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If You Need Love, Get a Poppy

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Submitted By wang98
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1. (1) SAS 99 states the professional skepticism as an attitude that includes a questioning mind and critical assessment of audit evidence. The auditor should conduct the entire engagement with an attitude of professional skepticism, consider audit evidences seriously, and finally, the auditor should continuously question whether information and evidence obtained suggest that material misstatement caused by fraud has occurred. (SAS 99)
(2) Will found out that one cash payments wasn’t deposited into that day’s bank account and kept digging even the amount is only $320, which is within the range of materiality. Also he had a questioning mind of the explanation Jess provided so that he noticed the difference of the ink color on envelop and receipt book, which was supposed be written at the same time. Then he looked closely at the date printed on the $100 bill, which was surprisingly one year later than the receipt date. Moreover, Will reported all the evidence he gathered to the partner and discuss it with him, which also indicates his professional skepticism.
(3) Will could have accepted Jess’s explanation because of the following reasons. Firstly, the $320 is very small amount compared to $5000 the materiality amount. Secondly, Will has been engaged in the audit for over 3 years, which he wouldn’t have doubted that one cash payment missing indicated a theft of cash. Thirdly, Jess is his good friend for years and he might have unconscious bias to believe what she said because of the familiarity with her.
2. (1) The second standard of the General Standards of the US GASS require independence as “The auditor must maintain independence (in fact and appearance) in mental attitude in all matters related to the audit.”
(2) Independence in appearance is the result of others' interpretations of this independence, which does not have a specific standard to evaluate. The

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