Assignment 1: Auditors and Regulatory Oversight
Due Week 4 and worth 240 points
The Securities and Exchange Commission (SEC) regulates public companies. The
SEC has found that some of these companies have violated GAAP by using creative
accounting practices to mislead investors and creditors regarding the health of
their company.
Use the Internet or Strayer Library to research a recent accounting scandal
within the last five (5) years where the SEC accused public companies of
accounting irregularities.
Write a three to four (3-4) page paper in which you:
1.
Analyze the audit report that
the CPA firm issued. Ascertain the legal liability to third parties who relied
on financial statements under both common and federal securities laws. Justify
your response.
2.
Speculate on which statement of
generally acceptable auditing standards (GAAS) that the company violated in
performing the audit.
3.
Compare the responsibility of
both management and the auditor for financial reporting, and give your opinion
as to which party should have the greater burden. Defend your position.
4.
Analyze the sanctions available
under SOX, and recommend the key action(s) that the PCAOB should take in order
to hold management or the audit firm accountable for the accounting
irregularities. Provide a rationale for your response.
5.
Use at least two (2) quality
academic resources in this assignment.Note: Wikipedia and other
Websites do not qualify as academic resources.
Your assignment must follow
these formatting requirements:
·
Be typed, double spaced, using
Times New Roman font (size 12), with one-inch margins on all sides; citations
and references must follow APA or school-specific format. Check with your
professor for any additional instructions.
·
Include a cover page containing
the title of the assignment, the student’s name, the professor’s name, the
course title, and the date. The cover page and the reference page are not
included in the required assignment page length.
The specific course learning
outcomes associated with this assignment are:
·
Analyze the required generally
accepted auditing standards, professional ethics, and legal liability of the
auditor.
·
Assess how the Sarbanes-Oxley
Act has affected auditing.
·
Evaluate an audit report.
·
Evaluate objectives for
conducting audits, and compare management’s and auditors’ responsibilities.
·
Use technology and information
resources to research issues in auditing.
·
Write clearly and concisely
about auditing using proper writing mechanics.
