1.1 enron case - Auditors shouldnt be getting more money...

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Kelly Legner 1. Enron 1. Accountants, Anderson Auditors, CFO, CEO, SEC 2. A. Tax consulting- cannot audit the statements and give advice on how to report the transaction throughout the year. B. Managing-cannot tell the manager how to manage a certain way to avoid certain things. C. Legal- cannot give legal advice and audit the agency. 3. Yes, you cannot give advice on consulting and help the client with the accounting aspect and than audit the client for the advice you just given. There is no separation of duties and you can catch a mistake and correct it. 4. According to AU 339.31, working papers are the property of the auditor. Working papers must be current, should have a date and who completed the work, should include specific testing, prior findings, audit program. 5. a. Scope of services- the company should not be able to do the books and audit. b. fees paid to the auditor- need to be on a proxy statement and 10K.
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Unformatted text preview: Auditors shouldnt be getting more money than what is in the contract for audit fees. c. members must be independent. Members shouldnt have relatives working for a company that they are auditing. d. whistle blower- a person should be able to turn their company in for illegal acts without being fired for it. e. communication- auditors should give reports on critical accounting policies. This should be done especially if it is critical so if can be looked at into detail and discussed with management. 6. Done later 7. I think companies should have their quarterly financial statements audited because by the time year-end comes the statements could be wrong and will have to be fixed. This can be helped by having them audited and most audits you have to audit the quarterly anyways to make sure they complies with the laws....
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This note was uploaded on 05/23/2011 for the course ACCT 842 taught by Professor Shekib during the Spring '11 term at Governors State University.

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