What requirements exist when the auditors use the work of client personnel as a part of the evidence obtained for an audit of internal control? In which areas of the audit would one expect this to be most likely to occur?
Answer to relevant QuestionsProvide an example of a situation in which the performance of substantive procedures for the financial statement audit might affect the internal control audit.The CPA firm of Webster, Warren, & Webb LLP issued an adverse opinion on the internal control of Alexandria Financial, a public company, due to a material weakness. The weakness involved the lack of sufficient accounting ...Identify management’s four overall responsibilities with respect to internal control over financial reporting that arise due to the Securities and Exchange Commission’s implementation of the Sarbanes-Oxley Act of 2002.Comment on the following: “All controls should be tested either prior to or on the ‘as of’ date.”You have been asked by Ambassador Hardware Co., a small nonpublic company, to submit a proposal for the audit of the company. After performing an investigation of the company, including its management and accounting system, ...
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