Deloitte's unqualified audit opinion on Diamond for fiscal 2010? If not, suggest an alternative type of...

 

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Deloitte's unqualified audit opinion on Diamond for fiscal 2010? If not, suggest an alternative type of audit opinion that would be appropriate. Provide rationale for your suggestion and include a suggested wording for the audit opinion you consider appropriate. Requirement (a) Identify at least two material weaknesses in Diamond's internal control system in fiscal 2011. (b) What changes would you suggest to the auditor's report on internal controls to allude to the material weaknesses you have identified? (c) What are some remedial steps that Diamond's management took to address the material weaknesses in its internal controls? (Hint: Refer to Deloitte's report on internal control over financial reporting on the restated financial statements of Diamond for fiscal 2011, which can be accessed at: data/1320947/000119312512470647/d438164d10ka.htm) http://www.sec.gov/Archives/edgar/data/1320947/ Requirement (a) Management override of controls presents a significant audit risk. Provide some examples of procedures that auditors must perform to address the risk of management fraud related to overrides of controls. Provide some examples where management override of controls occurred in Diamond's fraud. manuscript (b) Examine the audit fee data given in the case. What is the reason for the almost ten- fold increase in Deloitte's audit fees from fiscal 2011 to fiscal 2012? (c) In your opinion, was it appropriate for Diamond's Board of Directors to ask Deloitte to assist the Audit Committee of the Board in its investigation of possible fraud committed by Diamond's management? Why? Requirement (a) Based on the data provided in the case, do you think that Diamond's senior management acted with scienter in fiscal 2010 and 2011? Explain. Deloitte's unqualified audit opinion on Diamond for fiscal 2010? If not, suggest an alternative type of audit opinion that would be appropriate. Provide rationale for your suggestion and include a suggested wording for the audit opinion you consider appropriate. Requirement (a) Identify at least two material weaknesses in Diamond's internal control system in fiscal 2011. (b) What changes would you suggest to the auditor's report on internal controls to allude to the material weaknesses you have identified? (c) What are some remedial steps that Diamond's management took to address the material weaknesses in its internal controls? (Hint: Refer to Deloitte's report on internal control over financial reporting on the restated financial statements of Diamond for fiscal 2011, which can be accessed at: data/1320947/000119312512470647/d438164d10ka.htm) http://www.sec.gov/Archives/edgar/data/1320947/ Requirement (a) Management override of controls presents a significant audit risk. Provide some examples of procedures that auditors must perform to address the risk of management fraud related to overrides of controls. Provide some examples where management override of controls occurred in Diamond's fraud. manuscript (b) Examine the audit fee data given in the case. What is the reason for the almost ten- fold increase in Deloitte's audit fees from fiscal 2011 to fiscal 2012? (c) In your opinion, was it appropriate for Diamond's Board of Directors to ask Deloitte to assist the Audit Committee of the Board in its investigation of possible fraud committed by Diamond's management? Why? Requirement (a) Based on the data provided in the case, do you think that Diamond's senior management acted with scienter in fiscal 2010 and 2011? Explain.

Answer rating: 100% (QA)

a Identifying material weaknesses in Diamonds internal control system in fiscal 2011 To identify material weaknesses in an internal control system a t... View the full answer