Auditing And Assurance Services
17th Edition
ISBN: 9780134897431
Author: ARENS, Alvin A.
Publisher: PEARSON
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Question
Chapter 22, Problem 9RQ
To determine
Determine the meaning of the statement “the corporate charter and the bylaws of a company are legal documents; therefore they should not be examined by the auditors. If the auditor wants information about these documents, an attorney should be consulted.”
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Evaluate the following statement: “The corporate charter and the bylaws of a company are legal documents; therefore, they should not be examined by the auditors. If the auditor wants information about these documents, an attorney should be consulted.”
Many companies request that their auditors provide them with other services, such as tax or consultancy, as well as the external audit. Discuss the arguments for and against auditors providing non-audit services.
Give an explanation of the legal foundation for suing a CPA. What defenses does the auditor have to counter such accusations? What is the relationship between these defenses and adherence to the accounting profession's ethical standards?
Chapter 22 Solutions
Auditing And Assurance Services
Ch. 22 - List four examples of interest-bearing liability...Ch. 22 - Prob. 2RQCh. 22 - Prob. 3RQCh. 22 - Prob. 4RQCh. 22 - Prob. 5RQCh. 22 - Distinguish between (a) tests of controls and...Ch. 22 - Prob. 7RQCh. 22 - Prob. 8RQCh. 22 - Prob. 9RQCh. 22 - Prob. 10RQ
Ch. 22 - Prob. 11RQCh. 22 - Prob. 12RQCh. 22 - Prob. 13RQCh. 22 - Prob. 14RQCh. 22 - Prob. 15RQCh. 22 - Explain the relationship between the audit of...Ch. 22 - Prob. 17.1MCQCh. 22 - Prob. 17.2MCQCh. 22 - Prob. 17.3MCQCh. 22 - Prob. 18.1MCQCh. 22 - Prob. 18.2MCQCh. 22 - Prob. 18.3MCQCh. 22 - Prob. 19.1MCQCh. 22 - Prob. 19.2MCQCh. 22 - Prob. 19.3MCQCh. 22 - Prob. 20DQPCh. 22 - Prob. 21DQPCh. 22 - Prob. 22DQPCh. 22 - Prob. 23DQPCh. 22 - Prob. 24DQPCh. 22 - Prob. 25DQPCh. 22 - Prob. 26DQPCh. 22 - Prob. 27DQPCh. 22 - Prob. 28DQPCh. 22 - Prob. 29DQPCh. 22 - Prob. 30DQP
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Similar questions
- What other restrictions and requirements apply to auditors whenproviding nonaudit services to public companies?arrow_forwardWhat additional constraints and obligations do auditors face when offering nonaudit services to public companies?arrow_forwardChoose the correct.Which of the following is not a way by which the Sarbanes–Oxley Act attempts to ensure auditor independence from an audit client?a. The auditing firm must be appointed by the client’s audit committee.b. Audit fees must be approved by the Public Company Accounting Oversight Board.c. The audit committee must be composed of members of the client’s board of directors who are independent of the management.d. The external auditor cannot also perform financial information system design and implementation work.arrow_forward
- Which of the following is NOT an auditor's responsibility? Obligation to report any breach of the law Obligation to report to members Obligation to report to the bankers of the corporation Signing the audit report is a requirement.arrow_forwardDiscuss 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)arrow_forwardWhich of the following is not a way by which the Sarbanes–Oxley Act attempts to ensure auditor independence from an audit client?a. The auditing firm must be appointed by the client’s audit committee.b. Audit fees must be approved by the Public Company Accounting Oversight Board.c. The audit committee must be composed of members of the client’s board of directors who are independent of the management.d. The external auditor cannot also perform financial information system design and implementation work.arrow_forward
- Describe the action that an auditor should take if an attorney refuses to give information that is within the attorney's authority and may have a direct impact on the financial statements' fair presentation.arrow_forwardDiscuss 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.arrow_forwardAlthough audit reports should provide assurance to investors and creditors that financial information presented is free of material misstatements and in accordance with GAAP, should audit reports be used to solicit investments, credit, or sales in a manner similar to Jim Bakker’s? How can a CPA firm prevent such behavior?arrow_forward
- Which one of the following is NOT a duty of the auditor? Duty to report on any violation of law Duty to report to the members Duty to report to the company’s bankers Duty to sign the audit reportarrow_forwardHow would an auditor communicate known there are violations of the law and the auditor's responsibilities according to the law?arrow_forwardDescribe the action that an auditor should take if an attorneyrefuses to provide information that is within the attorney’s jurisdiction and may directlyaffect the fair presentation of the financial statements.arrow_forward
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