Employee Integrity and motivation should be considered when a process has to be changed. Although implementing additional controls comes at a cost to the organization, the benefit almost always outweighs the cost. In this case, the obvious remedies are either someone needs to be responsible for auditing payroll records on a re
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Should an auditor use the same audit procedures every year?
1. If auditing background checks is part of the client agreement, how much credence would you give to a black mark that appears next to an existing employee's name? Would your decision change if the employee was performing at or better than company expectations? Would you make a note in the Audit Report? 2. What if while prop
1.We have identified many different control measures the company could have put in place to prevent fraud, but what about changing the culture of the work environment as a possible deterrent? If an employer can establish a people-first attitude, one in which its employees feel as if they are part of the family, it is less likel
Design tests of controls, substantive tests of transactions, and analytical procedures for the following Apollo Shoes cycles: o Payroll and Personnel Cycle o Acquisition and Payment Cycle 150 words each.
Case 5.3 The North Face, Inc. (by Michael C. Knaap 8e.) Questions 1. Should auditors insist that their clients accept all proposed audit adjustments, even those that have an immaterial effect on the given financial statements? Defend your answer. 2. Should auditors take explicit measures to prevent their clients from discove
CASE 5.1 CARDILLO TRAVEL SYSTEMS, INC. (By Michael C. Knapp 8e) 2. Describe the procedures an auditor should perform during a review of a client's quarterly financial statements. In your opinion, did the Touche Ross auditors who discovered the $203,000 adjusting entry during their 1985 second quarter review take all appropria
This is the first year that you have audited Hurst & Johnson Corporation. You discovered that the company is carrying its property, plant, and equipment at appraisal values and determines depreciation on the basis of these values. This is considered a very large scope-limitation, and you have not been able to form an opinion on
1. Setting clear objectives up front can make the difference between providing the client with a tool to improve operations and providing a report that adds no value other than to give the company assurance that it has a certified audit on record. What process would you follow if, during an audit, you stumble upon something
What are the advantages a firm gains by using auditing and assurance services? How might you use these advantages to promote the auditing and assurance division within a company? Compare the relationship between the auditor, client, and external users. How do professional standards for CPAs govern these relationships?
The following questions might be addressed in an evaluation of internal controls for fixed assets. For each question: a. Indicate the purpose of the control. b. Indicate the impact on the substantive audit procedures if the answer to the question indicates weak controls. Internal Control Questions 1. Does the client period
http://dailycaller.com/2012/10/02/sources-documents-suggest-government-subsidized-abound-solar-was-selling-faulty-product/. Above is a link to an article released today about my previous employer that went bankrupt in June and 375 lost their jobs in total. $300MM in private investment and $70 in public funds were lost as we
1. Which of the following statements is most correct regarding errors and fraud? An error is unintentional, whereas fraud is intentional. Fraud occurs more often than errors in financial statements. Errors are always fraud and fraud is always errors. Auditors have more responsibility for finding
Question 1: The external auditor can rely on the work of the internal auditor subject to certain conditions being met. One of this relates to the internal auditor reporting to the audit committee rather than to management. Required: (i) Please explain as to why this is an important condition to be met (ii) Provide three b
1. Who is responsible for establishing auditing standards for audits of public companies? Who is responsible for establishing auditing standards for private companies? Explain. 2. Generally accepted auditing standards have been criticized by different sources for failing to provide useful guidelines for conducting an audit. T
1. Management may delay recording of liabilities to improve the current ratio. However, financial statements that fail to report all liabilities at year-end are misstated. In assessing inherent risk for expenditure cycle assertions, the auditor should consider pervasive factors, such as pressures, to understate payables in ord
1) Why do auditors find it necessary to use sampling? What are the risks associated with sampling? How might these risks affect the audit conclusion? 2) What are some of the different types of sampling methods available to the auditor? How does the auditor decide which method to use? How might the different methods affect the
1. Materiality underlies the application of Generally Accepted Auditing Standards (GAAS), particularly the: a. general and field work standards, b.general and reporting standards, c. field work and reporting standards, d.reporting standards, or e.general standards. 2.Which of the following is not a weakness of analyt
1) The following is a common example of a circumstance imposed scope limitation. An auditor might identify a material weakness at an interim date, and the entity implements new controls to correct the deficiency. If the new controls are placed in operation near year-end, the auditor may not have sufficient time to determine that
1) Analytical procedures can assist the auditor in planning by (1) enhancing the auditor's understanding of the client's business, and (2) identifying areas of greater risk of misstatement. The effective use of analytical procedures in the planning phase involves the systematic completion of the following steps: 1. Identif
- Describe the elements of the Generally Accepted Auditing Standards (GAAS). - Describe how these standards apply to financial, operational, and compliance audits. - Explain the effect that the Sarbanes-Oxley Act of 2002, and the Public Company Accounting Oversight Board (PCAOB), will have on audits of publicly traded compani
1) Why is public accounting often viewed as a guarantor of results, or even as a provider of assurance that one's investment is of high quality? To what extent is it reasonable to view the auditor as a guarantor? Explain. To what extent do you believe that user expectations of the public accounting profession appear to be unwarr
For each of the following statements, indicate whether it is more closely related to attribute sampling or variables sampling by using the letter A (attribute) and V (variables) ___ 1. The population size affects the sample size (Variable or Attribute) ___ 2. Sampling risks include the risk of incorrect acceptance and risk o
What do you see as the primary cause of the auditing problems that led to the Enron scandal? Who do you believe carries the moral responsibility for those failures? Why?
Please help answer the following multiple choice questions: 1. In determining the primary responsibility of the external auditor for a company's financial statements, the auditor owes primary allegiance to: a. The management of the company being audited because the auditor is hired and paid by management. b. The audit commi
What are the Objectives of internal auditing? Is Scope of Internal auditing limited to accounting only?
The Code of Professional Conduct is very important for the auditing profession. The AICPA, State Boards, and other professional organizations spend a great deal of time and effort implementing, and reinforcing the ethical standards, and penalizing those who violate the ethical standards. I need help with answering the follo
1. Why do auditors find it necessary to use sampling? What are the risks associated with sampling? How might these risks affect the audit conclusion? 2. What is the importance of defining the population when performing audit procedures? How would defining the population affect the sample size? How would incorrectly defining t
Prepare a 1,050- to 1,400-word paper in which you compare and contrast auditing, attestation, and assurance services. In your paper, address the following: - An example of each type of service - Who might request such a service? - What standards apply to each service and who establishes those standards? Format your paper
Create an argument to the Kodak shareholders that, despite the long relationship between Kodak and PricewaterhouseCoopers, the public accounting firm maintains its professional independence.