1. The list below indicates various engagements involving auditors. 1. An evaluation of areas of concern related to effectiveness of the company's financial reporting process that were found to have problems in prior financial statement audits. The reported findings may allow for correction of issues prior to the arrival of the company's external auditors. 2. A consultation in which the practitioner's function is to provide short-term counsel, based mostly on existing personal knowledge about a client-prepared business plan as well as suggesting a course of action related to the selection of a computer software for the client. 3. A report that provides a detailed analysis of hypothetical "what-if" company financial statements for a five-year period in the future. 4. A report that evaluates a company's economic performance and viability in the areas of social responsibility and environmental impact. 5. A report for a non-profit state university that receives federal financial assistance through grants, loans, and cooperative agreements in excess of $500,000 annually. 6. A report that represents expert testimony with regard to an investigation of a publicly traded company's economic losses related to unauthorized inventory purchasing agreements and procedures that existed as a result of inadequate financial reporting controls and lack of management oversight. 7. An evaluation of a periodic report regarding contributions and expenditures filed by a liberal political action committee, whose expenditures exceeded $50,000 for a calendar year. 8. A compilation of financial statements by an audit firm for their multinational publicly-traded client Oudatown's jet leasing company Cheadum. Cheadum is a private related-party firm that is owned by Oudatown's CFO. 9. An evaluation and report of a publicly traded company's effectiveness in administering the State of North Carolina's Water Quality Improvement Program. The program uses state funds for both water conservation educational awareness as well as various water cleaning and aquifer restoration projects. The Company's management has the responsibility for ensuring compliance with program objectives as well as collecting and analyzing output measurements of the program. 10. A report that retroactively analyzes the effect of a proposed transaction on the company's historical financial statements as if that transaction had already occurred. Required: For each engagement (1-10), identify the service type (A-D), audit type if applicable (I-V), accounting professional or auditor type (1-6), and the appropriate standard setting body (a-j). For the purposes of this assignment assume that most appropriately certified professionals are conducting the engagements and they are following the most specific and authoritative guidance available. Example answer for hypothetical engagement 11: A, II, 5, d g. IRS Service Type A. Audit B. Attestation C. Assurance D. Nonassurance Audit Type I. Financial II. Operational III. Compliance IV. Forensic V.N/A Accounting Professional or Auditor Type 1. CPA 2. External 3. Internal 4. IRS 5. Governmental 6, CFE Standard Setting Body a. PCAOB b. ASB h. AICPA c. IIA i. IIASB d. GAO j. ACFE e. ARSC k. MCSEC f. ASEC Legend: 1. The list below indicates various engagements involving auditors. 1. An evaluation of areas of concern related to effectiveness of the company's financial reporting process that were found to have problems in prior financial statement audits. The reported findings may allow for correction of issues prior to the arrival of the company's external auditors. 2. A consultation in which the practitioner's function is to provide short-term counsel, based mostly on existing personal knowledge about a client-prepared business plan as well as suggesting a course of action related to the selection of a computer software for the client. 3. A report that provides a detailed analysis of hypothetical "what-if" company financial statements for a five-year period in the future. 4. A report that evaluates a company's economic performance and viability in the areas of social responsibility and environmental impact. 5. A report for a non-profit state university that receives federal financial assistance through grants, loans, and cooperative agreements in excess of $500,000 annually. 6. A report that represents expert testimony with regard to an investigation of a publicly traded company's economic losses related to unauthorized inventory purchasing agreements and procedures that existed as a result of inadequate financial reporting controls and lack of management oversight. 7. An evaluation of a periodic report regarding contributions and expenditures filed by a liberal political action committee, whose expenditures exceeded $50,000 for a calendar year. 8. A compilation of financial statements by an audit firm for their multinational publicly-traded client Oudatown's jet leasing company Cheadum. Cheadum is a private related-party firm that is owned by Oudatown's CFO. 9. An evaluation and report of a publicly traded company's effectiveness in administering the State of North Carolina's Water Quality Improvement Program. The program uses state funds for both water conservation educational awareness as well as various water cleaning and aquifer restoration projects. The Company's management has the responsibility for ensuring compliance with program objectives as well as collecting and analyzing output measurements of the program. 10. A report that retroactively analyzes the effect of a proposed transaction on the company's historical financial statements as if that transaction had already occurred. Required: For each engagement (1-10), identify the service type (A-D), audit type if applicable (I-V), accounting professional or auditor type (1-6), and the appropriate standard setting body (a-j). For the purposes of this assignment assume that most appropriately certified professionals are conducting the engagements and they are following the most specific and authoritative guidance available. Example answer for hypothetical engagement 11: A, II, 5, d g. IRS Service Type A. Audit B. Attestation C. Assurance D. Nonassurance Audit Type I. Financial II. Operational III. Compliance IV. Forensic V.N/A Accounting Professional or Auditor Type 1. CPA 2. External 3. Internal 4. IRS 5. Governmental 6, CFE Standard Setting Body a. PCAOB b. ASB h. AICPA c. IIA i. IIASB d. GAO j. ACFE e. ARSC k. MCSEC f. ASEC Legend
