Discuss the comparison and contrast the accumulation of audit evidence and the evaluation of the adequacy of the disclosures in the financial statements. Also, provide two examples in which adequate disclosure could depends hevaily on the accumulation of evidence and two others in which audit evidence does not normally significantly affect the adequacy of the disclosure.

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Definition Definition Costs that a business is responsible for paying, should a particular event potentially occur in the future. Also called a potential liability, a contingent liability is generally recorded only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly. The Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Principles (IFRS) make it mandatory for the companies to record any contingent liability taking the principles of full disclosure, materiality, and prudence into consideration.

Chapter 24, Problem 13RQ

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Discuss the comparison and contrast the accumulation of audit evidence and the evaluation of the adequacy of the disclosures in the financial statements. Also, provide two examples in which adequate disclosure could depends hevaily on the accumulation of evidence and two others in which audit evidence does not normally significantly affect the adequacy of the disclosure.

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Compare and contrast the accumulation ofaudit evidence and the evaluation of the adequacy of the disclosures in the financialstatements. Give two examples in which adequate disclosure could depend heavily onthe accumulation of evidence and two others in which audit evidence does not normallysignificantly affect the adequacy of the disclosure

Audit standards distinguish auditors’ responsibility for planning procedures for detecting noncompliance with laws and regulations havinga direct effect on financial statements versus planning procedures for detecting noncompliance with laws and regulations that do not have a direct effect on financial statements.Required:a. What are the requirements for auditors to plan procedures to detect direct-effect compliance versus indirect-effect compliance?b. For each of the following instances of noncompliance, explain why they are either directeffect (D) or indirect-effect (I) noncompliance:1. A manufacturer inflates expenses on its corporate tax return.2. A retailer pays men more than women for performing the same job. 3. A coal mining company fails to place proper ventilation in its mines.4. A military contractor inflates the overhead applied to a combat vehicle.5. An insurance company fails to maintain required reserves for losses.6. An exporter pays a bribe to a foreign government…

Can the auditor obtain more audit evidence to compensate for the lack of perceived appropriateness (quality) of the evidence which is available?

Answer 2

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Definition Definition Costs that a business is responsible for paying, should a particular event potentially occur in the future. Also called a potential liability, a contingent liability is generally recorded only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly. The Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Principles (IFRS) make it mandatory for the companies to record any contingent liability taking the principles of full disclosure, materiality, and prudence into consideration.

Chapter 24, Problem 13RQ

To determine

Discuss the comparison and contrast the accumulation of audit evidence and the evaluation of the adequacy of the disclosures in the financial statements. Also, provide two examples in which adequate disclosure could depends hevaily on the accumulation of evidence and two others in which audit evidence does not normally significantly affect the adequacy of the disclosure.

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Answer 3

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Definition Definition Costs that a business is responsible for paying, should a particular event potentially occur in the future. Also called a potential liability, a contingent liability is generally recorded only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly. The Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Principles (IFRS) make it mandatory for the companies to record any contingent liability taking the principles of full disclosure, materiality, and prudence into consideration.

Chapter 24, Problem 13RQ

To determine

Discuss the comparison and contrast the accumulation of audit evidence and the evaluation of the adequacy of the disclosures in the financial statements. Also, provide two examples in which adequate disclosure could depends hevaily on the accumulation of evidence and two others in which audit evidence does not normally significantly affect the adequacy of the disclosure.

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Answer 4

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Definition Definition Costs that a business is responsible for paying, should a particular event potentially occur in the future. Also called a potential liability, a contingent liability is generally recorded only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly. The Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Principles (IFRS) make it mandatory for the companies to record any contingent liability taking the principles of full disclosure, materiality, and prudence into consideration.

Chapter 24, Problem 13RQ

To determine