Under the Private Securities Litigation Reform Act (the Act), independent auditors are required to firsta. Report in writing all instances of noncompliance with the Act to the client’s board of directors.b. Report to the SEC all instances of noncompliance with the Act they believe have a material effect on financial statements if the board of directors does not first report to the SEC.c. Report clearly inconsequential noncompliance with the Act to the audit committee of the client’s board of directors.d. Resign from the audit engagement and report the instances of noncompliance with the Act to the SEC.
Under the Private Securities Litigation Reform Act (the Act), independent auditors are required to firsta. Report in writing all instances of noncompliance with the Act to the client’s board of directors.b. Report to the SEC all instances of noncompliance with the Act they believe have a material effect on financial statements if the board of directors does not first report to the SEC.c. Report clearly inconsequential noncompliance with the Act to the audit committee of the client’s board of directors.d. Resign from the audit engagement and report the instances of noncompliance with the Act to the SEC.
Chapter2: Audits Of High-risk Accounts
Section2.10: Locateplus Holdings Corporation
Problem 1Q
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Under the Private Securities Litigation Reform Act (the Act), independent auditors are required to first
a. Report in writing all instances of noncompliance with the Act to the client’s board of directors.
b. Report to the SEC all instances of noncompliance with the Act they believe have a material effect on financial statements if the board of directors does not first report to the SEC.
c. Report clearly inconsequential noncompliance with the Act to the audit committee of the client’s board of directors.
d. Resign from the audit engagement and report the instances of noncompliance with the Act to the SEC.
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