Auditing Accounting

Analyze each situation and provide your assessment of the potential resolution of each scenario, Including potential liability for the auditor or audit firm involved.

1. The audit, firm Weaver and Jones, LLP, received a subpoena for its documentation related to the audit of west brook corporation's financial statements. The firm has refuses to respond, alleging that the documentation is considered privileged communication between the firm and its client.

2. Spencer Cullen, CPA, is a defendant in a lawsuit alleging that Cullen should be held legally liable for gross negligence for a fraud involving the valuation of securities included in the financial statements of one of his clients. Cullen was uncertain how to establish a correct valuation for the securities and decided to rely on the price estimation supplied by management.

3. Joanie Brogan is a partner in an audit firm that operates as a limited liability partnership (LLP). The firm has been sued for an alleged audit failure related to an audit engagement handled by a different partner in the firm. While Joanie had no involvement in the engagement, she is concerned that the plaintiff may successful sue her seeking restitution from her personal assets.