Describe auditor liability under contract law, common law, and statutory law.

Question 1 (30 points)
Please discuss the significance of the following to the auditing profession and public companies:
Sarbanes-Oxley Act of 2002
Public Company Oversight Board (PCAOB)
Securities & Exchange Commission (SEC)
American Institute of Certified Public Accountants
Question 2 (30 points)
Please describe fraud and provide two specific examples. Please select one real life example of fraud and relate it to the fraud triangle. Please also discuss the auditor’s fraud-related responsibilities.
Question 3 (30 points)
Distinguish between material weaknesses, significant deficiencies, and control deficiencies in internal control over financial reporting. Please provide a specific example of each type and how they impact the auditor’s report on internal control over financial reporting.
Question 4 (30 points)
Describe auditor liability under contract law, common law, and statutory law. Please describe the different causes of legal action and the related defenses.
Question 5 (30 points)
Please describe the following discuss how and where they are used in the audit opinion formulation process:
Accounting cycles
Management assertions
Audit evidence and audit procedures
Documentation
Question 6 (25 points)
Please the importance of the evidence concepts of appropriateness and sufficiency and explain how those concepts are influenced by the risk of material misstatement. Please also discuss the factors affecting the sufficiency and appropriateness of audit evidence as well as quality audit documentation.
Question 7 (25 points)
What is the risk of material misstatement? Please discuss these risks and describe how they relate to audit risk and detection risk. Please describe the factors affecting control risk and inherent risk, including fraud risk factors.

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