1. When clients depart from GAAP, auditors determine what type of reports they will issue. Give an example of a departure from GAAP and how the auditors would determine whether to issue a qualified or adverse opinion.
2. After the audit report release date, auditors determine that an important auditing procedure was omitted. What is the initial course of action that should be upon the discovery of an omitted audit procedure?
3. List the three basic inventory auditing procedures and, for each, describe how the use of CAATs and the computerized perpetual inventory database might be helpful to the auditor in performing such auditing procedures.
4. Under what circumstances might an audit team have a duty to disclose managements frauds to parties other than the companys management and its board of directors?
5. Incorporating elements of unpredictability in the selection of audit procedures to be performed by auditors is important. Explain why.