Example of Short Assignment (25 course points)
(To be written at the beginning of class towards the end of the semester)
Review your responses to the questions on any of the first three quizzes. Select three incorrect responses (use at least 2 different quizzes) and prepare an explanation of why your initial response was incorrect. In particular your discussion should include the following: identify the authoritative support that guides the correct response that you had initially failed to consider; explain the logical error made in your initial response and/or the inappropriate interpretation of the rule/authoritative guidance made in your initial response.
Auditing Alchemy Inc. Team Project
Due Date: Beginning of class period as noted on your syllabus
This project is a simulation of a “walkthrough” procedure that independent auditors perform during an audit of the client’s internal controls over financial reporting. You will adopt the role of an independent audit team responsible for the audit the production process for your client, Alchemy Inc. You will be provided with background materials and view interviews of Alchemy personnel performed by a member of the external audit team. You may take notes and schedule a meeting to replay some of the material (1 meeting per team). You have approximately 6 weeks after the in-class simulation to submit the final team document.
1. Using the background materials and management matrix provided by your client and your observations during the simulation complete the attached control matrix for Alchemy Inc., which will be included in the 2007 audit workpapers. Identify missing controls, control weaknesses, items listed as controls but are really procedures etc. Some examples are provided in the attached matrix.
2. Identify where is there the potential for misstatement due to fraud at Alchemy. Identify the area where the fraud can occur and the type of fraud. Describe the nature of...