New Semester
Started
Get
50% OFF
Study Help!
--h --m --s
Claim Now
Question Answers
Textbooks
Find textbooks, questions and answers
Oops, something went wrong!
Change your search query and then try again
S
Books
FREE
Study Help
Expert Questions
Accounting
General Management
Mathematics
Finance
Organizational Behaviour
Law
Physics
Operating System
Management Leadership
Sociology
Programming
Marketing
Database
Computer Network
Economics
Textbooks Solutions
Accounting
Managerial Accounting
Management Leadership
Cost Accounting
Statistics
Business Law
Corporate Finance
Finance
Economics
Auditing
Tutors
Online Tutors
Find a Tutor
Hire a Tutor
Become a Tutor
AI Tutor
AI Study Planner
NEW
Sell Books
Search
Search
Sign In
Register
study help
business
auditing
Auditing and Assurance Services Understanding the Integrated Audit 1st edition Karen L. Hooks - Solutions
Ellison Courtley is a staff accountant for Bronson, Burkes & Hunt, CPAs. During his second year on the audit staff, Ellison becomes quite frustrated with the number of overtime hours required for his job. He dislikes the firm’s policy of rewarding additional vacation time in lieu of overtime
The situations that follow pertain to Rule 101 of the AICPA Code of Professional Conduct as it relates to family relationships. Indicate whether each situation violates the Code and which provisions apply.a. A staff accountant’s mother retired from her position as Controller for an audit client.
Each of the scenarios that follow portrays a possible violation of the AICPA Code of Professional Conduct. Complete the table by checking Yes for any violations of the Code or No if the scenario does not represent a violation.
Birk Dorren, is a partner with the firm Shelby, Dorren & Ruppe, CPAs. Birk serves as the audit partner on the integrated audit engagement for Pundley Fasteners, Inc., a public company.One week after issuing unqualified opinions on the fairness of Pundley’s financial statements and
John Thomas is a certified public accountant. He is the audit partner responsible for auditing the financial statements of Core Technology’s U.S. operations for the fiscal year ended December 31, 2010. During all times relevant to this case, Thomas was also a partner with Weiss and Associates,
Joseph Newport, CPA, is the engagement partner for the audit of Yonker Plumbing Supplies, Inc. He works for the firm Harrison and Ford, LLP. Harrison’s own audit program for this type of engagement includes in the audit work papers, procedures for testing revenue, including, but not limited to,
On the AICPA website, under Professional Resources, find the Code of Professional Conduct. How is the Code organized on the website?
On the AICPA Web site, select Professional Resources, then Professional Ethics/Code of Conduct, and click on Professional Ethics. Click on Resources and Tools. Find the Plain English Guide to Independence. What is the purpose of this document? Does it explain differences between the AICPA, PCAOB,
Go to the Web site of the Institute of Internal auditors (www.theiia.org). Find the IIA code of ethics. Briefly compare the IIA code to the AICPA Code.
How is a doctor’s professional relationship with a client different from an auditor’s?
What are the three levels of moral development?
Compare and contrast an ethic of rights and an ethic of care.
What personal characteristics are usually associated with a person who is called a professional?
Describe the view of auditors as professionals who have a contract with society.
What are the steps in a decision model that is to be used for making decisions that have ethical components and outcomes?
What is moral intensity?
Does using an ethical decision framework guarantee a moral decision outcome? Would the moral decision outcome be the same for everyone?
What is the difference between immediate family and close relative?
What is the difference between being in a key position and being in a position to influence an engagement?
How can the definition of covered member apply to both an individual and a firm?
Why is the phrase “holding out” important?
Under Rule 203, is it ever acceptable for financial statements to NOT conform to GAAP?
Summarize Rule 505 regarding the form of organization under which a CPA can practice, and the limitations on names for such an organization.
What are the exceptions to Rule 301 that permit a CPA to disclose confidential client information without the client’s permission?
What is a contingent fee? How do fees fixed by courts or other public authorities fit into Rule 302?
Can a CPA ever receive a commission or referral fee?
What is the difference between independence in fact and independence in appearance?
In what situations of financial interest is materiality important?
What does Section 206 of SOX say about the independence of an audit firm when a member of the audit team goes to work for a client?
What is the emphasis of the most recent revision of the SEC rules regarding independence?
What services does the SEC prohibit for a CPA that also performs a company’s audit? How can these services be grouped consistently with the SEC’s personal independence rules?
What are Quality Control Standards? What authoritative sources require quality control standards?
What are practice monitoring programs?
Identify the elements of quality control.
Explain the PCAOB registration and practice inspection requirements.
Why are auditors not the parties typically charged with fraud in cases of fraudulent financial statements? What will cause civil allegations against an auditor to be constructive fraud and actual fraud? In what ways do the court processes and outcomes of a civil allegation of fraud differ from a
When an audit client’s financial statements are found to be materially misstated due to fraud and the auditor failed to discover the misstatement, what are the various potential consequences for the auditor? What are the likely allegations and charges and by whom? How does the capital structure
Is it important whether an auditor is charged under common law or statutory law, and why or why not? How do the laws differ? What are the reasons why a plaintiff might prefer to bring a case in state or federal court?
The “foreseeable third party” doctrine of standing has yet to be used as a viable requirement of standing in a case against auditors. Why may such a doctrine be catastrophic to auditors? Why may such a doctrine be catastrophic to society as a whole if all auditors believe their business risks
Discuss how the theory of proportionate liability enacted by the Private Securities Litigation Reform Act of 1995 (PSLRA) can actually protect auditors. Compare proportionate liability with jointly and severally liable.
Discuss how Section 303 of the Sarbanes-Oxley Act of 2002 can actually serve to limit an auditor’s liability. How else does the Sarbanes-Oxley Act affect the legal environment of auditors? Do you think the provisions of SOX would have prevented recent corporate scandals like Enron?
An important component of the United States legal system is the right to a trial by a jury of one’s peers. Does a typical jury have the ability to understand complex accounting issues? Should fraud cases be decided by individuals with some threshold level of accounting knowledge? Discuss how
Briefly explain why the severity of the wrongdoing alleged against the auditor and the closeness of the relationship between the plaintiff and auditor have an impact on the likelihood that the auditor will have to pay damages in a legal case.
If a plaintiff purchased securities and initiates a civil liability suit against a CPA, what must be proven under the 1933 and 1934 Securities Acts for the plaintiff to prevail? Place yes or no in the space provided for each of the following.
Fill in the blank with the answer. Each answer in the list may be used more than once or not at all.a. Separate and proportionateb. Racketeer Influenced and CorruptOrganization Act (RICO)c. Foreign Corrupt Practices Actd. Fraude. Negligencef. Reasonable professional careg. Gross negligenceh.
Jean and Cheramy, LLC, a firm of CPAs, has been the auditor of Moose Pix for five years. Moose Pix is a non-public corporation that coordinates wildlife sightseeing tours in the area around Jackson, Wyoming. Moose Pix is well known for leading amateur photographers into areas where they are likely
Refer to the case facts presented in number 4-32.a. What defenses are available to an auditor when charged with negligence under common law?b. Which defense is the auditor most likely to use in this case? Explain.
Kaufman & Kaufman conducted an audit of Brady MVP Co., a publicly held corporation, in which it conducted its audit wholly in accordance with the professional requirements of the PCAOB. However, during the year in question, the management of Brady MVP Co. committed fraud, and the company’s shares
Assume the same facts are present as in paragraph 1 of the Kaufman & Kaufman case presented in Problem. Except, instead of seeking negligence, plaintiffs are seeking a judgment for Gross Negligence. What must the plaintiffs prove in addition to the requirements of Ordinary Negligence to pursue a
Mustian Properties, Inc. recently filed bankruptcy, as it is unable to make payments on several vacant properties in its condominium complexes near Las Vegas and Lake Tahoe.Last year, Mustian borrowed $3 million from Field Centre Bank under the terms of a 36-month note payable. The loan application
Paxon Laboratories filed an initial public offering of equity securities in order to raise capital to carry out its expansion plan. On September 30, 2009, it sold $50 million of its $2 par common stock in accordance with the registration statement requirements of the Securities Act of 1933, which
Bruer Sportswear, Inc. is a small privately-owned distributor of men’s athletic apparel located in Portland, Oregon. The company was founded by Drake Bruer, who serves as the company’s President and Chief Executive Officer. He is actively involved in the day-to-day operations of the business
Aves Manufacturing Solutions is a public company that produces specialty automated manufacturing equipment used in the automotive industry. The company is pursuing both debt and equity financing in order to raise funds for planned plant expansion. The company’s 2009 financial statements are
Trace the outcome of the BDO Seidman appeal in the E.S. Bankest case and the bankruptcy court action against BDO Seidman. What have been the financial impacts to date on BDO Seidman?
Rent the movie The Firm. At the conclusion, what evidence is used against the law firm and what statute applies? What does this statute have in common with legal actions that can be brought against accountants?
What are all the possible allegations and charges that might be brought against an auditor for a single case?
Research the following cases. Determine the business situations and facts of the involved companies causing them to become involved in litigation. Was the legal action civil or criminal? Who was charged? What were the outcomes? Were there any appeals? What were the outcomes of the appeals?
Why does audit risk create business risk for an auditor, and how does the legal environment of business affect the auditor’s business risk?
What is meant by the term standing as it refers to a plaintiff and why is standing important?
What are the various categories of standing of plaintiffs in actions against auditors? What characteristics cause a plaintiff to have each type of standing?
What reasons have been given for expanding auditor liability for negligence to foreseen users?
What is arbitration?
What are the steps in a legal action up to and including the trial? What happens during each step?
What are the differences between a civil and criminal case?
What circumstances lead to a negligence cause of action against an auditor?
What defenses can be used?
How do your answers to 3, 4, and 5 change for a gross negligence cause of action?
What are the main legal theories of liability, and how do they differ?
What is the reasonable man or prudent person standard?
What defense is appropriate?
How do your answers for 1, 2, and 3 change for a constructive fraud cause of action?
What unique remedy may be requested in a breach of contract case?
How does the burden of proof differ in a cause of action brought under the 1933 Act from one brought under a common law negligence claim?
What is the most well-known section of the 1934 At relating to charges brought against accountants? For what type of behavior does an auditor have liability under this section of the 1934 Act?
How is SEC Rule 2(e) associated with Arthur Andersen going out of business?
What aspect of SOX protects auditors, and how?
What happens to client companies that are not desired as clients by the CPA firms that are very concerned about client reputation? These might be companies with known management integrity issues or fee disputes with prior auditors. Will these companies still be able to get audits? From whom? What
Why does a recent or upcoming IPO create more risk for the auditor? Which audit firms seem best positioned to accept the risk? Which audit firms likely have the greatest expertise with that type of client? What would be the ultimate outcome if the most qualified audit firms turn down companies with
Why would an auditor be concerned about a potential client with an overworked accounting staff? With a potential client that has had multiple turn-over of people in top accounting positions?
What circumstances might motivate an audit firm to hire an investigative agency to research a potential client?
What is the purpose of an engagement letter? Is the engagement letter considered a binding contract between both parties? If a CPA firm works over the explicitly specified engagement hours provided for in the engagement letter, do you think the firm can bill the client and collect for those hours?
Assuming no independence issues, if you are a partner at a CPA firm and your firm is engaged to audit your best friend’s company, should you take on the engagement on a verbal contract agreement? Why or why not? What influences your decision?
Your firm has been the auditor of a company for the last 15 years. In those 15 years, your firm has never identified any significant red flags regarding the company. By all methods of judging, your client is a dream client. Considering the professional relationship your firm has with the company,
What is an RFP? Who issues an RFP? What information can the auditor expect to obtain from a company’s RFP?
Global Technologies Corporation (GTC) is a large, international electronics company that’s headquartered and traded in the United States. GTC was founded in 1976, went public in 1983, and has had no known accounting “issues” since it went public. GTC has diversified operations on 5 continents
S&W LLP is a mid-size, national audit firm with 55 offices in 40 states around the U.S. S&W is also a member of an international network of firms that share technologies and some services. S&W is known to specialize in the technology and healthcare sectors, and audits primarily nonpublic and small
Instead of a role on the Audit Committee, assume the role of a partner in a public accounting firm that is considering whether or not to propose on a company that recently issues a RFP.Required:a. List the steps the auditing firm should take when deciding whether or not to propose to a potential
Grand slam Co. operates the largest sports and entertainment business in the United States. Grand slam recently became one of the largest U.S. nonpublic corporations, was named number two on Best Place to Work list, and was recently listed on the Most Ethical Company list. Grand slams accounting
Adrianna is an up-and-coming audit partner who specializes in health care audits at Sterling Cooper LLP, a rapidly growing mid-size public accounting firm. Adrianna’s compensation is based partially on her client work and partially on her ability to bring new audit clients to the firm. In fact,
Williams 400 Company, a publicly traded company, recently issued an RFP for quarterly reviews and the annual audit. The company is generally perceived to be a desirable client and expected to be an extremely profitable for whichever firm lands the engagement. Shapiro, LLP, a public accounting firm,
Ellis & Jarrick, CPAs, received a RFP from the audit committee of the board of directors of Lunar Mills, Inc. to perform an audit of the company’s financial statements for the year ended December 31, 2009. In connection with its client acceptance procedures, Ellis & Jarrick requested
Custiss & Branch, CPAs, is considering whether to propose to perform the audit of BF Hemings Enterprises. The company is a large manufacturer of plumbing materials and hardware whose products are sold worldwide. Hemings is headquartered in the United States and all of its manufacturing and
Camer & Associates, CPAs, received a RPF from the audit committee of Haspur Company’s board of directors. Haspur is a mid-sized public company that fired its prior auditors due to scheduling issues. Haspur explained that the prior auditors did not handle many public company clients and were
Sun Element Enterprises (SEE) is a manufacturer and retailer of patio furniture and outdoor accessories that sells its products throughout the Atlanta metropolitan area. The company operates one manufacturing facility and four retail outlets. Management of SEE invited Cames & Littler, CPAs, to
Assume the role of a member of the Audit Committee of the board of directors of a mid-size, publicly traded company that has decided to ask for auditor proposals for the upcoming year’s integrated audit.Required: List the steps the company should take when soliciting proposals for next
Distinguish between client acceptance and client continuance.
What performance indicators are found in a 10K?
Why would firms review a potential client’s financial disclosures for information about management’s choices on accounting principles?
Why might an auditor be concerned if all of the company’s management authority is centered in one or two individuals?
What is financial statement restatement? Why does the auditor investigate whether a company has restated its financial statements when addressing client acceptance?
Showing 6500 - 6600
of 10291
First
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
Last
Step by Step Answers
Get 50% OFF
Claim Now
