Audit research assignment

22. You and your staff have completed an audit of a nonpublic company for the calendar year ended December 31, 20X1. The unmodified audit report date was March 11, 20X2. On March 26, 20X2, the client issued the financial statements. Your team subsequently became aware of Information regarding material nonexistent sales that were included in the 20X1 financial statements. The team concludes that, if known, this information would have affected the audit report. The audit team believes there are persons currently relying on, or likely to rely on, the financial statements. Is the auditor's responsibility with respect to the nonexistent sales different if the auditor has resigned or been discharged prior to undertaking or completing the investigation than if he were the continuing auditor? Some examples of correctly formatted AU responses are AU- C333.21

5. AICPA Professional Standards provide guidance on the language that should be used in the auditor's report. Select the most relevant AICPA template for the continuing auditor's "unmodified" report on consolidated comparative financial statements from the applicable Statement on Auditing Standards. Some examples of correctly formatted AU responses are AU- C333.21

6. As a new auditor, you are working on a small entity with limited complexities. You are aware that the professional standards provide guidance regarding the identification of fraud risks. In particular, the standards address the characteristics of the entity which may be used to evaluate the risk of material misstatement due to fraud. Identify the GAAS paragraph which describes considerations specific to smaller, less complex entities. 7. An auditor's report on financial statements prepared in accordance with a regulatory basis of accounting has been issued, but is not intended for general use. How should the auditor communicate that use of the audit report is restricted to the entity and parties of the regulatory agency? Provide the citation in the professional standards provides an illustration for the wording of this kind of restriction. Some examples of correctly formatted AU responses are AU- C333.21

8. Suppose that you have been asked to draft a memorandum to provide basic guidance for entry level staff members of your firm regarding professional services applicable to "prospective financial information." Locate and select the paragraph that describes the objectives of an examination of prospective financial information. Some examples of correctly formatted AU responses are AU- C333.21