Question: 1. Do you think the AD&A is a good idea? Should it comment on the audit, the companys financial statements, or both? Should it comment

1. Do you think the AD&A is a good idea? Should it comment on the audit, the company’s financial statements, or both? Should it comment on any other information? Explain.

2. The role of Ernst & Young in the Groupon fraud is somewhat unclear. The firm did render unmodified opinions for four years. Do you believe it is possible that an audit firm can render an unmodified opinion and have no responsibility for detecting and reporting a financial fraud? Explain in general and specifically with reference to the fraud at Groupon.

3. a. Why is it Page 337important for a firm such as EY, in a case such as Groupon, to fully understand the nature of risk when a company conducts its business online?

b. What role can internal auditors play in dealing with such risks? 

c. How should external auditors adapt their risk assessment procedures for social media/networking clients?

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