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L19 Notes_Part_15 - agreement Compare terms of contract...

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Related Party Transactions How do we identify related parties? prior year's WP, predecessor auditor inquiry SEC filing inquire with mgmt stockholder listings minutes of the Board of Directors ARP Review of contract Discuss with tax and management personnel to determine the extent of management’s involvement in these transactions Scan for unusually large transactions at year end What procedures are necessary when you find a related party transaction? Confirm with related party their understanding of the terms of the
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Unformatted text preview: agreement Compare terms of contract with another comparable situation to determine reasonableness Make inquiries and discuss the possibility of fraudulent financial reporting with client counsel Assess the adequacy of related party disclosures Related Party Transactions Auditors are responsible for auditing the substance of the transaction. Are auditors responsible to determine whether the transactions was at arm’s length or whether it would have occurred had the parties not been related?...
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