ACCT 411 set #2

kyleparkinson184's version from 2015-04-29 03:46


Question Answer
4 causes of information riskVoluminious data, Remoteness of information, Biases and motivesof provider, complex exchange transactions
Voluminious dataTons of information, hard to find what information is useful or correct
Remoteness of informationHard to locate information without incurring great cost
Biases and motives of ProviderLack of independence from audit
Complex exchange transactionsHard to understand exchanges (Needs special knowledge)
How to information risk for buyerverify information, examine information from outside source, share information with another person
Pros and Cons of IRA agentAdvantage: Broad training and extensive knowledge, Hands on experince, limited to tax, no experince with auditing or financial statements
Pros and Cons of CPAExtensive training in audit/financial statements, opportunities within consulting. Not as indepth of a experince in tax, not likely to be exposed to operational auditing
Pros and Cons of Internal AuditorExtensive exposure to all segments of an entity, constant exposure to one industry. Little exposure to tax and limited to experince within one entity
Pros and Cons of GAO auditorIncreasing opportunity for operational audting and exposure to computer auditing. Little exposure to diversity in industry and lots of bureaucracy
6 Quality controlsLeadership Responsibilities, Ethical Requirements, Acceptance and continuation of clients and engagements, human resources, engagement performances, Monitoring
Leadership ResponsibilitiesPolicies and Procedures are followed by leadership (What leadership does)
Relevant Ethical RequirementsRemain independent and keep their integrity (Independence)
Acceptance and continuation of clients and engagementsfollow policy and procedure to determine if continuing service. Used to keep independence (Evaluate clients before accepting a job every time)
Human ResourcesMake sure staff is qualified (Making sure evaluations are done and employees are qualified)
Engagement PerformanceMake sure performance meets a professional standard (A way things are done. Asking senior accountants for advice)
MonitoringMake sure other qualities are being applied efficiently. (Someone internal watching staff)
Required part of auditCity and State of audit firm, Title representing its from an independent firm, A statement explaining managements responsibility for financial statements, Date Audit is finished, If refers to another Audit must disclose portion of financial statements audited by other firm
Change of Accounting PrincipleMaterial misstatement requiring an unqualified opinion with a explanatory paragraph
GAAP departure onlyMaterial. Qualified opinion
GAAP departure highly materialAdverse Opinion
IFRS audit reportUnqualified- modified wording
Restriction of scope that is highly materialDisclaimer
Use of another Audit firm and you do not take responsibility for their workUnqualified- Modified wording
Types of ReportsDisclaimer, Qualified, Unqualified standards, Unqualified Modified wording, Unqualified- Standard with explanatory paragraph, Adverse
Four CyclesSales, Payment/Acquisition, Capital Acquisition and repayment, Inventory and warehousing.
Main Reason to Perform an AuditForm an opinion on financial statements
Types of Accounting
Catagories of Management Assertion (3)Class of transaction, Account Balances, Presentation and disclosure,

Recent badges