Auditing: A Risk Based-Approach to Conducting a Quality Audit
Auditing: A Risk Based-Approach to Conducting a Quality Audit
10th Edition
ISBN: 9781305080577
Author: Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher: South-Western College Pub
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Chapter 2, Problem 48RSCQ

a.

To determine

Introduction: Audit committee is a sub-committee of board of directors which is responsible for providing an oversight to the financial reporting process. Audit committee acts as an intermediary between external auditors of the company and the management to resolve areas of conflict amongst them.

To explain: The changes in audit committee membership and duties mandated by the Sarbanes Oxley Act. Also, explained the increased responsibilities of audit committee due to Sarbanes Oxley Act.

b.

To determine

Introduction: Audit committee is a sub-committee of board of directors which is responsible for providing an oversight to the financial reporting process. Audit committee acts as an intermediary between external auditors of the company and the management to resolve areas of conflict amongst them.

To examine: the implications of ownership over relationship with external auditor on auditor and audit committee.

c.

To determine

Introduction: Audit committee is a sub-committee of board of directors which is responsible for providing an oversight to the financial reporting process. Audit committee acts as an intermediary between external auditors of the company and the management to resolve areas of conflict amongst them.

To explain: The responsibility of audit committee in case of a complex transaction not involving any reporting issue. Also, explain the skills or expertise required in such type of transaction.

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Students have asked these similar questions
The Sarbanes-Oxley Act (SOX) mandates which of the following? a. Increased regulations related to auditor–client relations. b. Increased regulations related to internal control. c. Increased regulations related to corporate executive accountability. d. All of the above.
Section 301 of the Sarbanes-Oaxley requires that public companies have an audit committee. Independent auditors are increasingly involved with audit committees.  Required: a. Describe what an audit committee is. b. Identify the reasons why audit committees have been formed and are currently in operation. c. Describe the functions of an audit committee.
Governmental auditors’ independence and objectivity are enhanced when they report theresults of an audit assignment directly toa. Managers of the government agency under audit and in which the auditors are employed.b. The audit committee of directors of the agency under audit.c. Political action committees of which they are members.d. The congressional committee that ordered the audit.
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