Audit final exam - 1. (TCO A) There are ten generally...

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1. (TCO A) There are ten generally accepted auditing standards, divided into three categories. What are the standards of reporting? (Points: 10) 2. (TCO A) Distinguish between generally accepted auditing standards (GAAS) and generally accepted accounting principles (GAAP). What professional organization establishes GAAS? What professional organization establishes GAAP? (Points: 15) 3. (TCO B) Assume you are the partner in charge of the audit of Franklin Corporation's 2002 financial statements. The audit report has not yet been prepared. In each independent situation following, indicate the appropriate opinion you should issue and why you would issue that opinion. 1. You have substantial doubt about Franklin's ability to continue as a going concern. 2. Franklin Corporation changed its method of computing depreciation in 2002. You concur with the change, and the change is properly disclosed in the financial statement footnotes. 3. Ten days after the balance sheet date, one of Franklin's buildings was destroyed by a fire. Franklin refuses to disclose this information in a footnote to the financial statements, but you believe disclosure is required to conform with generally accepted accounting principles. The amount of the uninsured loss was material, but not highly material. (Points: 15) 4. (TCO C) State whether there is any violation of the AICPA Code of Professional Conduct, and the nature of the violation. Where there is a violation, evaluate the potential legal liability the accountant may face. Justify your position. 1.
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This note was uploaded on 04/01/2012 for the course AC 555 AC 555 taught by Professor Na during the Spring '10 term at Keller Graduate School of Management.

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Audit final exam - 1. (TCO A) There are ten generally...

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