Auditing Hw Solutions

The factor that plays the greatest role in determining auditor independence is independence in mind. Auditors may or may not appear to be independent, but if the auditor is truly independent in mind, then the auditor can remain objective and unbiased. The profession should consider tightening the Code of Professional Conduct to address the issue of an audit team member knowing a close friend that holds any position at the audit client. If this scenario arises, the firm can still audit the client, but the audit member with the close relationship won’t be able to be on the audit team.

Assets are to be recorded and valued based of the type of asset there are.

Item 5.|  |MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES|  | |20|  |

Confirmation is the process of obtaining and evaluating a direct communication from a third party in response to a request for information about a particular item affecting financial statement assertions. It describes the concept of assessing inherent and control risks, determining the acceptable level of detection risk, and designing an audit program to achieve an appropriately low level of audit risk. The auditor uses the audit risk assessment in determining the audit procedures to be applied, including whether they should include confirmation. The greater the combined assessed level of inherent and control risk, the greater the assurance that the auditor needs from substantive tests related to a financial statement assertion.

1. Current liabilities 2. Usual valuation of long-term liabilities 3. Disclosure notes 4. Long-term liabilities 5. Commercial paper

In this course, students are introduced to the conduct of fraud examinations, including a discussion of specific procedures used in forensic accounting examinations and the reasoning behind these procedures. Topics include an overview of fraud and abuse, forensic evidence, substantive procedures for cash outflow irregularities, substantive procedures for asset irregularities, financial statement fraud, and examination reporting.

A review and an audit report are both a form of an attestation engagement. A Review, however, is less in scope so it provides a moderate level of assurance on the financial statements. It is considered a “sniff” of an audit, which comparatively provides reasonable assurance that no material misstatements occurred. Since a review deals with a limited scope, it does not provide the basis for expressing an opinion on the presentation of the

How will the auditor most likely utilize the bank reconciliation as evidence in the audit of cash?

Read the attached audit case and answer all the questions that follow. A total of 90 points are available for the actual responses to the questions and 10 points are available for presentation, clarity and grammar. Total points for the assignment are 100.

Must be obtained by possession. There must be an agreement by the debtor granting the creditor a security interest in particular property(collateral) or the secured party must have possession of the property.

The assertion is valuation/allocation and completeness for the accounts, and presentation/disclosure to inform statement users of the recall and its ramifications.

Another point I will address is the major issue of verifying the ending balance in property, plant and equipment is the possibility of legal encumbrances. I will discuss any specific concerns I may have. I I will describe the procedures that I will undertake to obtain evidence about existing legal encumbrances.

liabilities he owes and the amount of capital he has. Normally, the lists of assets should be

According to ICAEW, auditor independence mainly refers to the independence of the external auditor from parties that have an interest in the financial statements of the business being audited. It requires having both integrity and an objective manner to the auditing process. In order for the concept to be deemed effective the auditor needs to carry out their work freely. One of the main purposes of auditing is to increase credibility of the entity’s’ financial statements, as they have expressed their own professional opinion on the truth and fair view in accordance with the proper accounting standards used. This is only possible if the audit is made with reasonable assurance that it has come from an independent source and has not been influenced by other parties, such as managers, directors or by conflict of interest.

The Auditing Concepts Committee (American Accounting Association [AAA] 1972) defined auditing as “a systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between those assertions and established criteria and communicating the results to interested users.” This definition clearly shows that the focus of auditing is verification of assertions made by managements, including the proposed financial reports (Alles et al. 2004). Continuous auditing (CA) broadens this concept by proposing timelier assurance, generally with less aggregated (or transactional) data than traditional auditing.