Answer case questions in professional paper format. Ill post pictures of the case to read. 2 pages single spaced.

Case question:

1) Refer to the second general standard (independence) of Generally Accepted Aditing Standards. What is auditor independence, and what is its significance to the audit profession? Based on the case information, do you believe that Anderson violated the second general standard? Why or why not?

2) Refer to the third general standard (due professional care) of Generally Accepted Auditing Standards. Given the reluctance of WorldComs management team to communicate with Anderson, do you believe that Anderson exercised due professional care and professional skepticism in completing the audit? Why or why not?

3) In terms of audit effectiveness and efficiency, briefly explain the difference between substantive analytical procedures and substantive tests of details. Do you believe it was appropriate for Anderson to rely primarily on substantive analytical procedures? Why or why not?

WorldCom: Professional Responsibility Synopsis On june 25, 2002, WorldCom announced that it would be restating it financial statements for 2001 and the first quarter of 2002. On July 21, 2002, WorldCom announced that it had filed for bankruptcy. It was later alleged that WorldCom had engaged in improper accounting that took two major forms: overstatement of revenue by at least $958 milion and understate ment of line costs, its largest category of expenses, by over $7 billion. Several executives pled guilty to charges of fraud and were sentenced to prison terms, including CFO Scott Sullvan (five years) and Controller David Myers (one year and one day). Convicted of fraud in 2005, CEO Bernie Ebbers was the first to recelve his prison sentence: 25 years. Andersen's Relationship with WorldCom The Special Investigative Committee of the Board of Directors (the Speci Committee) found no evidence that WorldCom's independent auditor, Arth Andersen, in fact determined that WorldCom's revenues or line costs we improperly reported. However, it did find that Andersen's failure to dete these improprieties likely stemmed, in part, from a failure to demand suppor ing evidence for certain recorded transactions and some other missed aud opportunities that might have resulted in the detection of these improprieties Andersen served as WorldCom's auditor from at least as far back as 199 through April 2002. In a presentation to the audit committee on May 20, 199 Andersen stated that the firm viewed its relationship with WorldCom as Board of Directons Special Investigative Commite Report, June 9, 2003, p. 25. The committer qualified its analysis as follows: "We had access to only a portion of Andersen's documents, and Andersen personnel refused to speak with us. Therefore, we cannot answer with certainty the question why Andersen failed to detect such a large traud