Auditing

disposed of and not counted as we were aware of an issue that Smackey was having with the handling of returned inventory. In order to confirm the accounts receivable balances, I decided to use positive confirmations since this was my first time auditing the company and the collateral for the loan would be the receivables. The confirmations helped to verify the accuracy and existence of the accounts. I also calculated the Receivables Turnover Ratio in order to better evaluate the overall success

According to Pompper (2014), “incidents of high-profile deception over the past” four decades “have threatened the reputation of the … accounting function” (p. 131). For instance, an investigation was conducted into the financial audit and reporting process after the savings and loan banking crisis in the 1980s (Pompper, 2014). In addition, the criminal convictions of executives and bankruptcies of Fortune 500 companies such as Enron and WorldCom in the turn of the century motivated Congress to

This title consists of 9 sections that instruct in the behavior of auditing firms and establish guidelines for external auditor independence. It also sets restrictions for clients outside of auditing boundaries and requirements for audit partner rotation. Title III is Corporate Responsibilities. These eight sections state the financial and accounting responsibilities of public companies

of an auditor, the auditor should refer to a) Statements of the Financial Accounting Standards Board. b) Generally accepted auditing standards. c) Interpretations of the Statements on Auditing Standards. d) Statements on Quality Control Standards. Answer B is correct because auditors are responsible for compliance with generally accepted auditing standards and comparison of their performance against these standards is appropriate. 62. A basic objective of a CPA firm is to provide

Analyzing Audit and Fraud Risks Audit risk, as defined in SAS No. 47, under “Audit Risk and Materiality in Conducting an Audit”, is the kind of risk that an auditor may unknowingly take by failing to make corrections as per their opinions on financial statements that are materially misstated (Riahi-Belkaoui, and Picur 34). SAS represents audit risk in the form of a model that comprises three different risks. There is the control risk, the inherent risk and detection risk. This is known as the Audit

re-defined repeatedly over the history of audit and is still generating considerable discussion in recent years, at the hand of financial crisis and a number of huge scandals, such as Enron – WolrdCom – Parmalat – Satyam Computer Services, which caused auditing to become headline news, and therefore widened the expectations gap between the audit firms and the public, and raised further questions about the audit value to society. “In the 19th century, detection of fraud was an audit objective and it the

The internal controls of a company show the extent of adherence to accounting standards and internal auditing standards as postulated by the IASB. In the case of Smackey Dog Foods, we realize that there are so many issues pertaining internal controls. The company thus has hired external auditors to perform an audit of its internal operations to reveal all the perceived weaknesses in internal controls and provide recommendations for improvement. Smackey Dog Foods has not been specifically stated as

Introduction Auditing is all about assessing the financial statements of a company in order to obtain reasonable assurance that they are prepared in accordance with the appropriate conceptual frameworks. The financial statements must give a true and fair view therefore auditors are responsible in detecting if there are risks of material misstatements caused by intentionally misstating or omitting items. Auditors must follow all ethical principles and should adhere to auditing standards in order to

As accountants and auditors we are held to, and must comply with, two standards of professional conduct. Those standards are generally accepted accounting principles (GAAP) and generally accepted auditing standards (GAAS). GAAP enforces the uniform standards for preparing and presenting financial statements. GAAS governs the ways and means are used by public accountants when conducting an audit. GAAS establishes the standards for field work and mandates that sufficient evidence be found to provide

audit reports of 2014, and 2015 we can see that there was communication between both parties that is the auditors and the accountants of the firm. The ISA was used as a guideline on how the auditors communicated with the accountants by guiding the auditing team on the specific items that needed communication with the governance group. This enabled both teams to understand matters that related to audit and also was a base for a working relationship that was constructive. The auditors focused on this