The widespread unauthorized account activity at Wells Fargo represented acts of noncompliance with laws and regulations (NOCLAR)
Question:
The widespread unauthorized account activity at Wells Fargo represented acts of noncompliance with laws and regulations (NOCLAR) (i.e., consumer protection laws, banking regulations), which are addressed in the Public Company Accounting Oversight Board's (PCAOB) AS 2405: Illegal Acts by Clients.
a. According to AS 2405, what would KPMG's responsibility have been to plan and perform the audit to detect this type of NOCLAR?
b. What was the KPMG engagement team's responsibility when they became aware of the NOCLAR (i.e., existence of unauthorized account openings)?
c. When the KPMG engagement team became aware of the NOCLAR, to whom were they required to direct follow-up inquiries about it?
d. When KPMG became aware of the NOCLAR at Wells Fargo, to whom was the firm required to communicate this information?
Auditing a risk based approach to conducting a quality audit
ISBN: 978-1133939153
9th edition
Authors: Karla Johnstone, Audrey Gramling, Larry Rittenberg