Chapter 1.12, Problem 5Q

So far in the course, you have examined several different types of government financial statements and learned about government funds and operations. Choose one of the following questions to discuss: What are some areas of risk in most local governments in relation to fraud? Discuss some areas of government funds or operations where you believe internal controls should be implemented, such as independent verification or separation of duties. How could these internal controls help prevent fraud in government operations? Among the suggestions from your peers, which controls do you believe will be most effective, and why?

Which of the following is one of the changes in the Revised ISA 700 on audit reporting? a. the audit opinion will now become more like a guarantee on the fairness of the financial statements b. all of the above c. the opinion is required to be presented first, unless law or regulation may prescribe alternate presentation d. the auditor’s responsibility paragraph include a statement that the auditor will now proactively search for fraud

When auditors become aware of noncompliance with a law or regulation committed byclient personnel, the primary reason that the auditors should obtain a better understanding ofthe nature of the act is toa. Recommend remedial actions to the audit committee.b. Evaluate the effect of the noncompliance on the financial statements.c. Determine whether to contact law enforcement officials.d. Determine whether other similar acts could have occurred.