Audits

7 lousy reasons for putting documentation in your audit work papers.

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There is a lot of stuff accumulated during the audit that doesn’t belong in the workpapers. Toss it.

Charles Hall provides a list of reasons things are sometimes included in the audit file that don’t belong there: Seven Reasons for Unneeded Work Papers.

Of course the list starts with SALY. Look at the last item:

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7 lousy reasons for putting documentation in your audit work papers.Read More »

7 lousy reasons for putting documentation in your audit work papers. Read More »

Compliance with laws and regulations – new requirement for 12-31-12 audits

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Charles Hall has a good summary of the new requirement in the clarity standards on looking at your client’s compliance with laws and regs.

Check out The Clarity Project – Compliance with Laws and Regulations.

By the way, if you are in the field starting your 12-31-12 audits, you need to be implementing those new clarity rules.

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Lessons to learn *before* you get a call from a client saying they found an embezzlement fraud

Leave a Comment / Audits, Fraud /

Would this call ruin your day?

You answer the phone and your client says:

“George, we just found out our controller has stolen about $70,000 per year for the last three years. Since you guys have been doing our audit, I thought I’d call and discuss what we need to do.” The caller does not verbally say it, but he intimates, “where were you guys?” and “how are you going to resolve this?”

That’s the sobering start to Charles Hall’s post at CPA-Scribo – Fraud Stings Auditor.

He outlines three mistakes you may have made on your latest audits:

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Lessons to learn *before* you get a call from a client saying they found an embezzlement fraudRead More »

Lessons to learn *before* you get a call from a client saying they found an embezzlement fraud Read More »

Refresh your audit planning and fraud assessment

Leave a Comment / Audits, Fraud /

As we roll into audit season, would be wise to revisit your audit planning and risk assessment. Gary Zeune can help you do that in his superb article, Fraud: The 15 biggest risks for 2013.

He reminds us that we really, really need to understand our clients and their overall environment. We need to look at fraud from different angles all the time.

Try these ideas to refresh your thinking:

#1 – Are there things going on in DC or issues for which nothing is happening that could devastate your client’s industry? If so, you need to pay attention to the action or lethargy in play.

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Refresh your audit planning and fraud assessmentRead More »

Refresh your audit planning and fraud assessment Read More »

“Tragedy of Fraud” e-book now available at Amazon

Leave a Comment / Accounting, Audits, Books you might enjoy, Compilations & reviews, Fraud /

“Tragedy of Fraud – The Ripple Effects from Fraud and the Wages Earned” describes the tragic consequences from fraud.

There are ripple effects that spread out to harm innocent bystanders.  The perpetrator draws a wide range of well-deserved wages that will be paid in full.

The book looks at two fraud incidents to learn what happens after a fraud is discovered. One took place in a local megachurch and the other in the mayor’s office of a small city.

The book closes with a discussion of the fraud triangle. That’s the idea that three components need to be present for a fraud to take place – opportunity, motivation, and rationalization. There are steps an organization can take to reduce those factors.

You can find the book at Amazon here.

This book is a compilation of blogs posts that have been previously published at Nonprofit Update and Attestation Update. The posts have been edited slightly and reorganized for easier reading.

Major sections of the book: …

“Tragedy of Fraud” e-book now available at AmazonRead More »

“Tragedy of Fraud” e-book now available at Amazon Read More »

Explanation of differences between audits, reviews, and compilations

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On my other blog, Nonprofit Update, I have an explanation of the differences between the 3 levels of services we provide as CPAs.

There won’t be anything new in the post for CPAs. It might give some good information to your clients though.

If it is helpful to explain to your clients the different levels of service, you could refer them to that page, or you could link to the page. I don’t give permission to copy the post. You can refer your clients or potential clients to it, if doing so improves your client’s understanding.

The post in long in terms of the norms for the blogging world and short in term of giving a full explanation of the level of services. I hope it will be helpful for our clients.

Check out: Level of Services Provided by a CPA – The Differences Between Compilations, Reviews, and Audits

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‘Tragedy of Fraud’ in e-book format – soon to be released

Leave a Comment / Accounting, Audits, Books you might enjoy, Fraud, Other stuff /

(Cross posted from my other blog, Nonprofit Update.)

Tragedy of Fraud – The Ripple Effects from Fraud and the Wages Earned will be released soon in Kindle format. This is a compilation of blog posts about the damage caused by fraud. It will also discuss the fraud triangle.

The sections of the book are: …

‘Tragedy of Fraud’ in e-book format – soon to be releasedRead More »

‘Tragedy of Fraud’ in e-book format – soon to be released Read More »

Official report on New Mexico Finance Authority’s faked audit report – Part 3

Leave a Comment / Audits, Fraud, Pondering /

The Office of State Auditor (OSA) has issued several official reports on the fabricated June 30, 2011 financial statements from the New Mexico Finance Authority. You can find two of the reports here and here.

This is the third in a series of posts on the reports.  Previous posts are here and here.

Are lots of new procedures needed inside NMFA?

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Official report on New Mexico Finance Authority’s faked audit report – Part 3Read More »

Official report on New Mexico Finance Authority’s faked audit report – Part 3 Read More »

Official report on New Mexico Finance Authority’s faked audit report – Part 2

2 Comments / Audits, Fraud /

The Office of State Auditor (OSA) has issued several official reports on the fabricated June 30, 2011 financial statements from the New Mexico Finance Authority. You can find two of the reports here and here.

This is the second in a series of posts on the reports.  Previous post is here.

Report conclusion

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Official report on New Mexico Finance Authority’s faked audit report – Part 2Read More »

Official report on New Mexico Finance Authority’s faked audit report – Part 2 Read More »

My guest post at re: The Auditors is at the top of the list for her favorites of 2012

2 Comments / Accounting, Audits, Fraud /

Wow! My guest post on the Olympus fraud, How Do You Hide A Multibillion Dollar Loss? Accounting For The Olympus Fraud, (link below) is at the top of Francine McKenna’s list of favorite posts for 2012.

Her comment: …

My guest post at re: The Auditors is at the top of the list for her favorites of 2012Read More »

My guest post at re: The Auditors is at the top of the list for her favorites of 2012 Read More »

What date should you use for a CPA’s report?

Leave a Comment / Audits, Compilations & reviews /

For a fast summary of the rules for a compilation, review, audit, and agreed upon procedures, check out a superb post by Charles Hall, at his blog CPA-Scribo:  Dating CPA Reports

For each level of service, the post summarizes the rule and provides a citation to the professional literature.

The post also has a discussion of coordinating the representation letter with the final review and dating the report.

Check it out.

What date should you use for a CPA’s report? Read More »

New audit opinion for 2012 – example for NPO client of one-partner or multi-partner firm

2 Comments / Audits /

One of the biggest changes in the clarified audit standards is a new audit report.  It will apply for audit reports issued in 2013 for our 12-31-12 clients. 

This will be a biggie for 2013 work.

I previously provided a sample audit report for a commercial client of a one partner firm.  Here is a sample report for nonprofit organizations I plan to use in my practice.

The new opinion is discussed in AU-C Section 700, Forming an Opinion and Reporting on Financial Statements.

You can find all the new clarified standards on this page at the AICPA website.  You can click directly to section 700 here.

Here is the new report for an NPO, set up with options for a one partner or multi-partner firm.  Don’t forget the title, Independent Auditor’s Report. That is part of the report.

Independent Auditor’s Report

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New audit opinion for 2012 – example for NPO client of one-partner or multi-partner firm Read More »

New audit opinion for 2012 – example for commercial client of one-partner firm

2 Comments / Audits /

A brand new audit report is one of the biggest changes in the clarified audit standards.  It will apply for audit reports issued in 2013 for our audits of 12-31-12 financial statements.

This is a biggie.

The new opinion is discussed in AU-C Section 700, Forming an Opinion and Reporting on Financial Statements.

You can find all the new clarified standards on this page at the AICPA website. You can click directly to section 700 here.

Here is the new report, adjusting pronouns to a one partner firm. Don’t forget the title, Independent Auditor’s Report:

Independent Auditor’s Report

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New audit opinion for 2012 – example for commercial client of one-partner firmRead More »

New audit opinion for 2012 – example for commercial client of one-partner firm Read More »