Mr. Obaid being the board member of Sony company, Muscat, is responsible for safeguarding the shareholders' investment and the company's assets. He and his team members, conduct a review of the effectiveness of internal controls and should report that they have done so. How often Mr. Obaid and his team are required to conduct the review of internal control system of their company: At the most in 2 years Once in life time of the business At least once in a year Once in 5 years CAL

Mr. Obaid being the board member of Sony company, Muscat, is responsible for safeguarding the shareholders' investment and the company's assets. He and his team members, conduct a review of the effectiveness of internal controls and should report that they have done so. How often Mr. Obaid and his team are required to conduct the review of internal control system of their company: At the most in 2 years Once in life time of the business At least once in a year Once in 5 years CAL

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Select the appropriate provisions of the Sarbanes-Oxley Act (SOX) for each of the following descriptions. Descriptions Major Provisions of the Sarbanes-Oxley Act a. Executives must personally certify the company's financial statements. b. Audit firm cannot provide a variety of other services to its client, such as investment advising. c. PCAOB establishes standards related to the preparation of audited financial reports. d. Lead audit partners are required to change every five years. e. Management must document the effectiveness of procedures that could affect financial reporting.
Which of the following statements is true of the Sarbanes−Oxley Act? A. All private and foreign companies must issue an internal control report evaluated by an outside auditor. B. Accounting firms are allowed to provide both auditing services and a full range of consulting services to their public company clients. C. Those who commit securities fraud must be sentenced to 10 years in prison. D. The Public Company Accounting Oversight Board oversees the work of auditors of public companies.
ETHICS (Rule-Making Issues) When the FASB issues new pronouncements, the implementation date is usually12 months from date of issuance, with early implementation encouraged. Karen Weller, controller, discusses with her financialvice president the need for early implementation of a rule that would result in a fairer presentation of the company’s financialcondition and earnings. When the financial vice president determines that early implementation of the rule will adversely affectthe reported net income for the year, he discourages Weller from implementing the rule until it is required. InstructionsAnswer the following questions.(a) What, if any, is the ethical issue involved in this case?(b) Is the financial vice president acting improperly or immorally?(c) What does Weller have to gain by advocacy of early implementation?(d) Which stakeholders might be affected by the decision against early implementation?
Erica Gray, CPA, is a sole practitioner. She has been practicing as an auditor for 10 years. Recently a long-standing audit client asked Gray to design and implement an integrated computer-based accounting information system. The fees associated with this additional engagement with the client are very attractive. However, Gray wonders if she can remain objective on subsequent audits in her evaluation of the client’s accounting system and its records if she was responsible for its design and implementation. Gray knows that professional auditing standards require her to remain independent in fact and appearance from her auditing clients. Required 1. What do you believe auditing standards are mainly concerned with when they require independence in fact? In appearance? 2. Why is it important that auditors remain independent of their clients? 3. Do you think Gray can accept this engagement and remain independent? Justify your response.
What are key audit matters? How do these affect the format of the audit report? maximum 200 words)b) Stewart Jones is reviewing the results of the subsequent events audit procedures. Stewart iswriting a report for his audit partner based on these results and will be attending a meetingtomorrow with the partner and representatives of the company to discuss them. The issue will bewhether the financial report should be amended, or additional notes included for thesesubsequent events.Many of the items are not material and Stewart will recommend that no action be taken withrespect to these. However, there are several items that Stewart believes are material and shouldbe discussed at the meeting. These are as follows.(a) The board is planning to issue shares in a private placement on 15 August. (b) The share issue is to fund the purchase of a 60 per cent stake in another company. Thenegotiations are in the final stages and although the contract is not yet signed it will be signedby 15…
Given the information below, Marco has a complete set of policies, procedures, and manuals that management requires employees to use. Management is aggressive about updating the manuals and training new employees to ensure they understand the policies and procedures that affect their duties. Management also requires employees to attend brief review seminars on the policies and procedures that affect their positions once a year. These policies include a code of conduct and employees are required to sign a statement agreeing to it when they are hired. What is the: a) potential control strength and (b) potential mistatement detected or corrected.
ABC Plc is a well-established public limited company listed on the NSE. It is currently undergoing its statutory annual audit from BDO, a reputable firm of accountants that been ABC's auditors and business advisors for more than 10 years. Over this period the managing partner of BDO has become a very good friend of the chief executive officer (CEO) of ABC Plc and their families regularly holiday together. The chairman of ABC Plc is expecting the audit to be signed off, but the audit partner managing the audit has suspicions around the adequacy of a series of provisions and whether contingent liabilities noted in the accounts would not more accurately be accounted for as provisions. She also disagrees with the capitalization of research expenditure and other intangible assets on the statement of financial position, rather than treating them as expenses in the statement of profit or loss. She has questioned the financial controller, who is a professionally qualified accountant, about…
identifying the strengths and weaknesses in relation to member and make a recommendation as to whether member should remain on the committee or be replaced. The constitution and membership of a Sapphire’s audit committee is as follows: Member A – Chair of the Committee who, before retirement two years ago was the Finance Director of the company
Your Audit team is preparing to audit a new client in the electronic retail industry. The client imports items from manufacturers in several Asian countries and retails in a chain of shops located throughout the country. You and your team members have access to the client's following information. · Prior period financial reports · Anticipated results for the current year · Industry Averages Required: Explain how you would use the information to understand your new client.
Grant Thornton was appointed as the new auditing firm for a publicly listed IT Company. The auditing firm's Engagement Partner, an IT expert, has just replaced the previous partner only this year. The previous partner left the firm to become the Finance Director of a competitor IT Company. Which of the following ethical principles will be least breached by the previous partner in the given situation? a. Confidentiality b. Objectivity c. Integrity d. Professional Competence