Practice Quiz

RTRP - IRS Registered Tax Return Preparer Test - Question List

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26. What does an auditor look for?
  1. Reasonable assurance about the financial information being true and fair
  2. Absolute assurance about authenticity of financial statements
  3. Relative assurance
  4. None of these
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27. What does a ‘qualified audit opinion’ refer to?
  1. Auditor is 100% sure about the authenticity of the financial statements
  2. Financial statements are not prepared as per the required financial standards
  3. Auditor will give the opinion later
  4. One or more areas of the financial statements do not adhere to auditing standards
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28. If an underpayment of tax liability is established, then the fine imposed is based on:
  1. The amount of tax left unpaid
  2. The entire tax liability is considered for such purposes
  3. The underpayment of tax
  4. One-fourth of the amount underpaid
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29. Tax fraud cases are difficult to unearth because:
  1. It involves money
  2. It takes much time to settle the case
  3. It is difficult to prove and establish the essence of tax evasion and fraud
  4. Court is too busy with other criminal cases
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30. The difference between tax avoidance and tax evasion is:
  1. Tax avoidance is permissible by law, whereas, tax evasion is a crime
  2. Tax avoidance is punishable, whereas, tax evasion is allowed
  3. Tax avoidance is manipulation of laws, whereas, tax evasion is lawful
  4. Tax avoidance at a larger level refers to tax evasion
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