Week 1 Discussion Questions
1)
Based on the definition of
auditing and the four generally accepted reporting standards (Table 2-3) as
well as the text discussion of these items, do you think users of financial
statements should expect those statements to be free of errors and fraud? Do auditors make this guarantee when they
provide the firm with a “clean opinion?” Answer in your own words and defend your
position.
2)
GAAS standards emphasize the
critical importance of auditor independence and objectivity, as does the
definition of auditing. Do you believe
that auditors can be sufficiently independent and objective when the auditee is
also a client and is paying the auditor’s fees?
Why or why not? Answer in your
own words and defend your position.
3)
The text discussion several
legal forms of organization – proprietorship, general partnership, general
corporation, professional corporation, limited liability company, and limited
liability partnership. Should states
limit the form of organization that CPA firms can use and why? If so, which forms should be prohibited and
why? Answer in your own words and defend
you choices.
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