Audit Evidence - Essay

Managerial Auditing Journal
Emerald Article: Audit evidence: the US standards and landmark cases Rocco R. Vanasco, Clifford R. Skousen, Richard L. Jenson

Article information:
To cite this document: Rocco R. Vanasco, Clifford R. Skousen, Richard L. Jenson, (2001),"Audit evidence: the US standards and landmark cases", Managerial Auditing Journal, Vol. 16 Iss: 4 pp. 207 - 214 Permanent link to this document: http://dx.doi.org/10.1108/02686900110389151 Downloaded on: 30-04-2012 References: This document contains references to 45 other documents To copy this document: [e-mail] This document has been downloaded 2787 times.

Access to this document was granted through an Emerald subscription provided by UNIVERSITI MALAYSIA SABAH For Authors: If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service. Information about how to choose which publication to write for and submission guidelines are available for all. Additional help for authors is available for Emerald subscribers. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.com With over forty years ' experience, Emerald Group Publishing is a leading independent publisher of global research with impact in business, society, public policy and education. In total, Emerald publishes over 275 journals and more than 130 book series, as well as an extensive range of online products and services. Emerald is both COUNTER 3 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation.
*Related content and download information correct at time of download.

Audit evidence: the US standards and landmark cases

Rocco R. Vanasco College of Management and Business, Center for Internal Auditing Studies, National-Louis University, Chicago, Illinois, USA Clifford R. Skousen

References: Conclusion There are many dimensions of auditing that relate to the theories of science, economics, law, philosophy, and mathematics. An audit might be perceived as a scientific investigation where the tenets of behavior are well-established, and the evaluation of quality of performance can be derived with adequate reliability and validity. The planning for an audit from the perspective of a scientific method include: . a specification of the evidence needed to express an opinion; . specification of the procedures for the performance of substantive tests; and . careful communication to the audit staff of what needs to be done (Oliverio, 1984). Fraud and bankruptcy often are found in lawsuits against auditors frequently due to the lack of evidence that the auditors should have obtained to support their opinions. The auditor 's detection and disclosure responsibilities in these areas are the focus of the Private Securities Litigation Act of 1995. The act reaffirms the auditor 's responsibilities regarding SAS No. 54 Illegal American Accounting Association (AAA) (1993), A Statement of Basic Auditing Concepts, AAA Committee on Basic Auditing Concepts, AAA, Sarasota, FL. AICPA (1974), Generally Accepted Auditing Standards, Statement on Auditing Standards (SAS) No. 1, AICPA, New York, NY. AICPA (1977), Client Representations, SAS No. 19, AICPA, New York, NY. AICPA (1980), Evidential Matter, SAS No. 31, AICPA, New York, NY. AICPA (1981), Audit Sampling, SAS No. 39, AICPA, New York, NY. AICPA (1983), Audit Risk and Materiality in Considering an Audit, SAS No. 47: AICPA, New York, NY. AICPA (1988a), The Auditor 's Responsibility to Detect and Report Errors and Irregularities, SAS No. 53, AICPA, New York, NY. AICPA (1988b), Illegal Acts by Clients, SAS No. 54: AICPA, New York, NY. AICPA (1988c), Consideration of the Internal Control Structure in a Financial Statement Audit, SAS No. 55, AICPA, New York, NY. AICPA (1988d), Analytical Procedures, SAS No. 56, AICPA, New York, NY. AICPA (1988e), Auditing Accounting Estimates, SAS No. 57, AICPA, New York, NY. AICPA (1992), SAS No. 67, The Confirmation Process, AICPA, New York, NY. [ 213 ] Rocco R. Vanasco, Clifford R. Skousen and Richard L. Jenson Audit evidence: the US standards and landmark cases Managerial Auditing Journal 16/4 [2001] 207±214 AICPA (1993), In the Public Interest: Issues Confronting the Accounting Profession, AICPA, New York, NY. AICPA (1994), Using the Work of A Specialist ' ', SAS No. 73, AICPA, New York, NY. AICPA (1996), Amendment to Statement on Auditing Standards No. 31, Evidential Matter, SAS No. 80, AICPA, New York, NY. AICPA (1997), Consideration of Fraud in a Financial Statement Audit ' ', SAS No. 82, AICPA, New York, NY. Alderman, C.W. and Tabor, R.M. (1989), ``The case for risk-driven results ' ', Journal of Accountancy, Vol. 167 No. 3, pp. 55-61. American Institute of Accountants (AIA) (1936), Examination of Financial Statements by Independent Public Accountants, AIA, New York, NY. Bentham, J. (1827), Rationale of Judicial Evidence (reprinted by Hunt and Clarke, London, 1984). Bonner, S.E., Palmrose, Z.V. and Young, S.M. (1998), ``Fraud types and auditor litigation: an analysis of the SEC Accounting and Auditing Enforcement Release ' ', The Accounting Review, Vol. 73 No. 4, pp. 503-32. Carmichael, D.R. (1991), ``Pitfalls on the confirmation process ' ', The CPA Journal, Vol. 61 No.6, pp. 54-55. Committee on Auditing Procedures (CAP) (1939), Extension of Auditing Procedures, CAP Statements on Auditing Procedures (SAP), No. 1, CAP. Financial Accounting Standards Board (FASB) (1975), Analysis of Issues Relating to Criteria for Determining Materiality, FASB, March. Guy, D.R. and Sullivan, J.D. (1988) ``The expectation gap auditing standards ' ', Journal of Accountancy, Vol. 165 No. 4, pp. 36-45. Levine, M. and Fitzsimons, A. (1992), ``SAS 67 finetunes the confirmation process ' ', The CPA Journal, Vol. 62 No. 10, pp. 26-30. Loebbecke, J.M., Eining, M.M. and Willingham, J.J. (1989), ``Auditors ' experience with material irregularities: frequency, nature, and detectability ' ', Auditing: A Journal of Practice & Theory, Vol. 8 No. 2, pp. 1-28. Mautz, R.K. and Sharaf, H.A. (1963), The Philosophy of Auditing, American Accounting Association, Sarasota, FL. Montgomery, R.H. (1940), Auditing Theory and Practice, The Ronald Press Company, New York, NY. Moreland, K.A. (1997), ``SAS 80 amends SAS 31 to address information technology ' ', Ohio CPA Journal, Vol. No. 3, pp. 47-9. Oliverio, M.E. (1984), ``The audit as a scientific investigation ' ', CPA Journal, Vol. 54 No. 10, pp. 56-64. Oliverio, M.E. (1987), ``The SEC and contemporary auditing shortcomings ' ', The CPA Journal, Vol. 57 No. 6, pp. 78-9. Palmrose, Z.V. (1997), ``Who gets sued ' ', Journal of Accountancy, Vol. 183 No. 3, p. 67. Pany, K. and Wheeler, S. (1989), ``Auditing: a comparison of various materiality rules of thumb ' ', CPA Journal, Vol. 89, pp. 62-3. Robertson, J.C. and Louwers, T.J. (1999), Auditing, 9th ed., Irwin and McGraw-Hill, Boston, MA. Sack, R.J. (1987), ``The SEC and the profession: an exercise in balance ' ', Research in Accounting Regulation, Vol. 1 No. 1, pp. 167-73. SEC (1940), In the Matter of McKesson & Robbins, Inc. Summary of findings and conclusions, Accounting Series Release No. 19, File No. 11435, December 5. SEC (1982), Order Instituting Proceedings and Opinions and Order Pursuant to Rule 2(e) of the Commissions 's Rules of Practice in the Matter of Louis Pokat, P.A., P.C. and Louis Pokat, Accounting and Auditing Enforcement Release No. 2, Administrative Proceedings File No. 3-6162, August 18. SEC (1986a), Opinion and Order in the Matter of Michael S. Hope, C.P.A., et al., Accounting and Auditing Enforcement Release No. 109A, Administrative Proceedings File No. 3-6579, August 6. SEC (1986b), Order Instituting Proceedings and Opinion and Order Pursuant to Rule 2(e) of the Commission 's Rules of Practice in the Matter of Robert E. Nilssen and Don F. Oliver, Accounting and Auditing Enforcement Release No. 111. Administrative Proceedings File No. 3-6726, September 11. SEC (1986c), Order Instituting Proceedings and Opinion and Order Pursuant to Rule 2(e) of the Commission 's Rules of Practice in the Matter of Albert Jacobs, CPA, Accounting and Auditing Enforcement Release No. 114, Administrative Proceedings File No. 3-6734, September 24. SEC (1986d), Order Instituting Proceedings and Findings and Order Imposing Remedial Sanctions in the Matter of Huber, Erickson, and Butler, and Chesley H. Erickson, 1050 Beneficial Life Tower, Salt Lake City, Utah 84111, Accounting and Auditing Enforcement Release No. 115, Administrative Proceedings File No. 3-6752, October 10. SEC (1987), Order Instituting Proceedings and Opinions and Order Imposing Remedial Sanctions in the Matter of Stephen Kutz, Accounting and Auditing Enforcement Release No. 127, Administrative Proceedings File No. 3-6782, January 28. SEC (1995), The Private Securities Litigation Act. Smith, S. (1994), ``A matter of evidence ' ', CA Magazine, Vol. 127 No. 8, pp. 57-8. Wallace, W.A. (1995), Auditing, 3rd ed., South Western College Publications, Cincinnati, OH. [ 214 ]