deter another Madoff fraud. -) Investors, the auditor, feeder funds, the Financial Industry Regulatory Authority, Inc. (FINRA), SEC inspectors-all should have exhibited professional skepticism. What do you understand by the phrase "professional skepticism"? Describe it in detail. Why did the SEC regulatory controls

deter another Madoff fraud. -) Investors, the auditor, feeder funds, the Financial Industry Regulatory Authority, Inc. (FINRA), SEC inspectors-all should have exhibited professional skepticism. What do you understand by the phrase "professional skepticism"? Describe it in detail. Why did the SEC regulatory controls

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter14: Completing A Quality Audit

Section: Chapter Questions

Problem 16RQSC

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Similar questions

Who are the professional organizations who are in charge of fraud auditing? Birefly elucidates.
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Describe the Fraud Triangle. Fully explain the thought process behind each of the 3 sides of the Fraud Triangle and how a weak internal control system could result in fraudulent financial reporting. Your discussion must include an example scenario illustrating the weak internal controls. Include a biblical application in your analyses.
1. Identify specific fraud risk factors present during PwC’s audits of the Lipper hedge funds. Explain how PwC should have responded to the fraud risk factors that you identified.
What is the importance of Forensic Accounting and Fraud Detection? Please give as much information as possible. Thanks!
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Question No. 1. What are fraud audits and why have they become more common?
If one of the three elements of the fraud triangle is not present, can fraud still be perpetrated? Explain. Identify factors (red flags) that would be strong indicators of opportunities to commit fraud. Is the ability to rationalize the fraud an important aspect to consider when analyzing a potentially fraudulent situation? What are some of the common rationalizations used by fraud perpetrators? Define and illustrate kiting. What controls should the client institute to prevent it?
If you had the opportunity to interview Rita Crundwell, what would you ask her and why? 2. Should the external auditors have been able to identify the false invoices? 3. What was the most shocking piece of evidence you learned about the Crundwell case?
In writing your response, the following points must be addressed fully:a) Determine the type of fraud committed and describe with examples thesymptoms of fraud that are evident in the case study.b) As discussed in units 1 to 4, all frauds involve key elements. Identify anddescribe, using examples, the elements of the Purell’s magazine fraud.c) What role did trust play in allowing this fraudulent scheme to transpire?What elements contributed to this trust? Outline two positive and twonegative consequences that this might pose to the company in future fraudprevention.d) Describe Purell Magazine and Publishing House fraud preventionprogramme and identify any improvements that might be necessary toprevent this type of fraud or at least discover it sooner.
6 Who has the responsibility to carry out the Fraud Risk Assessment (FRA)? And what skills should an individual/team have in conducting FRA?
Read the following research paper and answer this question: How can audit seniors prevent material misstatement of revenue in future?( Hammersley, J.S., Johnstone, K. M and Kadous, K., 2011. How do audit seniors respond to heightened fraud risk? Auditing: A Journal of Practice & Theory, 30(3), pp .81-101.)