[jeff]

Free Study Planner, Notes, Audio, Flashcards: https://www.another71.com/cpa-exam-study-plan/

Free CPA Exam Survival Guide: https://www.another71.com/cpa-exam-survival-guide/

Jeff Elliott, CPA (KS) | Another71 | NINJA CPA | NINJA CMA | NINJA CPE

[mariam almas]

guys, does confirmation need a pre approval from management ??

moreover, if other information is not constant with fin. st., what type of audit report should be issued??

AUD: 81 (Done)
REG: Currently studying
FAR: TBD
BEC: TBD

NH

[Mary 2496]

This would be my answer to your questions — (not saying I am right, though!)

confirmation (as in A/R confirmation) does not need pre-approval, as it is an auditing procedure and not an inquiry (such as legal inquiry).

If other information is not consistent (as in supp. information) with the financial statements, the audit report would likely include an “other matter” paragraph explaining the situation. It would still be an unqualified opinion as long as the financial statements are not misleading and are worthy of an unqualified opinion.

Again, I may be wrong, but that's what I would do.

[Qlad]

what is the purpose of remittance advice…I understand that it is sent by the customer to the supplier that their payment is done…what happens to it when it reaches the supplier? is it just put in a file so it may be referred to see if the payment is done?…why is the remittance advice made when the check reaches in mail…????.trying to understand this concept…I'm not an AUD person

FAR 72,71,81 🙂
AUD 64,71, 72, 75 🙂 I'm done !!!
REG 73, 74, 74, 84 🙂
BEC 76 🙂

[rzrbkfaith]

@Mariam – you do have to have management's authorization before sending out confirmations. Confirmations must be signed by management before they go to banks or to customers.

If other information is not consistent with the financial statements, materiality comes into play. Is it material? Is it material and pervasive? If its immaterial, you can still have an unmodified opinion. If its material but not pervasive, qualified opinion. Material and pervasive is adverse.

If management prevents you from obtaining sufficient audit evidence or you are unable to obtain sufficient evidence for any reason, then you will either issue a qualified or disclaimer opinion. You might even consider withdrawing depending on the situation.

@Qlad – a remittance advice ensures that your payment is properly applied to your account. In a perfect world, a company will separate the remittance advices from the checks when they are received. The accounts receivable department will match them up with the deposit and post the payments to the accounts.

AUD - 99
BEC - 97
REG - 91
FAR - 1/8/16

[mariam almas]

@Mary 2496 thnx

AUD: 81 (Done)
REG: Currently studying
FAR: TBD
BEC: TBD

NH

[LilEngineThatCan]

Ahhhh so much action! good morning!

@mariamalmas Answer was B! sorry for the late response

Here's a little giggle before we start to get to the grind

“Auditing — When it comes to necessary evils, auditing is right up there with flossing, getting your oil changed, and clipping your toenails. Sure, you know you have to do it, but there are a lot of things you'd rather be doing. Clients hate you, the PCAOB hates you, and you probably hate yourself. And then, when all is said and done, the best you can provide is reasonable assurance. “

Is it just me or was that so funny =P

[Qlad]

Good one @ lilengine…

FAR 72,71,81 🙂
AUD 64,71, 72, 75 🙂 I'm done !!!
REG 73, 74, 74, 84 🙂
BEC 76 🙂

[LilEngineThatCan]

The financial statements of KCP America, a U.S. entity, are prepared for inclusion in the consolidated financial statements of its non-U.S. parent. These financial statements are prepared in conformity with the accounting principles generally accepted in the parent's country and are for use only in that country. How may KCP America's auditor report on these financial statements?

A U.S.-style report (unmodified)

A U.S.-style report modified to report on the accounting principles of the parent's country

The report form of the parent's country

A. I only

B. II only

C. Both I and III

D. Both II and III

[LilEngineThatCan]

Correct Answer: D

If financial statements prepared in conformity with accounting principles generally accepted in another country are prepared for use only outside the United States, the auditor may report using either a U.S.-style report modified to report on accounting principles of another country or, if appropriate, the report form of the other country.

[Anonymous]

@ Qlad I'm not an auditor as well but I will try to answer your question based on what I know and as I look into the flowchart. 😀

Remittance advise is sent along with the check to show details of what's being paid so the recipient will know how to apply the payment. The proper internal control (recipient of check) is that the mail room opens the mail and separate the checks and remittance advice. He will then prepare list of checks received (aka remittance list) on 2 copies. 1 copy goes to the cashier along with the checks, the other 1 goes to controller to match against the validated deposit slip. The cashier will prepare the deposit slip for the checks received and compare it with the remittance list then deposit the checks to the bank. Then validated deposit will go to controller to reconcile with the 2nd copy of remittance list.

Now if you're wondering what about the remittance advices. The mail room will need to put them together and forward them to the AR department to post payments to AR subsidiary ledger.

[mariam almas]

@rzrbkfaith thank you soo much

AUD: 81 (Done)
REG: Currently studying
FAR: TBD
BEC: TBD

NH

[Qlad]

@CPAby2015…thanks a lot…one step at atime …hoping to get there…

FAR 72,71,81 🙂
AUD 64,71, 72, 75 🙂 I'm done !!!
REG 73, 74, 74, 84 🙂
BEC 76 🙂

[LilEngineThatCan]

Anyone want a mini quiz to keep them company?

[jeff]

Post by Another71.

Jeff Elliott, CPA (KS) | Another71 | NINJA CPA | NINJA CMA | NINJA CPE

[Tarheelgirl]

@ lilengine – sure! I'll try to do it at work.

Anyone here on the east coast? While, I am sleeping while yall are posting questions. I am almost caught up on the questions everyone posted last night, lol. They were all good ones. Thanks.

FAR - 46, 79 (7/8/14)
AUD - 56, 59, 2/23/15 3rd times a charm!
BEC - 69, 74 Really??
REG - April, I hope. Fingers crossed!

[Author]

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