Acc/546 Week 1 Assignment

1094 Words May 26th, 2013 5 Pages
Week 2 Discussion Questions

Chapters 6 & 8

1. Why is audit planning so important? What is the most important step in audit planning? Why is this step so important?
Posted on wed 5/8/2013
Responded to one classmates on 5/08/2013

Auditing planning is important because it helps the auditor determine his/her approach to the audit. There are two considerations that affect the approach: 1). Sufficient appropriate evidence must be accumulated to meet the auditor’s professional responsibility and 2). The cost of accumulating the evidence should be minimized. Concern for sufficient appropriate evidence and cost necessitates planning the engagement. The plan should result in an effective audit approach at a reasonable cost.
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If the client is publicly held, the auditor must also report the matter directly to the SEC. Such decisions are complex and normally involve consultation by the auditor with the auditor’s legal counsel.

3. As an auditor for Franken’s Markets, you discovered fraudulent activities. In your previous discussions with management, no one with the Franken organization identified fraudulent behavior or activity, and any questions relating to such matters were met with defensive behavior. How might you address this situation?

Post this in individual forum---answered on 05/8/2013

Who should be responsible for detecting fraud?

Please post your answer to this question to your individual forum. For example, should it be the auditors, management, the board of directors, etc.? You don’t have to post an explanation—just your answer. We’ll discuss it once I compile the results from everyone’s answers. I’ll post a summary of everyone’s answers to this thread, and we’ll see which group receives the most votes.

Miscellaneous topics:

What is the most valuable asset of an auditor, and how does it differ from the most valuable asset of an accountant? (posted on 05/09/2013)

ETHICS AS A BARRIER: (POSTED ON 5/09/2013)

Ethics is a code of conduct that dictates a person 's or group 's behavior. Many
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