Review the discussion of the Parmalat fraud described in the chapter. a. Describe the audit procedures that
Question:
a. Describe the audit procedures that could have discovered the misstatements and explain why they could have been effective.
b. Why might a company set up a subsidiary to hide fraudulent transactions? Was it easier for fraud to occur and not be detected because this subsidiary was audited by a different auditor than the ones who signed the audit report? Explain your answer.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 70% (10 reviews)
a The auditor should have mailed the bank confirmation to the bank in th...View the full answer
Answered By
Sheikh Muhammad Ibrahim
During the course of my study, I have worked as a private tutor. I have taught Maths and Physics to O'Level and A'Level students, as well as I have also taught basic engineering courses to my juniors in the university. Engineering intrigues me alot because it a world full of ideas. I have passionately taught students and this made me learn alot. Teaching algebra and basic calculus, from the very basics of it made me very patient. Therefore, I know many tricks to make your work easier for you. I believe that every student has a potential to work himself. I am just here to polish your skills. I am a bright student in my university. My juniors are always happy from me because I help in their assignments and they are never late.
4.90+
14+ Reviews
24+ Question Solved
Related Book For
Auditing and Assurance Services An Applied Approach
ISBN: 978-0073404004
1st edition
Authors: Iris Stuart
Question Posted:
Students also viewed these Auditing questions
-
Review the discussion of the Sonali accounting fraud described in the chapter. a. Describe the audit procedures that could have discovered the misstatements and explain why they could be effective....
-
Review the discussion of the Parmalat fraud in the chapter. a. Why was the SEC upset about the missing debt on Parmalats financial statements? b. If you had owned stock in Parmalat, would you have...
-
Review the discussion of the Xerox fraud described in the chapter. a. Why would auditors consider performance-based compensation and stock options to be a risk factor in an audit? b. Did KPMG...
-
The North American and European continents are moving apart at a rate of about 3 cm/y. At this rate how long will it take them to drift 500 km farther apart than they are at present?
-
A sample of gas has a volume of 3.91 L, a temperature of 305 K, and a pressure of 2.09 atm. How many moles of gas are present?
-
The following data pertain to Alexis Electronics for the month of April. Required: Compute the sales-price and sales-volume variances forApril. Static Budget Actual Units sold Sales revenue Variable...
-
You are working for a company that is interested in mapping geological formations in Earth's crust by examining variations in the magnitude of the magnetic field at Earth's surface. Your assignment...
-
Western Bank & Trust purchased land and a building for the lump sum of $3,000,000. To get the maximum tax deduction, Western allocated 90% of the purchase price to the building and only 10% to the...
-
why is there an OSI and TCP / IP model?
-
Petes Powerful Pills ( PPP) has branched out and is now promoting a vaccine which is supposed to prevent statisticitis, a nasty disease afflicting students at the local Evermore University. They are...
-
During your audit of the cash and investment accounts, you notice several adjusting entries in the accounts at year-end. a. Identify several questions that you should ask management regarding the...
-
Richard Schrushy, the CEO of HealthSouth, denied knowing about the fraud at his company. He says that executives working under him kept knowledge of the fraud from him. a. Is this a possible...
-
Assume that Volleyball Pro Equipment had $900,000 of sales during each of three consecutive years, and it purchased merchandise costing $500,000 during each of the years. It also maintained a...
-
Assume that a certain line of insurance has incurred losses and loss-adjustment expenses of USD 800,000 and earned premiums of USD 1mn. The expected loss ratio is 70%. What is the premium adjustment...
-
How would a defender of capitalism respond to the charge that capitalism results in large inequalities in income?
-
How the court decision in the Nike vs Eugene McCarthy contract case impacts legal and ethical compliance in a business environment?
-
When faced with a moral decision, employees should follow the two-step process of identifying the relevant obligations, effects, and ideals, and then try to decide where the emphasis should lie among...
-
How does the Deferral method handle an unrestricted contribution received for the current year?
-
Describe the business of banking. How do banks generate revenue? What is their biggest liability?
-
1. Using the information from Problem 16-4B, prepare a statement of cash flows for Lim Garden Supplies Inc. using the direct method of presenting cash flows from operating activities. 2. How does Lim...
-
Prepare the income statement of Boardwalk Web Design for the year ended December 31, 2025. Boardwalk Web Design has just completed operations for the year ended December 31, 2025. This is the third...
-
Roger Royce, CPA, has encountered a situation that he thinks may pose a threat to his independence with respect to Watson, Inc., an audit client. The situation is not addressed by an independence...
-
Jenko Corp. is an audit client of the Phoenix office of Williams and Co., CPAs. Williams and Co. has offices in Arizona, including ones in Phoenix, Tucson, and Tombstone. For purposes of...
-
Tracy Smith, CPA, is in charge of the audit of Olympic Fashions, Inc. seven young members of the public accounting firms professional staff are working with Smith on this engagement, and several of...
-
Osprey Co. manufactures widgets. Osprey estimated they would produce 15,000 widgets in 2019, with 0.80 direct labor hours allowed per widget (meaning Osprey estimated they would use 12,000 direct...
-
A non-resident alien received the following investment income during the current year: $5,000 of dividend income from ownership of stock in a U.S. corporation, $10,000 interest from a U.S. bank,...
-
Guy Corporation has P100,000 collectibles from Jinju who became insolvent with the P60,000 assets and P200,000 liabilities of which 50% is an income tax liability. How much is the deductible bad...
Study smarter with the SolutionInn App