• A CPA has been engaged to audit the financial statements of a client company. The audit is being conducted after year end. Is it proper to accrue the audit fee as an expense of the year under audit? • Should an intentional misstatement which is made by the client influence the audit fee? • If an auditor gives a “going on concern opinion” should this reflect the audit fee?
ACB3-3
• Does the Audit risk Model influences the Business risk during audit procedures? • In which year should a company record the audit fee? • Which factor influence the audit fee? • What process do you have in place to identify important business risks to the company? • What is inherent risk? How can the auditor measure it? • Explain how the concepts of audit risk and materiality are related. • Must an auditor make decision on materiality in order to implement the audit risk model?
ACB 4-7
• Can Auditors be Independent? Experimental Evidence on the Effects of Client Type • In this article they have written about the aggressive accounting and the conservative accounting. What do they mean with these two terms? What is the difference between aggressive accounting and conservative accounting? • Looking at the different situations can the auditor be really independent? • There are 2 aspects in this article First the management can hire the auditor and second the oversight board can hire the auditor. Which one do you think is more accurate to mitigate the problem of independency?
ACB 3-1
• Auditor acceptance of dysfunctional behavior • What is exactly the dysfunctional audit behavior, when have the audit such behavior? • How can this DAB issues be mitigate? • While most research in the area of dysfunctional behavior has focused on the individual, it seems quite likely that the
