Chapter 24 - Completion + Professional Judgment

Or n the degree to which ones judgment is affected by

Info icon This preview shows pages 15–20. Sign up to view the full content.

View Full Document Right Arrow Icon
by the client. Or n The degree to which one's judgment is affected by the client. n Independence: n In appearance – assurance n In fact – audit quality
Image of page 15

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
+ What Affects Independence? n Individual n Financial interests – code n Familial interests – code n Managerial interests – code n Long relationships – rotation (SOX) n Future relationships – revolving door (SOX) n Audit Firm/Office n Size n Reputation n Expertise n Conflicting Services - SOX
Image of page 16
+ What Keeps Auditors Independent? n Ethics n Skepticism n Professional Code of Conduct n Litigation Risk n Accountability/Review Process n Decision Aids n Training
Image of page 17

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
+ Ethics n Ethics - A set of morals/values/principles upon which one evaluates rightness/wrongness of one's behavior. n Includes: honesty, integrity, fairness, respect, loyalty, justice, etc. n Problems? n gray areas, conflicting ethics n the ability to rationalize
Image of page 18
+ Skepticism An attitude that includes a questioning mind and a critical assessment of evidence. "An auditor should not be satisfied with less than persuasive evidence because of a belief that management is honest" - SAS 99 n May include: A. Objectivity in evidence evaluation B. Discount ALL evidence C. Suspicion "Evaluate information (evidence) and keep a questioning mind in the context of (1) source credibility (knowledge, independence), (2) consistency with other information (evidence), and (3) general reasonableness” Note: Keep the feelings out of it!
Image of page 19

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
+ For Thursday, 3/21 n Read Case 6 on Scholar n Focus on Biases/Heuristics n Review Chapter 10 (p. 294-302) + COSO Chapters
Image of page 20
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern