Hong Kong Establishing an Audit Committee for Companies

* From the e-Activity, choose one (1) of the eight (8) steps in the Clarified Auditing Standards–Learning and Implementation Plan. Based on the step you have chosen, analyze support for the action plan proposed, and make at least two (2) recommendations that would improve support of the action plan.

Read the auditor’s report included in the annual report of the company and explain its purpose. Identify the name of the auditing firm.

The purpose of this memo is to document the planning of the financial statement audit

The purpose of this paper is to discuss the SEC’s influence on auditing a private company and the essential activities involved in the initial planning of an audit. Next the discussion will delve into four stages of the audit and tasks performed by the auditors as well as internal control findings and various aspects of the audit.

The only aspect of an audit report that I was aware of is the inclusion of the four financial statements – statement of cash flows, balance sheet, income statement, and statement of retained earnings. It is the auditor’s job to express an opinion on the financial statements based on the review I did not know all of the detail that a report entails. I originally thought only the statements were given with no explanation. However, it is comprised of notes to financial statements to supplement the analysis, which includes endowment funds summary, income tax exemption information, recommendations, and the independent auditor’s report which outlines management’s responsibility as well as the auditors, their opinion, and report on summarized comparative

The objectives an audit team hopes to accomplish by preparing a proper set of audit workpapers is to facilitate the planning, performance, supervision of the engagement, and provide evidence supporting significant conclusions by the auditor in accordance with the PCAOB. A record of the evidence, samples tested and the conclusions are presented to supervisors and partners for review

The Audit Committee assists the Board in regard to financial reporting, audit and risk management, including:

The Audit Committee is comprised of the following five members from the Board; F. Duane Ackerman, Ari Bousbib, J. Frank Brown, Karen L. Katen, and Mark Vadon. This group is tasked with assisting the Board with the oversight of The Home Depot’s financial statements, ensuring that they are in compliance with legal and regulatory requirements. They also review and monitor the Company’s Compliance program, making changes when appropriate to ensure that the Company remains compliant. This committee must be comprised of three or more independent directors from the Board and they cannot receive any compensation other than directors’ fees from Home Depot. A requirement for this committee is to have a basic understanding of

The audit committee’s responsibility was to look over the accounting and financial reporting process as well as the financial statement audits; appoint, compensate and oversee the external auditor; and to ensure that the company has a whistleblower program. (p. 52) At first glance the committee could notice that something was not right with the company’s financial records. But nothing was done and nothing was said.

The audit committee is responsible for the following. It is responsible for reviewing the financial statements, for reviewing the company's compliance and control systems, for monitoring the effectiveness of the internal audit function, assessing the independence and objectivity of the external auditors, and ensuring the employees have the opportunity to raise concerns about matters of financial reporting. The audit committee supports the Board. Ultimately, because the audit committee is comprised of members of the Board, they are elected by the shareholders. Should the shareholders decide, they can replace these members at the annual meetings.

Under the audit and examination committee, they have to regulatory and oversight the conduct risk of the entity, in addition, they have to disclose the security risk, operational risk and technology risk. Moreover, audit and examination committee required to oversight the internal audit function, external auditor performance and disclosure framework for financial and risk reports prepared for the board, management, and third party agencies. The committee should provide greater centralization of review and oversight and augment reporting to the board of the type of issues that contributed to breakdown in Wells Fargo’s sales culture.

Audit quality is an important element of corporate governance – although it’s unclear whether audit quality and other aspects of corporate governance (e.g. director knowledge and independence) are fundamentally complements or substitutes.

The Committee shall report on its work to the Board of Directors. It shall submit to the Board its findings, recommendations and suggestions. The Committee may request any and all accounting, legal or financial documents it deems necessary to carry out its responsibilities.

Strategic objectives- pertain to value creation management makes on behalf of shareholders. Longterm strategies look

Ensure the security of shareholders rights with respect to secure ownership of their shares, their voting rights, ensuring shareholders’ participation in decisions relating to the sale or changes in corporate assets, and ensure shareholders’ right to