Answer to Question #177015 in Accounting for balveer

Question

B. Ware and Company performs all of its own accounting up to the trial balance stage. The CU Now and Then Inc., a firm of chartered accountants from the big city, prepares the adjusting entries and the financial statements. You are an auditor with CU Now and Then Inc., and have just completed the financial statements for B. Ware. You have just driven 800 kilometers to deliver these statements for an important business meeting that day and to begin some other audit work. When you open your files, you find that your working papers have been tampered with. The balance sheet, the worksheet, and the list of adjusting entries for B. Ware are missing. Only the income statement is present. The important meeting is only two hours away.

Answer 1

Most likely, the preparation of a deliberately false audit report entails liability in the form of revocation of the individual auditor or audit organization's license to conduct audit activities, and for the person who signed such an opinion, also revocation of the auditor's qualification certificate and bringing him to criminal responsibility in accordance with the law. Therefore, the auditor should not pre-submit such an audit report, but prepare a new audit report, the meeting should be canceled.