Issuer VS NonissuerIssuer= PUBLIC Company Nonissuer= PRIVATE Company Management’s Responsibility Nonissuer PrivateMR. DIMM= managementis R= responsiblefor the prep and fair presentation of FS D = design I = implementationand M = maintenanceof internal controls Auditor’s Responsibility Nonissuer Private REPPORTS CRAME R= auditor’s responsibility E= to expressopinion on FS based on audit P = plans& performs audit to obtain reasonable assurance FS free from MM P = audit involves performingprocedures O= to obtainaudit evidence R = assessment of riskof MM of FS T= auditors considers internal control (testIC) relevant to entity’s S = prep and fair presentation of financial statements C= effectiveness of entity’s internal control R = reasonablenessof significant A = accountingestimates M= made by management E = evaluatingthe over presentation of FS Basis for Opinion Issuer Public RAPMEE x2 R= FS are the responsibilityof the company’s management R = auditor’s responsibilityis to express opinion on FS based on the audit A = auditoris a public acc firm registered w/ PCAOB A= audit was conducted in accordancew/ standards of PCAOB P = PCAOB standards require auditor to plan P= and performaudit to obtain reasonable assurance M = about whether the FS are free from MM M= performing procedures to assess risk of MMof FS EE= examining, on test basis, evidenceregarding amounts & disclosures in FS EE= evaluatingacc principles used and significant estimatesmade by mgt. CAM (Critical Audit Matter) Issuer PublicFor each CAM make sure you IDENTIFYit on a PADof paper. IPAD I = identificationof the CAM P= description of principalconsiderations that led auditor to determine CAM A = description of how the CAM was addressedin the audit D = reference to relevant FS accounts or disclosures Use of Emphasis-of-Matter Paragraphs (M7)Nonissuer PrivateGAASP When you hear a GAASP during the audit, remember thatan emphasis-of- matter is required. G = substantial doubt about entity’s ability to continue as a going concern A = describe a justified change in acc. principal that has material effect on FS A = subsequently discovered facts lead to change in auditopinion SP = FS prepared in accordance w/ an applicable special purposeframework Updating/Changing Prior Opinion (M8)Client updates work we update our opinion Remember, only DORCS, change their mind. D = dateof auditor’s previous report O = opiniontype previously issued R = reasonfor the prior opinion; “Because…” C = changesthat have occurred S = statementthat the “opinion…is difference” Auditor’s Responsibility for Subsequent Events (M10)PRIME P = reviewpostbalance sheet transactionsfor proper cutoff R = representationletter from mgt. on events in sub. period I = inquiryof client’s legal counsel concerning litigation, claims, assessments M = minutes from stockholders, directors and other committee meetings E = examinelatest available interim FS and compare to FS under audit
