Principles of Auditing 17-30 Essay examples

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1. A company has not followed generally accepted accounting principles in the recording of its leases.
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2. A company has not followed generally accepted accounting principles in the recording of its leases. The amounts involved are immaterial.
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3. A company valued its inventory at current replacement cost. While the auditor believes that the inventory costs do approximate replacement costs, these costs do not approximate any GAAP inventory valuation method.
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4. A client changed its depreciation method for production equipment from the straight-line method to the units-of-production method based on hours of utilization. The auditor concurs with the change.
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5. A client changed …show more content…
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15. An auditor was hired after year-end and was unable to observe the counting of the year-end inventory. She is unable to apply other procedures to determine whether ending inventory and related information are properly stated.
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16. An auditor was hired after year-end and was unable to observe the counting of the year-end inventory. However, she was able to apply other procedures and determined that ending inventory and related information are properly stated.
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17. An auditor discovered that a client made illegal political payoffs to a candidate for president of the United States. The auditor was unable to determine that amounts associated with the payoffs because of the client's inadequate record-retention policies. The client has added a note to the financial statements to describe the illegal payments and has stated that the amounts of the payments are not determinable.
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18. An auditor discovered that a client made illegal political payoffs to a candidate for president of the United States. The auditor was unable to determine that amounts associated with the payoffs because of the client's inadequate record-retention policies, although there is no likelihood that the financial statements are pervasively misstated, they may be materially misstated. The client refuses to disclose the payoffs in a note to the financial statements.
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19. In auditing the long-term investments account of a new client, an auditor finds that a
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