Case 4.7 David Quinn: Tax Accountant
Case # 4: 4.7 David Quinn, Tax Accountant
Auditing problems:
1. The auditors are not comply with integrity standard.
2. The auditors allow client that claim wrong write-offs.
3. The auditors violate client confidentiality.
4. The auditors breach some ethics issues.
All the auditor should comply with the following audit standards.
1. AS 8.04 Audit Risk
In an audit of financial statements, audit risk is the risk that the auditor expresses an inappropriate audit opinion when the financial statements are materially misstated. The financial statements are not presented fairly in conformity with the applicable financial reporting framework. In this case, the auditor allowed his client to write off the cost of the client’s wedding as an entertainment expense. The auditor expresses an inappropriate audit opinion and increase the audit risk.
2. AICPA code 0.300.040.03-04 Integrity
Integrity requires an audit to be honest and candid within the constraints of client confidentiality. Integrity can accommodate the inadvertent error and honest difference of opinion, but it cannot accommodate deceit or subordination of principle. …show more content…
Any information obtained from the client that is not available to the public. For example, they can not discuss confidential client information with the others. Discussion in the public place is inappropriate, such as restaurant, elevator, cell phone etc. because the client’s information might be heard by a third party. A member should be alert to the possibility of inadvertent disclosure. In this case, David and his colleagues’ behaviors appears to violate the client confidentiality standard. David clearly disclosed the client’s identity, financial situation and engagement. No one can share e other’s confidentiality information in the public to another
Auditing problems:
1. The auditors are not comply with integrity standard.
2. The auditors allow client that claim wrong write-offs.
3. The auditors violate client confidentiality.
4. The auditors breach some ethics issues.
All the auditor should comply with the following audit standards.
1. AS 8.04 Audit Risk
In an audit of financial statements, audit risk is the risk that the auditor expresses an inappropriate audit opinion when the financial statements are materially misstated. The financial statements are not presented fairly in conformity with the applicable financial reporting framework. In this case, the auditor allowed his client to write off the cost of the client’s wedding as an entertainment expense. The auditor expresses an inappropriate audit opinion and increase the audit risk.
2. AICPA code 0.300.040.03-04 Integrity
Integrity requires an audit to be honest and candid within the constraints of client confidentiality. Integrity can accommodate the inadvertent error and honest difference of opinion, but it cannot accommodate deceit or subordination of principle. …show more content…
Any information obtained from the client that is not available to the public. For example, they can not discuss confidential client information with the others. Discussion in the public place is inappropriate, such as restaurant, elevator, cell phone etc. because the client’s information might be heard by a third party. A member should be alert to the possibility of inadvertent disclosure. In this case, David and his colleagues’ behaviors appears to violate the client confidentiality standard. David clearly disclosed the client’s identity, financial situation and engagement. No one can share e other’s confidentiality information in the public to another