A. Management of the audit team

Management of a team of auditors involves knowledge of professional standards and leadership of team members. Stress and unexpected developments are not uncommon in the audit process. Team leaders should be prepared to make reactions and decisions that they may not have experienced before.

If you are the audit team leader (manager) and you encounter the following issues during your audit (treat them as separate, unrelated items), describe the steps you think are appropriate.

1. Your client's business manufactures and sells electric bicycles similar to the ones you rent on campuses and community centers - they also sell products directly to consumers. Some of your friends have recently commented on the number of fires and other battery problems with a particular product your customer manufactures. What do you do with this information?

2. Your company's audit software system tracks every login and logout of each team member assigned to an audit. If no activity is noted for more than 30 minutes, the system automatically logs out the team member. You are looking at the audit team's activity on a large client last weekend and notice that team member John (who has been with the company for 2 years) has logged in for 18 hours straight. What do you do with this information?

3. You have 5 senior staff members (who have typically been with the company for 2 to 5 years) responsible for auditing a life sciences client in San Diego. One of your audit managers is concerned that two of these senior people simply don't get along and sound very frustrated. What do you do with this information? 4. the last week of the audit - crunch time - 6 days away from work, one of your two senior auditors calls to say she has to take her 6-year-old child to the hospital - The child has something that seems serious. What kind of work do you do?

B. Certified Public Accounting Firm Difficulty The PCAOB website has a section titled "Resolved Disciplinary Orders". Findings involving the accounting firm of Hall & Co. and the individual Anthony Price, CPA . A. Describe the circumstances and audit issues that led the PCAOB to take disciplinary action. B. How do you feel about the firm's new client acceptance standards for business performed by clients? C. How do you view Price's understanding of generally accepted auditing standards? Identify one specific area where auditing standards were violated. D. Two lessons you have learned from reading this press release.

A. Management of the audit team

Management of a team of auditors involves knowledge of professional standards and leadership of team members. Stress and unexpected developments are not uncommon in the audit process. Team leaders should be prepared to make reactions and decisions that they may not have experienced before.

If you are the audit team leader (manager) and you encounter the following issues during your audit (treat them as separate, unrelated items), describe the steps you think are appropriate.

1. Your client's business manufactures and sells electric bicycles similar to the ones you rent on campuses and community centers - they also sell products directly to consumers. Some of your friends have recently commented on the number of fires and other battery problems with a particular product your customer manufactures. What do you do with this information?

2. Your company's audit software system tracks every login and logout of each team member assigned to an audit. If no activity is noted for more than 30 minutes, the system automatically logs out the team member. You are looking at the audit team's activity on a large client last weekend and notice that team member John (who has been with the company for 2 years) has logged in for 18 hours straight. What do you do with this information?

3. You have 5 senior staff members (who have typically been with the company for 2 to 5 years) responsible for auditing a life sciences client in San Diego. One of your audit managers is concerned that two of these senior people simply don't get along and sound very frustrated. What do you do with this information? 4. the last week of the audit - crunch time - 6 days away from work, one of your two senior auditors calls to say she has to take her 6-year-old child to the hospital - The child has something that seems serious. What kind of work do you do?

B. Certified Public Accounting Firm Difficulty The PCAOB website has a section titled "Resolved Disciplinary Orders". Findings involving the accounting firm of Hall & Co. and the individual Anthony Price, CPA . A. Describe the circumstances and audit issues that led the PCAOB to take disciplinary action. B. How do you feel about the firm's new client acceptance standards for business performed by clients? C. How do you view Price's understanding of generally accepted auditing standards? Identify one specific area where auditing standards were violated. D. Two lessons you have learned from reading this press release.