Investigate the history and current status of the CICA Exposure Draft on the going-concern assumption that was originally issued in 1996. Use the CICA website, CA Magazine, and other professional publications to conduct this research. Explain how the due process involved in setting Canadian auditing standards is illustrated by the history of this Exposure Draft.
Answer to relevant QuestionsFind Nortel’s 2004 annual report on its website or SEC filings, and review the audit reports for 2001–2004. In light of Nortel’s history, do you think these reports are appropriate? Discuss. Why does the auditor need a good understanding of the auditee’s business and environment? What important information can be found in directors’ minutes about officers’ compensation, business operations, corporate finance, accounting policies, and control? What issues arise if an auditor realizes part way through the audit that a smaller materiality level is appropriate?Why does the successor auditor need to obtain the auditee’s consent in order for the predecessor auditor to provide the successor with information about the auditee?
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