The Past Five Years Auditing

1199 Words5 Pages
Independence Over the past five years auditing VHL I have developed close friendships with some board members who are responsible for maintaining internal controls and financial operations in the organization. As a CGA I am bound by CEPROC, which states that I must remain independent in appearance and fact in order to provide an unbiased objective opinion. I feel these relationships, and the length of time I have audited VHL, could lead to a familiarity threat that would inhibit my ability to apply professional skepticism and jeopardize the audit. Due to the level of influence the board has over the organization and the finances it is unlikely that acceptable safeguards could be applied, therefore I must decline to continue any further with this audit, and request someone else assume my role. Segregation of Duties In a not-for-profit organization, such as VHL, with limited financial resources there is a higher risk that segregation of duties will be compromised as employees often hold multiple roles and responsibilities, as is the case with the accounting functions at VHL. With only one accountant responsible for deposits, custody, disbursement of funds, maintaining financial records and preparing financial reports it raises the risk for potential material misstatement due to error or fraud. This could erode the trust and confidence the stakeholders have in VHL and their stewardship of contributed resources, possibly impacting future donations. This must be taken into
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