Identify and describe Reed’s responsibilities to detect Smith’s errors and fraud. Describe Reed’s responsibilities to detect Smith’s material noncompliance with laws.

Discussion post_Audit accounting

Study Cases

1. Questions requiring analysis – read question below and answer in your own words
Reed, CPA, accepted an engagement to audit the financial statements of Smith Company.
Reed’s discussions with Smith’s new management and the predecessor auditor indicated the possibility that Smith’s financial statements may be misstated due to the possible occurrence of errors, fraud, and illegal acts.

a. Identify and describe Reed’s responsibilities to detect Smith’s errors and fraud. Do not identify specific audit procedures.
b. Describe Reed’s responsibilities to detect Smith’s material noncompliance with laws. Do not identify specific audit procedures.
c. Identify and describe Reed’s responsibilities to report Smith’s noncompliance with laws

2. Questions requiring analysis – read question below and answer in your own words.

Tracy Smith, CPA, is in charge of the audit of Olympic Fashions, Inc. Seven young members of the public accounting firm’s professional staff are working with Smith on this engagement, and several of the young auditors are avid skiers. Olympic Fashions owns two condominiums in Aspen, Colorado, that it uses primarily to entertain clients. The controller of Olympic Fashions has told Smith that she and any of her audit staff are welcome to use the condominiums at no charge any time that they are not already in use. How should Smith respond to this offer? Explain.

Assignments:
1. Provide the answers to 2 questions above with a minimum of 100 words per 2. Provide the meaningful response to 3 students’ posts below with a minimum of 100 words per response.