Premium Essay

Auditing Week 1

In: Business and Management

Submitted By StampinPearls
Words 1069
Pages 5
Homework Assignments

2-7 The Public Company Accounting Oversight Board was established through the Sarbanes-Oxley Act to provide oversight over auditors for public companies audit, establishes auditing and quality control standards for public company audits, and performs inspections of the quality controls at audit firms performing those audits. The American Institute of Certified Public Accountants (AICPA) is responsible for issuing auditing, attestation, and quality control statements, standards and guidance to certified public accountants for private companies.

2-10 The criticism of the 10 GAAS by some critics, is founded in the belief that by the GAAS being more specific, then they would thereby eliminate some difficult audit decision and provide a line of defense for a CPA firm charged with conducting an inadequate audit. However, highly specific requirements could turn auditing into mechanistic evidence gathering, devoid of professional judgment. Therefore, from differing points of views, there is probably greater harm in defining authoritative guidelines too specifically than too broadly.

2-16. a. The first general standard, which states in part that the audit must be performed by a person or persons having adequate technical training, requires that an auditor have

(1) education and experience in the field of auditing.

b. Which of the following best describes what is meant by generally accepted auditing standards?

(4) Audit objectives generally determined on audit engagements.

c. The general group of the GAAS includes a requirement that

(2) due professional care be exercised by the auditor

d. What is the general character of the three GAAS classified as the standards of field work?

(3) The criteria of audit planning and evidence gathering.

The Mobile Home Manufacturing…...

Similar Documents

Premium Essay

Auditing Exam 1 Review

...Auditing Exam 1 Review Ch 1 Nature of Auditing: * Auditing is the accumulation and evaluation of evidence about information to determine and report on the degree of correspondence b/w the information and established criteria. * Auditing should be done by a competent, independent person. Information and Established Criteria: * To do an audit, there must be information in a verifiable form and some standards (criteria) by which the auditor can evaluate the information. Accumulating Evidence and Evaluating Evidence: * Evidence is any information used by the auditor to determine whether the information being audited is stated in accordance with the established criteria. Competent, Independent Person: * The auditor must be qualified to understand the criteria used and must be competent to know the types and amount of evidence to accumulate to reach the proper conclusion after the evidence has been examined. * The competence of the individual performing the audit is of little value if he or she is biased in the accumulation and evaluation of evidence. Reporting: * The final stage in the auditing process is preparing the Audit Report, which is the communication of the auditor’s findings to users. Distinguish b/t auditing and accounting: * Accounting is the recording, classifying, and summarizing of economic events for the purpose of providing financial information used in decision making. * Auditing is determining whether recorded......

Words: 1056 - Pages: 5

Premium Essay

Auditing Week 2 Hw

...Shelley Stiles Week 2-HW P4-18 a. (1) The auditor must be without bias with respect to the client under audit. b. (3) involves the objective examination of and reporting on management- prepared statements. c. (1) maintain public confidence in the profession 4-19 a. (1) Contingent on approval of a bank loan b. (3) c. (3) 4-20 a. Violation of AICPA and SEC based on rules of independence, if pre-approved it is okay. b. Based on SOX and SEC rules internal auditing of a public company is prohibited. c. Prohibited under SOX and SEC d. AICPA rules of professional conduct, if pre-approved it is okay. e. With pre-approval it is allowed. Normally prohibited under SOX and SEC. f. According to the AICPA, this is allowed as long as the three requirements are met. 4-21 a. Violation of independence. It is not acceptable to provide management advisory services to a client you also perform bookkeeping and auditing services for. b. He does not take part in the audit. There is no violation. c. Violation of general standards d. Violation of integrity and objectivity e. Violation of Form of organization and name. f. no violation g. violation of confidentiality h. violation of acts discreditable. 4-22 a. indirect financial interest violation b. integrity and objectivity violation c. not a violation d. violation of independence e. unpaid fees violation of Rule 101 f. violation of independence g. not a violation h. violation......

Words: 882 - Pages: 4

Premium Essay

Week 1 Discussion 1

...Networking Security Fundamentals Week 1 Question 1 "Providing Security Over Data" Please respond to the following: The CIA Triad offers three security tenets that allow data owners the framework to secure data. Considering your place of employment or your home computing environment, discuss in detail the means in which each of the three tenets are addressed to mitigate risk and enhance security in your chosen environment. In my workplace, all three security tenets are strongly enforced. Our information systems are available 99.9% of the time. We have specialists on call to support all facets of the organization, so even an unplanned outage can be mitigated by flipping to a mirror, then correcting the issue in the production environment. The integrity of the information is protected by the user account controls implemented by the data administrators, who create views and profiles for each user. Additionally, network admins restrict access to the data servers themselves. The confidentiality is also protected by the user account controls. With these in place, only authorized users are able to access or modify data. The use of mobile devices to create or access data has gained worldwide appeal and has obtained critical mass. From the e-Activity, summarize the attack and describe how you would mitigate the threat.  Mobile devices are now more alluring to attackers due to the concentration of users on a small base of operating systems. For example, prior to the launch of......

Words: 1411 - Pages: 6

Free Essay

Assignment 1 Week 1

...Associate Level Material Six Dimensions of Health Worksheet Part 1 For each of the following six dimensions of health, list at least one characteristic, activity, belief, or attitude that reflects that dimension in your life. Provide a brief explanation with each example. Refer to Ch. 1 in the text for explanations of these dimensions. Physical health: Exercise at least five days a week. Physical fitness has to be up to par to stay in the military. I usually watch my diet because I am not as young as I use to be. Social health: Right now I really do not have a social life. It might not be healthy but I guess I do it to protect myself. Having to move around a lot does not allow me to build the friendships that I am looking for. Intellectual health: Being in the military sometimes requires critical thinking to complete a mission. Many times it’s accomplishing a mission that you have already done. I usually refer back to those past missions and put together the pieces that I need to accomplish the new one. I take to account failures and successes of my past missions and use it for the current one. I also take in to account other people’s failures and successes. Environmental health: I try to surround myself with people I can learn from. At the beginning of my career I use to hang out with soldiers who were not looking to approve themselves and just got into trouble. Once my son was born, I knew the life had to change. I decided to work on bettering......

Words: 609 - Pages: 3

Premium Essay

Auditing and Assurances Eighth Edition Week One Homework

...Auditing and Assurances Eighth Edition Week One Homework 1-26: a. Auditing evidence could be defined as the more relevant and accompanying data and information which helps the auditor in their evaluation of financial documents. b. The management of an accounting firm will ultimately make the assertions about the many parts of the financial statements that they are handling or are in question. Such assertions are a tool to assist them in making sure that they have not overlooked any components that might be detrimental to the overall integrity of their reports. For example, if a given financial institution lists accounts that might be receivable for a specific amount, the management is “asserting” that such receivables are truly in the institution’s possession and are appropriately valued or appraised and are not just “approximations.” c. When searching for and evaluating evidence auditors must be concerned about the reliability and relevance of the evidence that they are utilizing in their reports. Otherwise, invalid derivations and conclusions will be reached in regards to the management’s assertions. Furthermore, the reliability of the evidence that they use will attest as to the ability of such evidence to show the real state of their assertions. 1-27: a. There are many phases to an audit that is to be evaluated and executed properly. First of all, auditors must determine if they are going to accept a new client or continue with a client that is already using......

Words: 1017 - Pages: 5

Premium Essay

Week 1 Dq 1

...Week 1 DQ 1 What is strategic management and planning? Strategic management is the set of choices, activities that result in the preparation, and then carrying out in the plans that are designed to succeed in an organization’s objectives. Strategic management, planning is critical to the success of any organization through strategic planning an organization has the ability to open the door wide open for opportunity. Why would a strategic plan be important to the success of this business? Strategic planning is very important to an organization it define the organization’s values, create an organized visions to chart the direction of the organization this includes setting goals for future growth of the organization. The process begins with the statement of the organization’s vision, their objectives, their current organization’s strengths, weaknesses, available opportunities, and possible threats. Management develops implements and monitors a strategy. How are the four functions of management relative to creating and implementing a strategic plan? The four functions of management Planning, organizing, leading and controlling are relative to creating and implementing a strategic plan because it provides the necessary tools for building and organizing a plan to be successful. The four functions of management allow a plan to be successfully executed in an organization. The business I would like to start would be an old time malt shop called a Step Back in Time. It would......

Words: 316 - Pages: 2

Premium Essay

Auditing Assignment Week 4

...Homework Chapter 5 Auditing – ACC403 October 31, 2010 In the Smith case, the independent CPA was wrong for so many reasons. A CPA firm is hired to basically keep an organization honest. When obtaining your CPA, it is clear that you should never buy into a company’s scheme of falsifying information for financial misstatements. Smith received the anonymous letter revealing a fraudulent plan that Juniper had to gain a loan from a bank. Once Smith confirmed the plan, he should have proceeded with the appropriate steps for a qualified opinion for Juniper. Instead Smith allowed the president of Juniper to intimidate him which now puts him in a position to not only be sued by the bank, but by the lessor also. The lease should have never been listed as operating and Smith was aware of this. Smith should have done the right thing regardless of the threats. According to the text, audit failure occurs when the auditor issues an incorrect audit opinion because it failed to comply with the requirements of auditing standards. This is exactly what occurred in this case. Smith knowingly issued an incorrect opinion. Once this is proven, Smith will be liable to the bank and the lessor. In cases of audit failure, the law often allows parties who suffered losses to recover some or all of the losses caused by the audit failure. Under common law, auditors have a responsibility to fulfill implied or expressed contracts with clients. The criteria for legal actions against......

Words: 303 - Pages: 2

Premium Essay

Auditing 9th Chapter 1 Answer

...Liuting Han Accounting 439, Sec #01 Assignment #1 1-25: The objective of external auditing is to provide opinions on the reliability of the financial statements and, as a part of an integrated audit, provide opinions on internal control effectiveness. The overall objective of external auditing is to ensure that the financial statements of an organization are correct and are in order. The external audit is intended to enhance the confidence that users can place on management-prepared financial statements. When the auditor has no reservations about management’s financial statements or internal controls, the report is referred to as an unqualified audit report. If the auditor had reservations about the effectiveness of the client’s internal controls, the auditor would issue an adverse opinion on internal controls. The auditors should find fraud, require accounting principles that best portray the spirit of the concepts adopted by accounting standard setters, and be independent of management. Managements need the unbiased and correct financial information to make operational decisions. Shareholders need the information to decide to invest or not. Tax authorities need the information to determine taxable income. 1-31: a) Describe the unethical actions of Susan Birkert. Susan Birkert told her friend the stock of Cometech Corporation that she was auditing was a good investment. Also, she agreed to her friend to purchase stocks on her behalf and she gave her......

Words: 947 - Pages: 4

Premium Essay

Auditing 1

...Question 1 (7 marks) The following are independent statements concerning certain auditing issues. Required Indicate whether you agree or disagree with each statement, and explain your reasoning. a. An adverse report would be issued when an auditor was unable to observe a company’s inventory count at the beginning of the year because the auditor was appointed during the year. (1 mark) b. When encountering a violation of generally accepted accounting principles in an audit of financial statements, the auditor will decide between an unmodified report, a qualified report, or a disclaimer of opinion report. The main consideration will be the materiality of the matter in question. (1 mark) c. A public accountant is not required to be independent of an entity to perform a compilation engagement for that entity. In such a situation, however, disclosure of a lack of independence is not required. (1 mark) d. If there is significant doubt and material uncertainty that an auditee will continue operating in the future and these doubts have been properly disclosed in the notes to the financial statements, the auditor is required to include an emphasis of matter paragraph in the audit report. (1 mark) e. When replaced as auditor, the outgoing auditor has a professional responsibility to reply promptly to an enquiry letter from the incoming auditor, but is not required to allow the incoming auditor access to the most recent year’s audit working papers. (1 mark) ......

Words: 1982 - Pages: 8

Premium Essay

Chapter 1 Auditing Theory

...Auditing Theory -Auditing and Assurance Services- An integrated approach Chapter 1 The assurance service market Objective 1-1 describe auditing: Auditing: accumulation and evaluation of evidence about information to determine and report on the degree of correspondence between the information and established criteria. Auditing should be done by a competent, independent person. Evidence: any information used by the auditor to determine whether the information being audited is stated in accordance with the established criteria. To satisfy the purpose of the audit, auditors must obtain a sufficient quality and volume of evidence. Forms of evidence: - Transaction data - Client testimony - Written and electronic communications with outsiders - observations To do an audit there must be information in a verifiable form and some standards (criteria) by which the auditor can evaluate information. The auditor must be qualified to understand the criteria used and must be competent to know the type and amount of evidence to accumulate in order to reach the proper conclusion after examining the evidence. The auditor must also have an independent mental attitude. The final stage in the auditing process is preparing the audit report which communicates the auditor’s findings to the users. It must inform the readers of the degree of correspondence between information audited and the established criteria. Objective 1-2 distinguish between auditing and accounting Accounting:......

Words: 874 - Pages: 4

Free Essay

Acc 492 Contemporary Auditing Ii Week 1 to 5 with Final Exam

...Contemporary Auditing II Week 1 to 5 with Final Exam Purchase here Product Description ACC 492 Contemporary Auditing II Week 1 Individual Assignment from the Text, 14-28, 14-30 Discussion Questions 1, 2 and 3 Week 2 Individual Assignment from the Text, 16-33, 16-35 Learning team Apollo Shoe Case Assignment Learning Team Payroll Schedule Discussion Questions 1, 2 and 3 Week 3 Individual Assignment from the Text, 16-26, 16-29 Learning team Apollo Shoe Learning team Apollo Shoe Case Assignment Discussion Questions 1, 2 and 3 Week 4 Individual Assignment from the Text, 17-22, 17-26 Individual Case Study Assignment Learning Team Apollo Shoe Case Assignment Learning Team Apollo Shoes Case Prepaid and Fixed Assets Learning Team Assignments from the Text, 17-27, 18-31 Discussion Questions 1, 2 and 3 Week 5 Individual Issuing Audit Reports Simulation Learning Team Case Study Assignment Learning Team Case Study Assignment and Presentation Sample Final Exam (36 Questions and Answers) ACC 492 Contemporary Auditing II Week 1 to 5 with Final Exam Purchase here Product Description ACC 492 Contemporary Auditing II Week 1 Individual Assignment from the Text, 14-28, 14-30 Discussion Questions 1, 2......

Words: 538 - Pages: 3

Premium Essay

Week 1

...sharing area and the final submission must be available for the team to review and approve each week. Approval can be achieved by downloading the document. If you have disagreements, it is critical to contact your project leader and get a correction posted immediately. The professor should be notified of any disagreements. If the statement of participation is not submitted, the entire team will receive the same grade (including any point loss from other team members). I. Team Information PROJECT NAME: | MEMBER NAME | # | PHONE # | | EMAIL | | MEETING AVAILABILITY | Jade Xiong | 1 | | | | | Monday at 5 / email/ phone | Raquel Godoy | 2 | | | | | Monday at 5/ email/ phone | Genaro Zavala | 3 | | | | | Monday at 5/ email /phone | | 4 | | | | | | | 5 | | | | | | | 6 | | | | | | II. Weekly meeting schedule The most successful teams schedule at least (2) meetings a week throughout the course. Scheduling standing meetings allows everyone to schedule this time in advance and coordinate other activities around the scheduled meeting times. Meetings can change, based on the project leader for the week, however, it is highly recommended that you set a meeting based on the majority team availability. In addition to setting meetings, the most successful teams also set a deadline for drafts to be turned into the project leader each week. Putting this structure in place early in the course will help the team to achieve a high......

Words: 1698 - Pages: 7

Premium Essay

Week 1 Dq 1

...Week 1 DQ 1 Why is it important that financial accounting systems report performance fairly and factually? Financial accounting systems are responsible for recording, monitoring and maintaining all financial and accounting transactions within an organization. It is crucial that financial accounting systems report performance fairly and factually because the information within the system is required for the organization to make good economic decisions that could make or break the entire business. The reports that are created by financial accounting systems are used to provide information to outside parties such as tax experts, creditors, and/or potential investors. Inaccurate financial reports can lead an organization to experience legal issues, financial fraud, and can cause a bad reputation for the overall organization. In order to maintain and grow a profitable business, organizations must rely on fair and factual financial reports. Financial accounting systems must also report performance fairly and factually to ensure that the organization is performing and operating properly. An inaccurate financial report, for example, can cause an organization to make an economic decision that the organization may not be able to afford to do. In a health care organization, financial reports must also be accurate to avoid errors in medical billing that can lead the organization to lawsuits and major financial losses. Financial reports that are not created fairly and......

Words: 595 - Pages: 3

Premium Essay

Auditing Chapter 1

...Chapter 1 Multiple-Choice Questions |1. |Recording, classifying, and summarizing economic events in a logical manner for the purpose of providing financial | |easy |information for decision making is commonly called: | |c |a. finance. | | |b. auditing. | | |c. accounting. | | |d. economics. | | | | |2. |In the audit of historical financial statements, which of the following accounting bases is the most common? | |easy | | |c |a. Regulatory accounting principles. | | ...

Words: 2738 - Pages: 11

Premium Essay

Week 1

...2-7 - The PCAOB (Public Company Accounting Oversight Board) was created by the Sarbanes-Oxley Act to oversee auditors of public companies to establish auditing standards. For privately held companies the ASB (auditing standards board) provide auditing standards. Prior to PCAOB, ASB also provided guidelines for public companies. 2-10 The GAAS were not supposed to be a step-by-step set of instructions in how to conduct an audit but rather they are meant to represent a framework for the audit to be conducted within. 2-16 A-1 B-3 C-3 D-4 2-20 A - It could be argued that under GAAS "General Qualifications and Conduct" that the CPA Firm does not meet the "Adequate training and proficiency" criteria since they have never had a client go public before. B - Since public companies are covered by PCAOB and private audits under ASB they may not be familiar with all rules and regulations. 3-23 A-2 B-3 C-3 3-25 A-2 B-3 C-2 3-26 A- It should clearly state that it is an opinion and not be represented as absolute facts. The second phrase is definitive in character. B - The country of origin is not mentioned in second phrase. Accounting laws differ between countries so the accounting base guidelines are implied when country is listed. C - The second paragraph doesn't state that it is an opinion based on the audit. D - The CPA firm has the legal responsibility and should be listed, not the individual auditor. E - The first statement includes the......

Words: 277 - Pages: 2