|Concept |Application of Concept in the Scenario |Reference to Concept in Reading | |Shift in Corporate Power |By appointing a board that is approved by the investor, this effective shift|“…But, in the last decade, and especially | |from CEO to Stakeholders |will occur. In today’s business environment the board plays an active role |in the past five years, boards of directors| | |in decisions as opposed
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due to error or fraud, and to design the nature timing, and extent of further audit procedures. So it is the standards that asks auditors to evaluate the soundness of a client’s business model to avoid material misstatements. 2) By means of evaluating the client’s business model, auditors could understand its ability to continue as a going concern. As a result, auditors can more accurately identify the acceptable audit risks and release themselves from being a defendant. 3) Also if the auditors
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auditor detecting material noncompliance with specific requirements governing a major federal financial assistance program in a compliance audit should issue either a qualified or adverse opinion, including the basis for the opinion. The auditor would express a disclaimer of opinion only in the event of scope limitations, which is not the case here. When the audit includes basic compliance requirements which are not applicable to a major federal program, the auditor expresses a positive opinion on
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failed to conduct investigation * Receive alert but negligence of external goalkeeper Although is a one-man-show, everyone has compromised their duties Q1 * Lack of Internal Control * Lack of supervision * Lack of proper communication * Lack of
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highlight some details for you to make the audit process a smooth one. First, you can expect an engagement letter from us within the next 5 days from the date of this letter. The engagement letter will outline our agreement to the type of audit you have selected and what our role and responsibilities will be in performing the audit as well as your own. The engagement letter is more than a letter, it also a contract that outlines the limits of the audit as well as details the scope of services we
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with the client has not been established, he or she should ordinarily a. Perform the audit with increase professional skepticism. b. Decline to accept or perform the audit. c. Assess control risk at the maximum level and perform a primarily substantive audit. d. Modify the scope of the audit to reflect an increased risk of material misstatement due to fraud. 2. An auditor should design the written audit program so that a. All material transactions will be selected for substantive testing
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1. Justify how the reporting requirements of the PCAOB reduce the chance of financial fraud. Basically, the goal of the Public Company Accounting Oversight Board is to improve quality of audited financial statements, reduce the risk of auditing failures, and increase public trust in financial reporting processes and of the auditing profession. In order for this to happen PCAOB must refocus and remind auditors of the standards required of them regarding fraud and for them to be diligent about their
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United States Government Accountability Office GAO February 2009 GAO-09-232G FEDERAL INFORMATION SYSTEM CONTROLS AUDIT MANUAL (FISCAM) This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if
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financial statements of public companies. The provisions of the Act dramatically changed the relationship between publicly held companies and their audit firms. For example, SOX significantly narrow the scope of non-audit services that may be provided to the audit client. Now, certain consulting services are illegal when services are rendered by the audit firm. Also, the SOX require the CEO and CFO of public companies to certify the annual and quarterly financial statements filed with
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AUDITING STANDARD No. 3 – Audit Documentation June 9, 2004 AUDITING AND RELATED PROFESSIONAL PRACTICE STANDARDS Auditing Standard No. 3 – Audit Documentation [Effective pursuant to SEC Release No. 34-50253; File No. PCAOB-2004-05, August 25, 2004] 302 As of February 15, 2005 Public Company Accounting Oversight Board Bylaws and Rules – Standards – AS3 Auditing and Related Professional Practice Standards Auditing Standard No. 3, Audit Documentation [supersedes SAS No. 96, Audit Documentation] Introduction
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