Assume that an auditor finds a material misstatement regarding the financial statements while performing substantive tests of

Question:

Assume that an auditor finds a material misstatement regarding the while performing substantive tests of the account balance. More important, the auditor concludes that the misstatement involved the misapplication of an accounting principle to achieve a desired financial result and that the misstatement was intentional.
a. What actions should the auditor take upon detecting an intentional misstatement in the To whom must the misstatement be reported?
b. If the company agrees to correct the misstatement, is there a need to communicate the nature of the misstatement to important of the company? If yes, explain the avenues the auditor has available to report the misstatement.
c. What are the implications of detecting an intentional misstatement in terms of evaluating the control environment and the effectiveness of internal controls in general?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Stakeholders
A person, group or organization that has interest or concern in an organization. Stakeholders can affect or be affected by the organization's actions, objectives and policies. Some examples of key stakeholders are creditors, directors, employees,...

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Answer rating: 63% (19 reviews)

a When auditors detect an intentional misstatement they should do the following 1 reconsider the lev...View the full answer

Answered By

Tobias sifuna

I am an individual who possesses a unique set of skills and qualities that make me well-suited for content and academic writing. I have a strong writing ability, allowing me to communicate ideas and arguments in a clear, concise, and effective manner. My writing is backed by extensive research skills, enabling me to gather information from credible sources to support my arguments. I also have critical thinking skills, which allow me to analyze information, draw informed conclusions, and present my arguments in a logical and convincing manner. Additionally, I have an eye for detail and the ability to carefully proofread my work, ensuring that it is free of errors and that all sources are properly cited. Time management skills are another key strength that allow me to meet deadlines and prioritize tasks effectively. Communication skills, including the ability to collaborate with others, including editors, peer reviewers, and subject matter experts, are also important qualities that I have. I am also adaptable, capable of writing on a variety of topics and adjusting my writing style and tone to meet the needs of different audiences and projects. Lastly, I am driven by a passion for writing, which continually drives me to improve my skills and produce high-quality work.

5.00+ 1+ Reviews 10+ Question Solved

Related Book For book-img-for-question