A: Research an accounting firm or auditors who failed to collect sufficient appropriate evidence. B: Evaluating...

A: Research an accounting firm or auditors who failed to collect sufficient appropriate evidence.

B: Evaluating management integrity is critical in assessing business risk. Please comment.

Expert Solution

Answer :

A - PricewaterhouseCoopers house in a well knows "Satyam Scam" failed to get the appropriate audit evidence. The auditor has relied upon the company which has shown them millions of dollar fake Fixed deposits and such deposit was actually not available in the physical form and the company reported that all Fixed deposit receipts are burn in the fire and FIR has been logged.

As per the Economic times "Price Waterhouse, the firm that audited the accounts of Satyam Computers, may have been misled into believing forged documents that sought to verify the existence of 175-odd fixed deposit receipts, valued at over Rs 3,319 crore (Rs 33.19 billion), and all the company's current account deposits. The details of the FDRs, which Price Waterhouse had physically verified, show that most of these instruments were due for redemption between October 2008 and February 2009. The Satyam accounts were audited for the period ended September 30, 2008."

The auditor of the PWC was barred for not performing the work with laid down procedures and the auditor can sense the misstatement by just enquired more about the data but failed to do that. For this PWC India was banned by the Security Exchange Board of India for two years.

The auditor is just like watchdog if they failed to get the evidence required, the whole auditing system gets collapsed.

Note: Please upload the B part as separate, as it is an Independent question Positive feedback will be highly appreciated. If you need any further help or clarification related to this question please do comment in the comment section. Thanks

ekkarill92 answered 2 years ago

22. ISA 500 Audit evidence requires auditors to obtain sufficient appropriate audit evidence to be able...

22. ISA 500 Audit evidence requires auditors to obtain sufficient appropriate audit evidence to be able to draw reasonable conclusions on which to base their audit opinion. Discuss the different sources of evidence available to auditors and assess their relative appropriateness

Auditors must obtain sufficient appropriate audit evidence to issue an audit opinion on the financial statements....

Auditors must obtain sufficient appropriate audit evidence to issue an audit opinion on the financial statements. In order to gain that evidence, auditors may use a combination of tests of controls and substantive procedures. Required: . Discuss a test of control and a substantive procedure. Give at least one example of each that may be used when auditing the completeness of corporate payroll system.

SSA 500 Evidence requires audior to obtain sufficient and appropriate audit evidence to be able to...

SSA 500 Evidence requires audior to obtain sufficient and appropriate audit evidence to be able to draw reasonable conclusions on which to base the audit opinion. Discuss the audit procedures that can be performed to collect evidence and evaluate the reliability of these procedures in ensuring that appropriate audit evidence has been obtained. (500 words minimum)

HKSA 500 “Audit Evidence” requires the auditor to obtain sufficient appropriate audit evidence to be able...

HKSA 500 “Audit Evidence” requires the auditor to obtain sufficient appropriate audit evidence to be able to draw reasonable conclusions on which to base the audit opinion. HKSA500 also identifies different types of audit procedures for obtaining audit evidence as well as offers guidance on how to assess the reliability of audit evidence. Required: For the four audit procedures which are Observation, Re-calculation, Inspection, Analytical procedures, describe an audit test using each of the procedure above to obtain evidence as...

What is meant by due professional care? What is sufficient appropriate audit evidence?

Do a research on HIH Insurance collapse and analyse how auditors had failed to fulfil their...

Do a research on HIH Insurance collapse and analyse how auditors had failed to fulfil their responsibility professionally and cover the following points in your report. 1. Executive summary 2. Introduction of the company 3. Auditors of the company 4. Collapse due to the audit procedures 5. Auditors professional and ethical behaviour 6. Recommendation 7. Conclusion And provide some references for your work.

The Auditing Standards Board established guidelines to assist auditors in evaluating the reliability of audit evidence....

The Auditing Standards Board established guidelines to assist auditors in evaluating the reliability of audit evidence. Discuss the criteria for the more reliable types of evidence and include an example for each.

1. The auditor could not obtain sufficient appropriate evidence for one material account. 2. The financial...

1. The auditor could not obtain sufficient appropriate evidence for one material account. 2. The financial statements as a whole are not presented fairly in accordance with the applicable financial reporting framework. 3. The client does not permit inquiry of outside legal counsel. The effects of this inability to obtain sufficient appropriate evidence are pervasive. 4. Management imposed certain limited restrictions on the scope of the audit. 5. The financial statements were presented fairly, in all material respects. 6. The...

Gathering sufficient appropriate evidence for the internal audit engagement requires extensive interaction and communication with auditee...

Gathering sufficient appropriate evidence for the internal audit engagement requires extensive interaction and communication with auditee personnel throughout the engagement. ( ) Agree ( ) Disagree, give reason:

Worthington Department Stores Auditing standards require the auditor to obtain sufficient appropriate audit evidence (AS 1105.04:...

Worthington Department Stores Auditing standards require the auditor to obtain sufficient appropriate audit evidence (AS 1105.04: Audit Evidence). The audit firm of Hepple & Ramsey was investigated for the audit of Worthington. Worthington is a large discount catalog department store chain. The company recently expanded from 6 to 43 stores by borrowing from several large financial institutions and from a public offering of common stock. A recent investigation has disclosed that Worthington materially overstated net income. This was accomplished by...

Question