financial institutions. The auditor will ask for a letter of representation from the company’s attorney. The attorney might bill Apollo Shoes for replying to the query. When the firm concludes the audit‚ the firm may ask for written statements about the financial statements and other issues. The auditor will carry out the audit to know if the records are free of material misstatement. The auditor’s intention is to give reasonable‚ not absolute assurance. The auditor will not provide a thorough
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REPORT � PAGE �10� BEGINNING THE AUDIT REPORT ROSA BERNAL ACC/546 November 01‚ 2014 Thomas House Beginning the Audit Report To: Directors of Apollo Shoes. I would like to thank you for vesting your company and trust in our firm to be your auditors. In this letter an explanation of the general terms and the process of our audit will be defined. This is only an educational purpose letter and is not an agreement. THE AUDIT PROCESS An audit is an examination and review of companies financial
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report or otherwise.” This means that audit documentation is a written documentation that can be used as evidence for the audit conclusion when an auditor reviews the quality of his or her work. It is important for an auditor to retain audit documentation for a specific period of time because audit documentation represents the written evidence that the auditor has completed his/her work in conformity with basic auditing principles. 2. Standing on our opinion‚ Section 103 of SARBOX does not go far
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interest. In addition‚ another company that could have used the funds effectively was deprived of the money. DEFINITION : 1. Spicer and Pegler: "Auditing is such an examination of books of accounts and vouchers of business‚ as will enable the auditors to satisfy himself that the balance sheet is properly drawn up‚ so as to give a true and fair view of the state of affairs of the business and that the profit and loss account gives true and fair view of the profit/loss for the financial period‚
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Professional Conduct or GAAS. Choose the best response. a. What is the meaning of the generally accepted auditing standard that requires the auditor be independent? (1) The auditor must be without bias with respect to the client under audit. (2) The auditor must adopt a critical attitude during the audit. (3) The auditor’s sole obligation is to third parties. (4) The auditor may have a direct ownership interest in the client’s business if it is not material. b. The independent audit is important to readers
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require that an independent CPA firm perform an annual audit because the CPA firm could have an independence issue. The CPA firm in that Lakeside wants to hire is also the auditors for Lakesides main financial bank. The bank is a “main” user of the report put out by Lakesides auditor and in this case would be that banks auditor too. The connection is too close for the CPA firm to pick up this client‚ it would be against the ethically code. 2. Abernethy and Chapman do not have in-depth understanding
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Case 3.1 – A Day in the Life of Brent Dorsey‚ Staff Auditor Professional Pressures 1. What alternatives are available to Brent in regards to the audit of payables? What are the pros and cons of each alternative? - Brent could refuse to work the extra hours – Pros: Brent will improve his strained relationship with his wife and remain morally correct by not reporting dishonest working hours on the engagement. Cons: Brent could cause the engagement to come in over budget‚ which will make John
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Discuss the risks to an audit should the client become aware of the materiality thresholds used on audit engagements by the auditing firm. Auditors cannot insist that their clients accept all proposed audit adjustments even those that have an “immaterial” effect on the given set of financial statements‚ because most clients would refuse to propose audit adjustments. 1. Discuss the general principles or guidelines that dictate when companies are entitled to record revenue and how the
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Questions 1. Identify common inherent risk factors that companies involved in the entertainment industry pose for their independent auditors. List and briefly describe specific audit procedures that would not be used on “typical” audit engagements but would be required for audits of companies involved in live theatrical productions‚ such as Livent. 2. Compare and contrast the responsibilities of an audit partner of a major accounting firm with those of a large public company’s CFO. Which work
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| |TOTAL |100 | | QUESTION ONE (20 MARKS) Bath Pumps Ltd is considering entering into a joint venture with Avon Spas Pty Ltd and has requested its auditors Oliver King and Co to: Prepare a set of financial statements for Bath Pumps Ltd‚ drawn up in accordance with Australian statutory reporting requirements at 31 March 2000 (the company’s
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