Applicability of Pronouncements/Legislative Amendments/Circulars etc. for November‚ 2013 – Intermediate (IPC) Examination Paper 1: Accounting A. Pronouncements Accounting Standards 1‚ 2‚ 3‚ 6‚ 7‚ 9‚ 10‚ 13 and 14 are covered in the syllabus. (Text of all applicable Accounting Standards are available in the Appendix I of Volume I of ‘Accounting’ Study Material revised in November‚ 2012.) B. Announcement relevant for November‚ 2013 examination Criteria for Classification of Entities
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Certainly‚ an auditor would be guided by the following auditing standards: 1. AS 8.03 Audit Risk In order to express an appropriate opinion for the financial statements‚ the auditor must plan and perform the audit free of material misstatement. In this case‚ Fazio and his subordinates evaluate the risk of Ligand and posed it as a “greater than normal” degree of engagement risk‚ because Ligand had problem on its sales returns. 2. AU 210.01-03 Training and Proficiency of the Independent Auditor The auditor
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consequences. By not completing the audit steps‚ material misstatements may slip past the auditors. The auditors may then issue an inappropriate audit opinion‚ which can be very costly. Skipping audit steps can lead to inaccurate audit decisions. Material misstatements could go unnoticed by the firm and this also raises a serious ethical issue with serious possible consequences for the auditors involved and the firm which may be a subject of litigation‚ prosecution and liability. Question
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Abstract For auditors‚ failing to detect fraud at their clients is usually accompanied by substantial monetary penalties and/or negative publicity. Thus‚ the profession has re-evaluated its fraud assessment processes and has attempted to find new ways in which material misstatements due to fraud can be identified. The purpose of this study is to determine whether auditors can effectively use nonfinancial measures (NFMs) in their analyses of fraud. Given that auditors can identify NFMs (e.g.‚ facilities
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independent auditors and performed audits for CBI’s financial statements from 1990 through 1993. Ernst and Young failed to investigate the alleged advances and conform to clients facts which may include investigating credit limit and analyzing vendor’s payable accounts. Instead the auditors record in their work papers the client’s feeble explanation for the advances. After investigations from a former CBI accountant and CBI controller‚ Ernst and Young have determined that CBI auditors had failed
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involved To crack it you have to know – Goal of audit and its components and situations Gathering reliable data and evidence Analysis of data Arriving at the conclusions as per regulation/standards Cover your RISKS as an auditor 3 Management to prepare and own responsibility Certified by management Raman Jokhakar‚ CA Tax Audit is an Audit Review what is done by team to get high quality result – Prepared by – Reviewed by – 4 eye approach Remember
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The North Face Inc. 1. The auditor should mainly insist their clients to make the proper adjustments towards material misstatements that have a direct effect on financail statements. In regards to immaterial items‚ the auditor should give the client suggestions on why they recommend for the client to make adjustments. And if the client disagrees with the adjustments they probably have a logical reason for why they don’t want to make the adjustments. And the auditor should respect the clients decision
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various definitions of the gap is that auditors are performing in a manner that is at variance with the beliefs and desires of others who are party to or interested in the audit. The expectation gap may be decomposed into two components: the reasonableness gap and the performance gap. The former appears when people expect more of audit than it can give in practical terms‚ such as detecting all instances of fraud. The latter refers to the gap between what auditors can reasonably be expected to do and
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exceeded the benefits‚ which is found prevalent with the addition of section 404 which required an auditor’s opinion on annual financial reports. In particular‚ the article is focused on the increased fees that are paid to a public companies external auditor as listed in the companies Schedule 14A filings with the Securities and Exchange Commission (SEC) and whether SOX has significantly increased public companies auditing expenses and the difference between these expenses from large and small companies
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not prohibit auditors and client personnel from being “friends”. At what point do such relationships result in violations of the auditor independence rules and guidelines? Provide hypothetical examples to strengthen your answer. As the beginning of the question states: professional standards do not prohibit auditors and client personnel from being “friends.” The point at which a relationships result in violations of the auditor independence rules and guidelines is when the auditor stops being
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