institutions audit KYC and suspicious transaction reporting ✓

Which statement about Data protection compliance is correct

1. A never relevant to audit ✓
2. B only EU companies ✓
3. C emerging area reviewing personal data handling practices ✓
4. D ignore all digital records ✓

A key aspect of Regulatory compliance audit is that it involves

1. A only ISO culinary standards ✓
2. B only sports league rules unless engaged ✓
3. C never banking prudential ✓
4. D focus on sector regulator requirements such as SECP or SBP ✓

Compliance Audit: Environmental compliance audit can be defined as

1. A assessing adherence to environmental laws and permits ✓
2. B only financial ratios ✓
3. C only employee dress code unless EHS engaged ✓
4. D never Pakistan EPA rules ✓

Regarding Labor law compliance audit in Compliance Audit, the accurate view is

1. A checking wages hours safety and social security compliance ✓
2. B only audit inventory obsolescence ✓
3. C only marketing compliance ✓
4. D ignore factory acts ✓

A key aspect of Internal control compliance is that it involves

1. A only read mission statement ✓
2. B only interview receptionist once ✓
3. C testing whether controls operated as designed throughout period ✓
4. D never test authorization ✓

A key aspect of Compliance audit sampling is that it involves

1. A sample transactions to test compliance rate with policy ✓
2. B always 100 percent of all laws globally ✓
3. C never sample in compliance ✓
4. D only judgment never documentation ✓

Compliance Audit: Follow-up compliance audit can be defined as

1. A re-testing prior period non-compliance areas ✓
2. B never revisit ✓
3. C only audit new products ✓
4. D ignore repeat violations ✓

Regarding Compliance risk assessment in Compliance Audit, the accurate view is

1. A assume no laws apply ✓
2. B identifying laws and regulations applicable to entity operations ✓
3. C only one generic law worldwide ✓
4. D ignore industry specific rules ✓

Whistleblower compliance in the context of Compliance Audit refers to

1. A prohibit all whistleblowing ✓
2. B evaluating whether entity policy meets legal and governance expectations ✓
3. C no policy needed ever ✓
4. D only external auditor handles all tips ✓

In Compliance Audit, Compliance audit primarily means

1. A only expresses opinion on profit trend ✓
2. B only product taste testing ✓
3. C obtaining evidence about whether activities comply with criteria ✓
4. D only office decoration standards ✓

Compliance Audit: Compliance audit report can be defined as

1. A always same as audit opinion on FS ✓
2. B never negative finding possible ✓
3. C positive or negative conclusion on compliance with specified criteria ✓
4. D only oral never written ✓

Which statement about Tax compliance review is correct

1. A same as transfer pricing study always ✓
2. B only Zakat never income tax ✓
3. C never review withholding ✓
4. D evaluating whether entity met tax filing and payment obligations ✓

Which statement about Contract compliance audit is correct

1. A only audit CEO speech ✓
2. B ignore milestone deliverables ✓
3. C only audit stationery ✓
4. D verifying performance against donor or government contract terms ✓

Regarding Compliance audit in NGOs in Compliance Audit, the accurate view is

1. A NGOs exempt from all compliance ✓
2. B donor requirements for fund utilization and reporting ✓
3. C only profit motive entities ✓
4. D never audited for grants ✓

SECP compliance certificate in the context of Compliance Audit refers to

1. A auditor signs compliance certificate always ✓
2. B never required for listed companies ✓
3. C company secretary or CEO certifies compliance with corporate governance code ✓
4. D only for sole proprietors ✓

In Compliance Audit, Compliance criteria primarily means

1. A auditor personal preferences ✓
2. B laws regulations policies or contract terms used as benchmark ✓
3. C competitor secret strategy ✓
4. D random internet advice ✓