Explain the significance of the audit risk factors you see

Reference no: EM131681801

Assignment

There are 3 parts to this assignment.Relevant professional standards for thisassignment are:

AICPA ASB Standards: AU-C Section 240 "Consideration of Fraud in a Financial Statement Audit," AU-C Section 300 "Planning an Audit," and AU-C Section 315 "Understanding the Entity and Its Environment and Assessing the Risks of Material Misstatement," and AU-CSection 330, "Performing Audit Procedures in Response to Assessed Risks and Evaluating the Audit Evidence Obtained." See AU-C Section315, Appendix C - Conditions and Events That May Indicate Risks of Material Misstatement.

PCAOB Standards: AS 1101, "Audit Risk," AS 2101, "Audit Planning," AS 2110, "Identifying and Assessing Risks of Material Misstatement," and AS 2301, "The Auditor's Responses to the Risks of Material Misstatement." AS 2110.15 provides examples of business risks that could give rise to material misstatements.

1. Case 1.3 Just for FEET, Inc.

a. Assume that you are on the Deloitte audit team for Just For FEET. As part of the planning process, you have been asked to write a memorandum identifying and explaining all of the audit risk factors present for the 1998 Just for Feet audit. These are things the auditor would take into consideration in a risk analysis. (For example, it is a publicly traded company which suggests extensive reliance on audited financial statements). In addition, discuss any accounts you believe may be high-risk accounts. For each audit risk factor and high-risk account you identify, explain the potential effect on the audit plan.

b. Do you believe the Deloitte auditors responded appropriately to the risk factors you identified? Explain.

2. Case 2.9 Powder River Petroleum International, Inc.

a. Identify and explain the significance of the audit risk factors you see based on the information providedin the case.

b. From the information provided, do you believe the auditors appropriately assessed and responded to these risk factors? Explain.

Reference no: EM131681801

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