The AICPA performs a number of functions that directly bear on independent auditors of nonpublic entities, including promulgation of rules and standards. List four types of standards issued by the AICPA.
Answer to relevant QuestionsWhat kind of organization is the PCAOB, why was it formed, and what does it do?Why is independence such an important standard for auditors? How does auditor independence relate to the agency relationship between owners and managers discussed in Chapter 1?Visit the GAO’s home page (www. gao.gov) and search for a recently completed audit. Prepare a summary of the GAO audit that includes background on the issue and the GAO’s findings and recommendations.Distinguish between illegal acts that are “direct and material” and those that are “material but indirect.” List five circumstances that may indicate that an illegal act has occurred.Multiple Choice:1. Before accepting an audit engagement, a successor auditor should make specific inquiries of the predecessor auditor regarding the predecessor’s a. Awareness of the consistency in the application of ...
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