What impact did the Asian financial crisis in the late 1990s and the corporate scandals in the United States in this century have on the auditing profession? Multiple Choice Reputation for being the watchdogs of financial reporting integrity was reduced. CPAS were no longer allowed to provide external audit services for multinational corporations. O Regulation of the external auditing profession was reduced External auditors were required to sit on the boards of directors of multinational corporations.

What impact did the Asian financial crisis in the late 1990s and the corporate scandals in the United States in this century have on the auditing profession? Multiple Choice Reputation for being the watchdogs of financial reporting integrity was reduced. CPAS were no longer allowed to provide external audit services for multinational corporations. O Regulation of the external auditing profession was reduced External auditors were required to sit on the boards of directors of multinational corporations.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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ABC Corporation (the "Company") incurred heavy losses over the past 10 years resulting in deficit and liquidity problems. The Company considers borrowing from different banks as a way to produce more funds for the company to continue operation and possibly, recover from losses. However, banks are afraid to grant loans to the Company due to recent issues with fraudulent issuance of financial statements by the companies just to obtain loans.In line with the above scenario, what good corporate governance practices may be implemented by the company to increase the confidence of banks (lenders) and avoid the high probability of issuing misstated financial statements by the company? - Have an independent external audit - Require internal audit to conduct examination/audit of Company’s FS - Have the financial statements certified by BIR, Management, and SEC before submission to Banks - Increase integrity and loyalty of BOD
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