The following questions concern auditor responsibilities in an audit of financial statements. Choose the best response.
a. The auditor’s responsibility regarding material misstatements caused by fraud is
(1) Less than the auditor’s responsibility regarding material misstatements caused by error.
(2) Greater than the auditor’s responsibility regarding material misstatements caused by error.
(3) The same as the auditor’s responsibility regarding material misstatements caused by error.
(4) Either less than or greater than the auditor’s responsibility regarding material misstatements caused by error, depending on the circumstances.
b. Which of the following would not have a direct impact in determining the sufficiency of evidence gathered during an audit? (1) The cost-benefit relationship of obtaining the audit evidence
(2) The quality of audit evidence obtained
(3) The auditor’s professional judgment
(4) The risk of material misstatement
c. When determining the auditor’s or management’s responsibility for compliance with laws and regulations during an audit, which of the following statements below would be incorrect?
(1) The auditor is not responsible for preventing noncompliance with laws and regulations.
(2) Management and those charged with governance are responsible for ensuring that the company’s operations are conducted in accordance with all applicable laws and regulations.
(3) The auditor provides reasonable assurance that the financial statements are free of material misstatement due to noncompliance with laws and regulations.
(4) The auditor is expected to detect the client’s noncompliance with all laws and regulations affecting transaction cycles under review during the audit itself.
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
The SEC Enforcement Division investigates possible violations of securities laws; recommends SEC action when appropriate, either in a federal court or before an administrative law judge; and negotiates settlements. Litigation Releases, which are descriptions of SEC civil and selected criminal suits in the federal courts, are posted on the SEC website (www.sec.gov/litigation/litreleases.shtml). Find Litigation Release No. 23765, dated March 3, 2017.
Required:
a. What is the nature of the complaint underlying LR No. 23765?
b. How was the fraud underlying the complaint detected?
c. The litigation release does not discuss the role of the auditor. Given the nature of the fraud, do you believe the auditor will be found liable if sued under the 1934 Securities Act?
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
Gordon & Groton, CPAs, were the auditors of Bank & Company, a brokerage firm and member of a national stock exchange. Gordon & Groton audited and reported on the financial statements of Bank, which were filed with the Securities and Exchange Commission. Several of Bank’s customers were swindled by a fraudulent scheme perpetrated by Bank’s president, who owned 90 percent of the voting stock of the company. The swindled customers were invited to invest in a special investment syndicate. The syndicate did not exist; Bank’s president stole the funds and provided fictitious investment statements to the investors. Bank’s president committed the fraud by directing that all correspondence from customers be received directly by him. Gordon & Groton were unaware of this policy regarding customer correspondence, and did not participate in the fraudulent scheme or know of its existence. The customers are suing Gordon & Groton, under the antifraud provisions of Section 10b and Rule 10b-5 of the Securities Exchange Act of 1934, for aiding and abetting the fraudulent scheme of the president. The customers’ suit for fraud is predicated exclusively on the nonfeasance of the auditors in failing to conduct a proper audit, thereby failing to discover the fraudulent scheme.
Required:
Answer the following questions, including your reasoning in reaching your conclusion:
a. Do you believe the auditors were negligent in conducting the audit?
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
This problem requires the use of ACL software, which can be accessed by following the instructions available on the textbook website. Information about downloading and using ACL and the commands used in this problem can also be found on the textbook website. You should read all of the reference material preceding the instructions about “Quick Sort” before locating the appropriate command to answer parts a. through f. For this problem, use the file labeled “Payroll_details” in the “Payroll” subfolder in the ACL_Rockwood project. The suggested command or other source of information needed to solve the problem requirement is included at the end of each question.
Required:
a. Determine the number of payroll transactions in the file. (Read the bottom of the Payroll_detail file screen.)
b. Determine the largest and smallest payroll transaction (gross pay) for all pay periods combined. (Quick Sort)
c. Determine total gross pay for all pay periods. (Total)
d. Determine and print gross pay by pay period. (Summarize)
e. Recalculate net pay for each payroll transaction for all pay periods and compare it to the amount included in the file. (Filter)
f. Determine whether there are any gaps in the pay period sequence. If you were to identify gaps in the sequence, what would be your concern? (Gaps)
g. For parts a. through
f. above, identify the type of audit evidence used for each procedure. How might the auditor use this evidence in testing of payroll expense?
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
In order to expand its operations, Gibson Corp. raised $5 million in a public offering of common stock, and also negotiated a $2 million loan from Citizens National Bank. In connection with this financing, Gibson engaged Horton & Co., CPAs, to audit Gibson’s financial statements. Horton knew that the sole purpose of the audit was so that Gibson would have audited financial statements to provide to Citizens National Bank and the purchasers of the common stock. Although Horton conducted the audit in conformity with its audit program, Horton failed to detect material acts of embezzlement committed by Gibson Corp.’s president. Horton did not detect the embezzlement because of its inadvertent failure to exercise due care in designing the audit program for this engagement. After completing the engagement, Horton issued an unqualified opinion on Barton’s financial statements. The financial statements were relied upon by the purchasers of the common stock in deciding to purchase the shares. In addition, Citizens National Bank approved the loan to Gibson based on the audited financial statements. Within 60 days after the sale of the common stock and the issuance of the loan, Gibson was involuntarily petitioned into bankruptcy. Because of the president’s embezzlement, Gibson became insolvent and defaulted on the loan from the bank. Its common stock became virtually worthless. Actions have been brought against Horton by
The purchasers of the common stock, who have asserted that Horton is liable for damages under Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934.
Citizens National Bank, based upon Horton’s negligence.
Trade creditors who extended credit to Gibson based upon Horton’s negligence.
Required:
a. Discuss whether you believe Horton will be found liable to the purchasers of common stock.
b. Indicate whether you believe Citizens National Bank will be successful in its claim against Horton.
c. Indicate whether you believe the trade creditors will be successful in their claim against Horton.
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
Taylor Bean & Whitaker Mortgage Corp. (Taylor Bean) was a Florida mortgage lender. Once one of the nation’s largest privately held mortgage companies, the company collapsed in 2009 after a multibillion dollar mortgage fraud unraveled.
The downfall of Taylor Bean also triggered the collapse of Colonial Bank in one of the largest bank failures in U.S. history. The SEC charged Lee Farkas, the former chairman of Taylor Bean, and several other officers of the company with conspiring to sell more than $1.5 billion worth of fabricated or impaired mortgage securities to Colonial Bank. The fraudulent scheme occurred from March 2002 until August 2009, when Taylor Bean filed for bankruptcy. The SEC charged Theresa Kelly, a former operations supervisor at Colonial Bank’s mortgage warehouse lending division, with being an active participant in the fraud scheme.
The bankruptcy trustee for Taylor Bean sued PricewaterhouseCoopers (PwC), which had served as Colonial Bank’s auditor, for $5.5 billion in damages, claiming that PwC was negligent in not detecting the fraud. Although PwC was Colonial Bank’s auditor, Colonial Bank and Taylor Bean had a close relationship. Most lawsuits related to the 2008 global financial crisis ended in settlements, and Taylor Bean’s auditor, Deloitte LLP, settled in 2013 for an undisclosed amount. The 2016 civil trial involving PwC was supposed to last six weeks. However, after three weeks, PwC settled with the bankruptcy trustee in a confidential settlement for an undisclosed amount.
Required
a. Most of the auditor litigation related to the 2008 financial crisis resulted in settlements. Why do you think most audit firms settled rather than going to trial?
b. The case involving PwC and Taylor Bean was one of the few cases that actually went to trial. Why do you think PwC initially decided to go to trial? Why do you think the firm settled halfway through the trial?
c. The trustee that sued PwC alleged that they were negligent in failing to uncover the fraud. To what extent should auditors be held responsible for failing to detect fraud? Does it matter that PwC was Colonial Bank’s auditor, and not the auditor for Taylor Bean?
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
You are auditing payroll for the Morehead Technologies company for the year ended October 31, 2019. Included next are amounts from the client’s trial balance, along with comparative audited information for the prior year.
You have obtained the following information to help you perform preliminary analytical procedures for the payroll account balances.
1. There has been a significant increase in the demand for Morehead’s products. The increase in sales was due to both an increase in the average selling price of 4 percent and an increase in units sold that resulted from the increased demand and an increased marketing effort.
2. Even though sales volume increased, there was no addition of executives, factory supervisors, or office personnel.
3. All employees including executives, but excluding commission salespeople, received a 3 percent salary increase starting November 1, 2018. Commission salespeople receive their increased compensation through the increase in sales.
4. The increased number of factory hourly employees was accomplished by recalling employees that had been laid off. They receive the same wage rate as existing employees. Morehead does not permit overtime.
5. Commission salespeople receive a 5 percent commission on all sales on which a commission is given. Approximately 75 percent of sales earn sales commission. The other 25 percent are “call-ins,” for which no commission is given. Commissions are paid in the month following the month they are earned.
Required:
a. Use the final balances for the prior year included above and the information in items 1 through 5 to develop an expected value for each account, except sales.
b. Calculate the difference between your expectation and the client’s recorded amount as a percentage using the formula (expected value – recorded amount)/ expected value.
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
Gale Gordon, CPA, has found ratio and trend analysis relatively useless as a tool in conducting audits. For several engagements, he computed the industry ratios for his clients and compared them with industry averages. For most engagements, the client’s business was significantly different from the industry data, and the client automatically explained away any discrepancies by attributing them to the unique nature of its operations. In cases in which the client had more than one branch in different industries, Gordon found the ratio analysis to be no help at all. How can Gordon improve the quality of his analytical procedures?
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
As the in-charge senior auditor on the audit engagement for JA Tire Manufacturing for the year ended December 31, 2019, you are responsible for performing risk assessment procedures related to the sales cycle. JA Tire has four sales divisions within the U.S. and sells primarily to large tire companies with regional warehouses that subsequently distribute to local retailers. Based on some of the risk assessment procedures already performed, you identified risks related to the fact that salespersons receive a commission on sales to distributors and the commission is calculated on a monthly basis. Your manager has asked you to perform analytical procedures as a part of audit planning to review sales information by sales division and by month to identify potential risk areas that might warrant further audit procedures related to sales.
Required:
1. Visit the textbook website to download the file “JATireSales.xls” provided to your audit firm by the company. This file contains sales transaction information for the year ended December 31, 2019. If you have not already done so, read the JA Tire Manufacturing system description provided on the first tab of the Excel file before attempting this assignment to familiarize yourself with the sales process and the relevant worksheets and terminology. Using the “Invoices” and “Sales Order” tabs in the Excel spreadsheet, perform the procedures in requirements 2 through 4 using either Excel, Tableau, or audit software such as ACL or IDEA.
2. Summarize sales by month and sales division using a pivot table in Excel (put divisions in columns, months in rows) or using a graph or chart in Tableau. If you are using Excel to summarize, you will first need to add a column to the Excel worksheet and extract the “month” portion of the shipping date in order to summarize by month. If you are using Excel, use the “graph” feature to graph the pivot table data. Identify any divisions or months that you believe should be examined further, and document your rationale.
3. For any divisions identified in step 2 for follow-up, summarize sales by customer and month using a pivot table in Excel or graph or chart in Tableau. You can use a “filter” in Excel or Tableau to limit the analysis to one or more divisions. Identify any months that you want to examine further, and document your rationale.
4. Summarize your findings in a brief memo to the manager and include the charts or graphs generated in steps 2 and 3 above as support for your findings. Discuss your recommendations for performing further audit procedures.
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
We are a professional website for customized writing. If you searched a question and stumbled into our website, you are in the right place to receive assistance with your coursework.
Do you handle any type of coursework?
Yes. We have displayed prior orders to demonstrate our experience. We can answer this question for you as we have previously. Please fill out our Order Form so that we may ensure its flawlessness. Correctly completing the order form will help our staff with reference, requirements, and future communication.
Is it hard to Place an Order?
Click on the “Order Now” tab at the top menu or “GET A FREE QUOTE” icon at the bottom and a new page will appear with an order form to be filled
Fill in the initial requirements in the small order form located on the home page and press “continue” button to proceed to the main order form or press “order” button in the header menu. Starting from there let our system intuitively guide you through all steps of ordering process. Submit detailed paper instructions, upload necessary files if needed and provide your contact information – you are almost done!
Proceed with the payment- click on “PROCEED TO CHECKOUT” at the bottom of the page. From there, the payment sections will show, follow the guided payment process and your order will be available for our writing team to work on it. All your payments are processed securely through PayPal. This enables us to guarantee a 100% security of your funds and process payments swiftly.
Delivery- Once finished, your final paper will be available for download through your personal dashboard. You will also receive an email notification with a copy of your paper attached to it.
