Barbara Wells is a first-year auditor for a large public accounting firm. She was assigned to audit Larson Brothers; the CEO of Larson is her brother. She discussed some of her findings with family members. What is the relevant requirement (s) for the ethical behavior of an auditor? a. Qualified to carry out the scope of service b. Confidential c. All of those listed d. Independence
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Barbara Wells is a first-year auditor for a large public accounting firm. She was assigned to audit Larson Brothers; the CEO of Larson is her brother. She discussed some of her findings with family members. What is the relevant requirement (s) for the ethical behavior of an auditor?
Qualified to carry out the scope of service
Confidential
All of those listed
Independence
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- A. Sandy is a new accounting student in College PTI. She questions the need for and the benefit of an audit, "I am curious to know why we should hire an auditor to audit a company. I thought a company has their own internal auditor. Why should we pay for an extemal auditor services to review our company's financial statements?" Required: a) Explain to Sandy the need for and benefits of an audit of financial statements. b) Discuss TWO (2) differences between external audit and internal audit services.Victoria Lilly is a practicing CPA. A long-time audit client has asked Lilly to design and implement a computer-based accounting information system. The fees associated with this opportunity are very attractive. However, Victoria is concerned that she will not be able to maintain objectivity in future financial statement audits if she was responsible for the design and implementation of the client's accounting system. Furthermore, Victoria knows that professional standards require her to remain independent in "fact" and "appearance" from her auditing clients.1. In regards to financial statement audits, what is the difference between independence in "fact" and independence in "appearance"?2. Why do professional standards require that an auditor remain independent of their audit clients?3. Do you believe that Victoria can accept the engagement to develop the client's accounting system and still remain independent? (Support your answer)Your spouse has just accepted a new job as chief accounting officer at conpany ABC, which is an iesba restricted audit client you are a member of the audit engagement team what are independence inplications
- Sarah O’Hann enjoyed taking her first auditing course as part of her undergraduate accounting program. While at home during her semester break, she and her father discussed the class, and it was clear that he didn’t really understand the nature of the audit process as he asked the following questions. What is the main objective of the audit of an entity’s financial statements? Given the CPA firm is auditing financial statements, why would they need to understand anything about the client’s business? What does the auditor do in an audit other than verify the mathematical accuracy of the numbers in the financial statements? The audit represents the CPA firm’s guarantee about the accuracy of the financial statements, right? Isn’t the auditor’s primary responsibility to detect all kinds of fraud at the client?May chin is an Audit intern at Paul Adam chartered accountants, she isconfused about the responsibilities of the profession. It is difficult for her tounderstand the need for an internal audit when there is an external audit.Explain to her the two types of auditing and what are the differences.Discuss how each of the following could affect independence of mind and independence in appearance, and evaluate the social consequence of prohibiting auditors from doing each one: Owning stock in a client company. Having bookkeeping services for an audit client performed by the same person who does the audit. Having a spouse who is the chief financial officer of a client company. (More detail)
- Which of the following is true?a. Members of an audit engagement team cannot speak with audit client officers about matters outside the scope of the audit while the audit engagement is in progress.b. Audit team members who leave the public accounting firm for employment with auditclients can provide audit efficiencies (next year) because they are very familiar with thefirm’s audit plans.c. Audit team partners who leave the public accounting firm for employment with auditclients can retain variable annuity retirement accounts established in the person’s formerfirm retirement plan.d. The public accounting firm must discuss with the audit client’s board or its audit committee the independence implications of the client’s having hired the audit engagement teammanager as its financial vice president.Which choice is the best example of an independent auditor? A. CPA who has a significant investment in the company being audited. B. A CPA who currently performs payroll services at the company it's auditing C. A CPA who is the best friend of upper financial management at the company being audited. D. None of these are independent auditors.Mr. Salim has appointed as an auditor of Shinas Mart LLC. At the end of the audit, he maintains audit documentation. Identify the purpose of the retention of the audit document, O a. Audit documentation is a part of client policy O b. Management is required to keep them in a safe custody to ensure confidentiality O . Audit documentation is a part of accounting record O d. Audit documentation is the property of the auditor
- The CPA states in his independent auditor’s report that he has examined the* a. Financial statements of the client b. Future viability of the business enterprise c. Compliance of the client with laws and regulations d. Effectiveness of the client’s internal controlsSaleha was recently hired by the accounting firm of Haron & Associates. After two weeks of joining the firm, Saleha was sent to the first-year staff training course.The instructor asked her to prepare answers for the following questions:a. How does evidence relate to assertions and to the audit report?b. What are the characteristics of evidence should an auditor be concerned with when searching for and evaluating evidence? c.List and explain the objective and benefits of financial statement audit.Saleha was recently hired by the accounting firm of Haron & Associates. After two weeks of joining the firm, Saleha was sent to the first-year staff training course.The instructor asked her to prepare answers for the following questions:a. How does evidence relate to assertions and to the audit report?b. What are the characteristics of evidence should an auditor be concerned with when searching for and evaluating evidence? c.List and explain the objective and benefits of financial statement audit.