3 Auditing Questions

1. Which is better, statistical sampling or non-statistical sampling? Why? 2. Should Generally Accepted Auditing Standards prescribe specific risk levels that auditors must use? Why or why not? 3. Which assertion is most important for fair presentation of financial statements?

Audit: Select a publicly traded company for research to write an auditing program for their accounts receivable or inventory.

Access any company that you would like to research via the Internet and look up the company’s latest financial statements. Please choose a different company than you have access thus far. Select either Accounts Receivable or Inventory balances. Indicate the amount of the balance for the latest year end and the previous year end. Situation: 1. This company is a first year client. 2. The partner of your firm has indicated that he would like to know how you would audit accounts receivable or inventory. 3. Prepare a short memo on you audit approach. That is, write at least fives steps that you would use to audit this balance. Specifically indicate the type of sampling method th... click for more

Auditing MC

To determine whether sales transactions have been recorded in the proper accounting period the auditor performs cutoff tests. Which of the following best describes the overall approach used when performing cutoff tests? A) Ascertain that management has included in the representation letter a statement that transactions have been accounted for in the proper accounting period. B) Analyze transactions occurring within a few days before and after year end. C) Confirm yearend transactions with regular customers. D) Examine cash receipts in the subsequent period. Which of the following controls most likely would be effective in offsetting the tendency of sales personnel to maximi... click for more

Corporate Governance and the Audit Committee: the problem consists of six multiple choice questions concerning duties and responsibilities of the audit committee under Sarbanes-Oxley.

1. All of the following are parts of corporate governance except: a. Oversight of management by the board of directors b. Established processes to provide accountability back to stockholders c. Whistle-blowing processes d. Independent review of financial statements by the SEC 2. Which of the following would NOT be a correct statement about a partial cause of corporate governance failures? a. Boards of directors approved stock option plans that did not align management and shareholder objectives b. Audit committees met infrequently, only for an hour at a time c. The AICPA became a trade association concerned with enhancing the wealth of its members d. Accounting principles became... click for more

Auditing: importance of the assertions

Which auditing assertion is most important for the fair presentation of financial statements?