Rules governing the investment practices of individual certified public accountants prohibit them from investing in the stock of a company that their firm audits. The Securities and Exchange Commission (SEC) became concerned that some accountants were violating this rule. In response to an SEC investigation, PricewaterhouseCoopers fired 10 people and spent $25 million educating employees about the investment rules and installing an investment tracking system. Why do you think PricewaterhouseCoopers took such extreme steps in response to the SEC investigation?

Q: Section 301 of the Corporations Act requires companies to have their financial reports audited.…

A: Auditing: Auditing refers to an independent examination of financial information of any…

Q: You are the auditor of the Oman Construction Company and have started planning for the 2020 audit…

A: Generally what happens when a person is in rational difficulty, he finds  a logical reason to prove…

Q: Until its involvement as Enron’s auditor, Arthur Andersen was recognized as one of the most…

A: A corporation is a separate legal entity from its owners. Many of the same legal rights and…

Q: For each of the following management scenarios, (1) indicate whether you believe the scenario…

A: Scenario 1: In the given scenario, plenty of cross-organizational transactions are done for the…

Q: Which of the following would be best considered to be an agency conflict problem in the behavior of…

A: Agency problem exist in the corporation due to the fact the owners of company and managers are…

Q: Salim is the audit manager of a team engaged on the audit of a listed company. During his initial…

A: The Guidance for the same is provided under code of ethics for professional Accountant's

Q: For each situation below identify and explain the threat and one fundamental principle that is…

A: Financial statements are the final reports of a company, prepared at the end of a financial period.…

Q: If a tech industry company has their total stockholder's equity go up by $793,000 and their Software…

A: Auditing refers to evaluating the books of accounts prepared by the company to analyze if there is…

Q: Salim is the audit manager of a team engaged on the audit of a listed company. During his initial…

A: Auditing:- An auditing is considered as the examination or verification of books of accounts of…

Q: Salim is the audit manager of a team engaged on the audit of a listed company. During his initial…

A: The neutrality of the auditor from individuals who may have a vested interest in the company being…

Q: Assume in the DigitPrint case that the venture capitalists do not provide additional financing to…

A: The stakeholders in the given case are employees of the company, banks, suppliers, and customers.

Q: According to the AICPA Code of Conduct, which of the following acts is generally forbidden to CPAs…

A: According to the AICPA Code of Conduct, the following acts is generally forbidden to CPAs in public…

Q: The following factors describe a potential audit client. For each factor, indicate whether it is…

A: Corporate governance is defined as the collection of procedures, rules, guidelines, processes…

Q: Assume that a corporate officer or other executive asks you, as the accountant for the company, to…

A: As per the Securities and Exchange Act of 1934 directives, the professional accountants and auditors…

Q: Salim is the audit manager of a team engaged on the audit of a listed company. During his initial…

A: Ethics of professional accountant:   This is a set of principles that an accountant follow to…

Q: Salim is the audit manager of a team engaged on the audit of a listed company. During his initial…

A: Professional accountants are certified public accountants who can audit a business entity on the…

Q: An employee, Fred, working in the accounts office of a medium-sized company listed on the Nairobi…

A: GIVEN   An employee, Fred, working in the accounts office of a medium-sized company listed on the…

Q: Which of the following statements is true? The CPA firm will lose its independence if: A. a staff…

A: Meaning of Independence Independence generally implies one’s ability to act with integrity and…

Q: vestigations into the corporate scandals of the recent past revealed that the accountant did not…

A: Accountants and auditors are put in place so that they can give assurance that the company is…

Q: what kind of threat to the fundamental principles of professional ethics in the above situation?

A: There are various threats involved in the professions. These are :  1. Self interest threat 2. Self…

Q: An audit firm has been asked by a client to attend a meeting between the client and its prospective…

A: An audit firm has been asked by a client to attend a meeting between the client and its prospective…

Q: What kind of support will the auditor provide in the case stipulated in the following case for the…

A: Professional Accountant also known as auditor are the professional body eligible to review, and…

Q: When employees have a conflict of interest between their personal compensation and provision of…

A: Management and owners of a company are different. Management is compensated in order to run the…

Q: One2Three Corporation hired you as internal auditor. Your first engagement is to evaluate the…

A: Internal control may be implemented in almost every area in which the risk of fraud and theft…

Q: KPMG is the auditing firm for Tech Corporation, a listed computer software company. The audit team…

A: Ans. As per the given case, the audit team members do not have updated knowledge or expertise on IT…

Q: Which of the following statements is/are correct? O a. The ban on simultaneously offering consulting…

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Q: Until its involvement as Enron’s auditor, Arthur Andersen was recognized as one of the most…

A: Financial statement fraud refers to the willful misrepresentation of financial statements by one or…

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A: To lower the amount of the depreciation expense in the financial statement management has increased…

Q: The Sarbanes-Oxley Act Created the Private Company Accounting Board. Allows accountants to audit…

A: Sarbanes Oxley Act:In order to protect the rights of an investor from fraudulent practices done by…

Q: auditor is appointed

A: Correct answer is :- B   It is conducted by the employees of the company.

Q: Salim is the audit manager of a team engaged on the audit of a listed company. During his initial…

A: Here the situation for the Auditing firm to face was the sever staff shortage during the time of…

Q: Kim Company, a CPA firm, conducted an audit for the 2020 financial statements of Erin Corporation.…

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Q: Lana Company, a CPA firm, conducted an audit for the 2020 financial statements of Yara Corporation.…

A: Audit risk include inherent risks.  This risk is caused by an error or omission arising from factors…

Q: not true about Internal Audit

A: Option b is wrong because the statement is true. The internal auditor is appointed by the…

Q: Hatfield Industries is a large manufacturing conglomerate based in the United States with annual…

A: Financial statement fraud refers to deliberate manipulation of financial statements. Manipulation of…

Q: Salim is the audit manager of a team engaged on the audit of a listed company. During his initial…

A: Auditor:- An auditor may be an individual or group of individuals, who are appointed by the company…

Q: The Public Company Accounting Oversight Board (PCAOB) was created as part of a series of accounting…

A: As a part of the accounting reforms, PCAOB has been formed by the low of administration…

Q: Why have there have been so many business scandals mentioned in the media over the past few years?…

A: Solution-     Why have there have been so many business scandals mentioned in the media over the…

Q: Hatfield Industries is a large manufacturing conglomerate based in the United States with annual…

A: Earlier, the equipment lease is recorded as a capital lease in the financial statement. Later,…

Q: what is Professional Accountants’ code of ethics, in the above situation?

A: There are various code of ethics that the professional accountant has to comply . These are as…

Q: After certain high publicity frauds occurred, congress passed legislation that required auditors to…

A: Publicly traded companies are those companies whose shares can be owned by general public. These…