COULD SOMEONE PLEASE TRANSLATE THIS INTO BAHASA???

Do you believe the Bill Grant was justified in refusing to provide the requested work papers to the grand jury? Explain.

The CPAs refusal to provide the requested audit workpapers to the federal and grand jury was reasonable as an effort to maintain client confidentiality. Moreover, professional standards allow for auditors to disclose confidential client information concerning legal actions (Ehrlich & Williams, 2011). The subpoena presented in this case was a general subpoena commonly recognized as an obligation; Additionally, a firm can take further actions to minimize its risk when complying with the subpoena.

First and foremost, the CPA firm should consult with its attorney and liability insurer before contacting the client or responding, and it is critical that the firm understands the limitations and ramifications of sharing confidential information.

Secondly, the CPA firm should consult with its client before responding to the subpoena. The client will commonly request certain limitations to the scope of the document request; it is reasonable for the firm to review the limitations with its in-house counsel.

Lastly, the firm should obtain written consent from the client and any other parties included in the subpoena.

What responsibility, if any, does a public accounting firm have to its partners and employees when they are subpoenaed to testify regarding a client?

Corporations face unprecedented pressure to make disclosures to their independent auditors in the current regulatory environment, and they risk waiving well-established protections as they respond to requests for otherwise privileged information (Reach, 2012). When a partner or employee at an accounting firm is subpoenaed regarding a work related issue as a current or former employee, the accounting firm has a reasonable responsibility to provide corporate counsel in support of the client. Additionally, the firm should recommend that the client may want to retain separate legal representation. In some circumstances, the firm may be willing to reimburse the employee. It is the responsibility of the accounting firm to inform the client of the subpoena and the firm's procedures, policies and responsibilities for responding to subpoenas concerning current and former clients.

What is the purpose of attorneys letters obtained during the course of an audit? If attorneys are aware that these letters can be routinely subpoenaed, how does this fact likely affect the quality of the audit evidence yielded by these letters?

An attorneys letter is sent by the auditing firm to a client's counsel. It informs the auditor of any current or pending litigation involving the client. It also serves as verification for information about litigation involving management. Attorney letters almost always constitute a subpoena; fortunately, there are provisions designed to protect attorney client privilege. According to AU 9337, the attorney may respond with a very generalized statement to protect the client. If an attorney believes that the specific request from the auditors would violate attorney-client-privilege, that attorney may send a response to auditors indicating that it believes that such information is covered by attorney-client privilege (Louwers et al., 2012). Although this situation may create a limitation on documentation, it is the responsibility of the attorney to have considered the possibility and potential impact of a scope limitation on the audit process and opinion.

Do you believe the documentation included in tax accrual and audit work papers is likely affected by the auditors knowledge that those work papers can be obtained by the IRS? Explain.

According to Bez-Daz and Alam, descriptive statistics show that firms are increasingly using more income-decreasing tax accruals than income-increasing book accruals contributing to the growing divergence between tax and book earnings (Bez-Daz & Alam, 2013). Auditors are usually aware that audit work papers regarding tax matters can be obtained by the IRS. All public companies are required to file annual reports with regulating agencies such as the SEC and the IRS. The auditor has a professional responsibility to act in the public interest according to professional and moral standards. Principal moral standards such as integrity and honesty should compel auditors to provide the highest level of accuracy in their documentation. Furthermore, it is unlikely that the auditor would alter its workpapers to avoid IRS scrutiny as such an action would expose the auditor to potential litigation.

As professionals, we must strive to uphold personal and spiritual integrity throughout everything that we do. In Proverbs 28:6 Gods Word reminds us, "better is a poor man who walks in his integrity than a rich man who is crooked in his ways." Having a clear conscience and strong moral foundation will allow us as auditors to provide superior service backed by Christian principals.