Chapter 3 and complete number 15 and 2

Advanced accounting
Chapter 3 and complete number 15 and 21

Auditing
Chapter 5 Research and Discussion Case 5-57


5-57) Datasave,
Inc.



The purposes of
obtaining the representation letter are to have management acknowledge their
primary responsibility for the financial statements, and to get in writing the
important oral representations that have been obtained from management during
the course of the audit.  AICPA AU 580 (PCAOB 333) requires that
the auditors obtain written representations from management on every audit
engagement.  Failure to do so is a
"scope limitation," which precludes the auditors from issuing an
unqualified opinion.  AICPA AU 580 also indicates that the
representation letter should be signed by members of management that are
responsible for and knowledgeable about the matters covered by the
representations and that, normally, they should be signed by the chief
executive officer and the chief financial officer.  AICPA
AU 580
 further states that the auditors should consider the effects of
management's refusal to furnish written representations on their ability to
rely on other of their representations.

AICPA AU 700 (PCAOB 508) provides that when the client
imposes restrictions that significantly limit the scope of the audit, the
auditors generally should issue a disclaimer of opinion.


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