Sarbanes-Oxley has influenced the liabilities and responsibilities of Board of Directors, Corporate Executives, Auditors, Audit Committees, and Analysts (Advantages and Disadvantages, 2012). The strength of the act is companies have better internal control environment. This will lead to more accurate information being available to investors who are more confident in making investing decisions. All participants in financial reporting have increased responsibilities and consequences for not living
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specific controls used by the entity, in particular, whether they are manual or automated * Whether the auditor expects to obtain audit evidence to determine if the entity’s controls are effective in preventing or detecting material misstatements. 2. Additional information needed to complete an assessment: * The nature of further audit procedures * The timing of further audit procedures * The extent of further audit procedures * The nature of tests of controls
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receivables systems of Seeley Co. Audit documentation is available from the previous year’s audit, including internal control questionnaires and audit programmes for the despatch and sales system. The audit approach last year did not involve the use of computerassisted audit techniques (CAATs); the same approach will be taken this year. As far as you are aware, Seeley’s system of internal control has not changed in the last year. Client background – sales system Seeley Co is a wholesaler of electrical
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Worksheet for You Decide Name _JANICE VALDEZ Course Code _AC555ON_Grade ___/ Date 4/15/_2012_ Questions: Q1: Discuss how the SEC has influence (if any) over the audit of Smackey Dog Foods, Inc. Solution: The Securities and Exchange Commission (SEC), an agency of the federal government, assists in providing investors with reliable information upon which to make investment decisions. The Securities Act of 1933 requires most companies planning to issue new securities to the public
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audits of the 19th century. Answer: True Difficulty: Medium 2. The American Institute of Certified Public Accountants issues CPA certificates and permits CPAs to practice. Answer: False Difficulty: Medium 3. A company is either audited by the GAO or internal auditors, but not both. Answer: False Difficulty: Easy 4. The SEC does not pass on the merits of the securities that are registered with the agency. Answer: True Difficulty: Medium 5. The American Institute of Certified Public Accountants has the
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Generally Accepted Accounting Standards Auditing is an important part of any business. The auditor has many standards in which he or she must follow in order to comply with Generally Accepted Accounting Standards (GAAS) and the Public Company Accounting Oversight Board (PCAOB). Many factors play a part in the audit process. Every company has their own specific way, but public companies have to follow generally accepted accounting principles (GAAP) as outlined in the Sarbanes-Oxley Act of 2002.
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engagements that require procedures to be applied to financial reporting processes and controls, but do not necessarily require an audit. Then there are findings and recommendations that are used when implementing a system. The next type of audit is the SAS 70 audit. According to "NBD Accountants Consultants" (2008), “It is an auditing standard put forth by the AICPA that is utilized by auditors for examining internal controls in service organizations. Service organizations are the host of companies that
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communication 7 marks • Task 2 — Determine materiality and perform preliminary Analysis 9 • Task 3 — Assess inherent risk. 6 • Task 4 — Gain an understanding of the client's internal control environment and assess control risk. 4 24 marks 2 BC 2 – Assignment #2 • Task 5 — Design and perform tests of controls and dual-purpose tests. 10 marks 3 1 BC 2-Assignment #3 • Task 6 — Perform audit of cash and investments. 6 marks • Task 7 — Perform audit of accounts receivable. 10 »
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“America’s most innovated company.” Just six months later, in December, Enron filed for bankruptcy. The failure shocked the public and angered investors. How could this have happened? Did no one see this coming? Where were the accountants? Where were the controls? Enron’s public troubles began on October 16th of 2001 when management released a third quarter earnings report with a “mysterious $1.2 billion dollar reduction.” The following month the company restated earnings for the previous five years and
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Smackey Dog Foods, Inc Q1: Discuss how the SEC has influence (if any) over the audit of Smackey Dog Foods, Inc. Solution: The SEC assists in providing investors with reliable information upon which to make investment decision. The Securities Act of 1933 requires most companies planning to issue new securities to the public to submit a registration statement to the SEC for approval. The Securities Exchange Act of 1934 provides additional protection by requiring public companies and others
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