homework7

5. When assessing audit risk, should auditors consider the type and number of third parties that may ultimately rely on the client¡¦s financial statements?

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

Compare the primary auditor objectives in auditing historical financial statements to auditing internal controls over financial reporting. Identify at least two (2) objectives that are the most significant in reducing the risk of reporting errors or misstatements in financial statements. Provide a rationale for your response.

Your paper this week should explain in your own words the responsibilities of auditors in understanding the security risks facing their organization with the use of cloud services. How has auditing's role changed as we've moved from client-server architecture to the cloud model? Include steps auditors must take to assess the level of compliance of the CSP with standards. Provide examples of how auditors assure due diligence when it comes to security and risk.

1. A budget is a formal statement of future plans, usually expressed in monetary terms.

An unauthorized and highly sophisticated malware that not been encountered previously by any security company attacked the point-of-sale systems where all the card information is stored. The outcome of this hacking been extensive and affected millions of customer’s personal and payment data was exposed, results in the payment card compromise of three million customers.

Go to Kubasek, Chapter 13, page 369, problem 13-16. Use LexisNexis in the Keller library and look up the Nadel et al. v. Burger King Corp. & Emil, Inc. case. Use the citation you find in your book to do the search. Read the case and answer these questions. Copy and paste this information into a Word document, include your name on that document, and answer the questions.

Discuss what you believe to be the appropriate level of involvement of an accountant in evaluating and selecting an AIS vendor and the AIS itself. What are some of the contributions an accountant might offer in this process?

In January 2007, TJX Companies Inc. released a statement to the press that an estimated 40 million of their customer’s credit card accounts had been compromised (although final reports state that over 94 million accounts were affected) (Berg 2008). Through the company’s POS (Point of Sales) system, credit card information was stolen by a ring of hackers and approximately $4.5 billion spent on these cards (Berg 2008). What the hackers did was intercepted the credit card information from customers who swiped their cards at the store and then created their own physical cards using this information. Then they sold the credit cards to people, who turned around and used these cards at retail stores, like Walmart (Agrawal 2011). Three areas of weakness within the company’s IT systems that allowed for an attack of this scale were: inadequate wireless security, improper storage of customer data and failure to encrypt customer account data (Berg 2008).

For unit 9, the class would reach chapter 15. First I would like to start by saying I had a lot of appreciation for chapter 15. It’s completely different from all of the other chapters and gives some extremely good insight to actually practicing security on your own terms, setting up your own practice area at home, as well as what may or may not be expectable for trial and error at your intended place of employment. Chapter 9 is based around an administrator’s perspective. It’s a great overview of topics such as solution ideals, guidelines, outlines, and best practices. It’s a chapter that will keep me reading it again and again through different points in my career I’m sure.

1. List three types of consulting services that audit firms have provided to their audit clients in recent years. For each item, indicate the specific threats, if any, that the provision of the given service can pose for an audit firm’s independence.

On January 2007 a press release was issued according to CPA journal article “Analyzing the TJ Maxx Data Security Fiasco” that TJX Companies, Inc. the parent company to retail stores like TJ Maxx, Marshalls, HomeGoods, and A.J Wright stores; computer systems had been breached and that customers’ information had been stolen. (Berg, G. 2008, August) This data breach became the largest one of it’s kind because during the investigation there was reported that approximately 94 million Visa and MasterCard accounts had been compromised (Berg, G. 2008, August).

4. Discuss the scope and nature of an auditor’s responsibilities during a review of client’s quarterly financial statements.

4) Examine two cases where forensic accountants have provided vital evidence in a case, summarizing their importance to the case.

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: