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External Auditing

Auditing

25) Information risk refers to the risk that A. the client may not be able to remain in business. B. errors and frauds are not detected by the auditor's procedures. C. the client's financial statements may be materially false and misleading. D. the auditor may express an unqualified opinion on financial sta

Auditing Principles Questions

22) Which control question relates to the existence and occurrence objective in purchasing and accounts payable? A. Does the chart of accounts and accounting manual provide instructions for classifying debit entries? B. Are the purchase order forms prenumbered and is the numerical sequence checked for missing documents

Auditing

1) Rule 102, Integrity and Objectivity, applies to A. all professional services. B. all accounting and audit services. C. all attestation services. D. only audit services. 2) The fundamental issues in independence require that the auditor avoid A. financial connections with the firm and acting a

Describe 2-3 areas of auditing risk in a retail business one might feel do not have sufficient controls. Explain what risks the organization faces by allowing these items to continue in their current form. 2. Using the 2-3 risk areas identified in question #1, explain the control procedures you would recommend establishing to mitigate the risk. Go on to explain the audit process you would use to audit each of your proposed solutions.

1. Describe 2-3 areas of auditing risk in a retail business one might feel do not have sufficient controls. Explain what risks the organization faces by allowing these items to continue in their current form. 2. Using the 2-3 risk areas identified in question #1, explain the control procedures you would recommend establishin

1. Explain why sampling is important in the auditing process. Give an example of an instance where sampling would be appropriate and an example of where it would not, explain why 2. Define inherent risk and explain how this applies to transaction cycles. Give an example of how flowcharting or control matrices could help identify and mitigate inherent risks

1. Explain why sampling is important in the auditing process. Give an example of an instance where sampling would be appropriate and an example of where it would not, explain why 2. Define inherent risk and explain how this applies to transaction cycles. Give an example of how flowcharting or control matrices could help ident

Procedures, tools, and techniques

What sampling tools and techniques will be used for the examination? What analytical and inferential tools will be used to evaluate accounting evidence?

Core Concepts of Information Technology Auditing

Of the 10 steps to using CAATs outlined in Ch. 8 of Core Concepts of Information Technology Auditing, which is the most important and why? If you had to add an additional step what would it be and why?

Auditing: PCAOB Audit Trail, Software & General Controls for IT

Is it probable that the use of information technology (IT) will eventually eliminate the audit trail, making it impossible to trace individual transactions from their origin to the summary total in the financial statements? Explain. How do the American Institute of Certified Public Accountants (AICPA) and the Public Company Acco

Auditor Judgment or Instinct

I would say the use of auditor judgment or instinct is not only acceptable, but also required. The text explains this best: "GAAS and the SASs should be looked on by practitioners as minimum standards of performance rather than as maximum standards or ideals. Any professional auditor who seeks means of reducing the scope of the

Effectiveness of Internal Controls on Reliability

"The reperformance technique should be used in order to ensure the audit evidence supports the conclusions as reperformance is independent execution of procedures or controls that the auditor can verify the evidence originally generated by the client's system." Our text tells us that "both physical examination and reperformance

Timing of collecting evidence would be important

"four decisions" that auditor's must make in determining the amount and type of evidence to collect. In my opinion, the first three are probably the ones auditors focus on the most. However, I think the fourth point regarding the timing is just as critical (if not more important) in most circumstances. Timing can be influence

Auditing: Defining the Population when Sampling

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 the population affect the sampling unit? Why do auditors find it necessary to use sampling? What are the risks associated with sampling? How might these r

Understanding Your Auditing Environment - HipStar Recording Industry

You have just been assigned as in-charge accountant on HipStar, Inc. a new audit client in the recording industry. HipStar is an emerging growth company that finds new recording artists, records their music, and distributes the music directly to consumers exclusively over the Internet. The company does not produce CDs or tapes a

GAAS

explain the nature and functions of auditing. Relate your explanation to the audit functions in your organization, or an organization with which you are familiar. Address the following · Describe the elements of the Generally Accepted Auditing Standards (GAAS). · Describe how these standards apply to financial,

Article review - Cohen et al 'Is it the Kids or the Schedule?'

1. Provide a 2-3 paragraph overview of the article: Almer, Elizabeth Dreike, Cohen, Jeffrey R. and Single, Louise E., Is it the Kids or the Schedule?: The Incremental Effect of Families and Flexible Scheduling on Perceived Career Success. Journal of Business Ethics, Vol. 54, pp. 51-65, 2004. Available at SSRN: http://ssrn.com

Donald Reynolds, director of the internal auditing department, received an anonymous tip from an employee in one of the high tech manufacturing plants. The employee noted that there was a major embezzlement taking place in one of the divisions. Internal audit had completed a routine review of internal control of that division the previous year and found that the control system was properly designed and operating effectively. Only minor recommendations were made, and the next review is due 3 years later. The employee noted the erratic behavior and lavish lifestyle of the plant controller and stated that the controller has been overriding existing controls, which would prevent any audit from being able to detect the embezzlement. The plant controller is well-respected and highly trusted by the CEO and CFO, and their families are involved in the same civic and religious organizations. Investigating the plant controller could cause considerable disruption in the company and the personal lives of the employees. Please answer the following questions. As you answer each question, you must provide support or evidence that will enhance and empirically prove your answers. Academic criminal justice articles or real life criminal justice findings that are not found in journals or other academic sources must be used in supporting your answers. Please use APA style for all cited sources including your resource page. - Given the situation, discuss some of the options the company has for handling this situation. - Assuming you decide to investigate these allegations, describe the investigation steps. - In preparation for the interviews, note the order of the witnesses who would be interviewed and how you would plan, conduct, and document your interviews. - Discuss how you would conduct an admission-seeking interview of the plant controller.

Can you help me with this assignment? Details: Donald Reynolds, director of the internal auditing department, received an anonymous tip from an employee in one of the high tech manufacturing plants. The employee noted that there was a major embezzlement taking place in one of the divisions. Internal audit had completed a rou

Attest engagement: What is an assertion? Be written?

An attest engagement is one in which a practitioner is engaged to issue or does issue an examination, review, or an agreed-upon procedures report on subject matter, or an assertion about the subject matter, that is the responsibility of another party. Question: What is an assertion? Should assertions be written? Response

Audit Review Questions

24. In accepting an engagement, an auditor takes on professional responsibilities to: a. the public. b. the client. c. other members of the public accounting profession. d. the public, the client, and other members of the public accounting profession. e. the client and the public. 25. The importance of the a

Auditing Practice Questions

19. Choices about audit evidence are influenced by all of the following except: a. the auditor's understanding of the business and industry. b. decisions about inherent risk and control risk. c. comparisons of the auditor's expectations of the financial statements with the client's books and records. d. decisions about

One of the important aspects when evaluating evidence in auditing is the timing of the evidence. That is does the evidence indicate that the transactions were recorded in the proper period? This test work is often called cut off testing. In looking at this type of testing it is also important for the auditor to understand the documentary evidence that surrounds this transaction. For example if we look at sales or purchases of products at a manufacturing company one of the important aspects is looking at the terms and conditions (T&C) in which the company operates with its customers and vendors. This is critical for the auditor as it will tell him/her when title passes. These are commonly referred to as Inco terms (International Trade Terms). These terms and conditions will specify when title passes from buyer to seller. Therefore, letâ??s look at a simple sales transaction where the Inco terms are FOB shipping point. In this case the auditor would look at the Purchase Order with the customer, the invoice and the shipping document. From a cut off standpoint (due to the T&C) the auditor will determine when the product was shipped and then ensure that the sale is recorded in the proper period. Why would this be important? Can you think of a reason that the auditor would perform these types of tests? What about for purchases?

One of the important aspects when evaluating evidence in auditing is the timing of the evidence. That is does the evidence indicate that the transactions were recorded in the proper period? This test work is often called cut off testing. In looking at this type of testing it is also important for the auditor to understand t

Practice Auditing Questions

1. Statement on Quality Control Standards No. 2 identifies certain quality control elements that should be considered when performing which types of services? a. auditing, accounting, and review services b. auditing, tax, and review services c. accounting, tax, and review services d. auditing, accounting, and tax service

Should FASB converge with IASB? How will impact auditing standards?

As you look at financial statements audits it is important to gain an understanding of the rules and regulations that govern the profession. First from an audit standpoint you have US Generally Accepted Auditing Standards (GAAS). You should think of these standards as the guidelines that are used by the auditor on how to cond