Public Accounting Profession

In their review of the public accounting profession, Lou Harris and Associates warn that an audit report too often is viewed as a “certificate of health” for a company: The report states: The most serious consequences stemming from such a misunderstanding are that the independent auditor can quickly be portrayed as the force that represents all good in financial accounting and the guarantor of anything positive anyone wants to feel about a given company. 1. Why is public accounting often viewed as a guarantor of results or even as a provider of assurance that one’s investment is of high quality? 2. To what extent is it reasonable to view the auditor as a guarantor? Explain. 3. How d... click for more

Auditing Questions

Please access the Securities and Exchange Commission website through www.sec.gov and select any public traded company. The objective of your assignment is to design audit programs for cash and inventory. As part of the assignment you must include the following information: 1. The name of the company and a brief description of the business operations of the company 2. The most recent balance sheet presented by the company. Please indicate which form you are obtaining the information from, for example 10-K or 10-Q. 3. Five specific audit steps for cash and fives specific steps for inventory. 4. Why do you believe that these steps will allow you, as an auditor, to determine that ... click for more

Audit and common fraud

If some frauds are deemed common, should auditors be held liable if they do not find a common fraud? Why or why not?

Identify examples of incremental commercialization within the public accounting profession

In the Scott Fane opinion, Justice O’Connor alluded to “incremental commercialization” within professions. Identify examples of incremental commercialization within the public accounting profession in recent years. How, if at all, has an increasing emphasis on the commercial aspects of public accounting affected the profession?

Audit Questions

Should publicly traded companies be required to publish the management letters that come from the auditors? Why or why not? Is a qualified audit opinion always a bad thing? Why or why not?