Ligand Phamaceuticals

Since its inception, the PCAOB has been criticized by many parties. Summarize the principal complaints that have been directed at the PCAOB. Do you believe this criticism is justified? Explain. What measures could the PCAOB take to improve its effectiveness as a regulatory body?

The mission of the PCAOB is to oversee audits of public corporations to protect the interests of the investor and ensure the audits are conducted

Questions like What is a Ligand, or What is a antagonists role in the body are completely open ended and can lead to many different answers among students. Our game displays what role each section of the processes within the body does in a simple method using simple tetras like shapes. Instead of students trying to memorize a textbook definition and struggling to remember medical terms, students who play this game will figure out the roles of each part of the process naturally. No student wants to spend hours attempting to understand complex concepts. Our games goal is to motivate people to learn about these complex concepts. Giving students a means to study that does not feel like studying.

The Sarbanes-Oxley Act created the Public Company Accounting Oversight Board (PCAOB) to assume the responsibility of overseeing the auditors of public companies. The PCAOB is a private-sector, non-profit corporation. It was established to "protect the interests of investors and further the public interests in the preparation of informative, fair, and independent audit reports". (The PCAOB) Although the PCAOB is a private sector organization, it has many government-like regulatory functions. The PCAOB was created in response to an increasing number of accounting restatements by public companies during the 1990s and a series of recent high-profile scandals like Enron and WorldCom. Prior to the PCAOB, the audit industry was self-regulated

1.1/1.2/1.3 – Requires me to describe what is employee engagement and how does it differ, if at all, from related concepts like employee involvement, employee participation and employee consultation? Also how far is employee engagement something which is genuinely new and distinctive, or is it merely a repackaging of old and well-established ideas?

4) What factors in the auditor-client relationship create a power imbalance in favor of the client? Discuss measures that the profession could take to minimize the negative consequences of this power imbalance.

Auditors are responsible for evaluating accounting estimates. A part of this responsibility is to obtain sufficient evidence that all accounting estimates are reasonable and properly disclosed. In Ligand case, because the underestimation of future sales returns at the end of 2003 was significant and auditors found it material, they had to perform the audit procedures to indicate if Ligand had the ability to make reasonable estimates and eventually have the company restate its financial statements of 2003 last quarter. However, Fazio failed to exercise the due professional skepticism and issued an unqualified opinion on Ligand’s financial statements which was not appropriate.

b. Assess acceptable audit risk as high, medium, or low considering the items you identified in requirement a. (A risky client will be assessed as a low acceptable audit risk.)

From the ruling, the court ruling had on implications on the validity of the PCAOB validity. As per the ruling, the Supreme Court turned down the request by the petitioners to have an injunction on the board continued operation. Pildes (2010) had a similar conclusion. He observes that the Supreme Court Judges were shrewd to avoid eliminating the board given the conditions under which it was formed. Therefore, they chose to have the board continue its operations such as inspection, enforcement, registration, and setting of standards for boards and accounting firms. As opposed to the petitioners’ expectation, Krent (2010) notes that Free Enterprise Fund should brace for a reinvigorated as the court confirmed the board’s mandate.

Engagement is a sign of satisfaction and loyalty to the firm which can be incurred by increasing job resources

List the fraud risk factors that the CPA firm might encounter if they accept this audit engagement. Be sure to include a discussion of all items that will probably require special attention during the audit. For each of these fraud risk factors, indicate how the auditor should follow up on each potential problem if the engagement is accepted. Use the following format:

B) I think the auditors should have equal responsibility for detecting material misstatements due to error and fraud. It’s their job to make sure the financial statements are as accurate as possible. Although it may be hard to check all the information from a company it’s the responsibility of the auditor to sign off that everything is in check.

By disregarding guidelines addressing audit evidence for investments in securities, BDO violated PCAOB’s Section 332. This section outlines audit evidence and audit risk regarding investments in securities. An auditor is responsible for addressing existence, completeness, rights and obligation, valuation, and presentation (PCAOB). Auditors for

Abernethy and Chapman’s engagement team comprises of a partner-in-charge, a manager, a senior auditor, and one or more staff auditors. The partner-in-charge leads the engagement team and is responsible for all final decisions made while conducting the audit. The manager, senior auditor, and staff auditors are to perform the actual audit examination. The engagement team’s responsibility is to complete the audit with competency and objectivity.

Read and summarize the article, "Client Engagement Risks and the Auditor Search Period," by Khalil, Cohen, and Schwartz in Accounting Horizons, Volume 25, Number 4 (2011), pp. 685 - 702.