This is “End-of-Chapter Exercises”, section 6.6 from the book Accounting in the Finance World (v. 1.0).
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Whittington and Company is a CPA firm that audits publicly traded companies. Which of the following is true concerning Whittington and Company?
Which of the following is not true about an audit report?
Which of the following is true about the Financial Accounting Standards Board (FASB)?
Which organization is a governmental entity?
Which of the following is true about the Securities and Exchange Commission (SEC)?
Match the following organizations to their descriptions.
The chapter mentions the Big Four public accounting firms: Deloitte, Ernst & Young, KPMG, and PricewaterhouseCoopers. We will visit the Web site for one of these—PricewaterhouseCoopers. Go to http://www.pwc.com and answer the following questions:
Select the Audit and Assurance function. How does the firm define assurance?
PricewaterhouseCoopers is currently the auditor of Dell. Go to http://www.dell.com and click on “investor relations” at the bottom of the page. Choose “financials” in the upper left corner. Click on “10-K filings” in the upper right corner. Choose the most recent 10-K. Find the Auditor’s Report and read through it.
In the United States, audits must be conducted by Certified Public Accountants (CPAs). Each state has different requirements that individuals must meet to become licensed as a CPA. This exercise will give you a chance to discover the rules in your state. Begin by going to the Web site for the National Association of State Boards of Accountancy (NASBA) at http://www.nasba.org.
Click on the box that says “State Board Listing.” A map of the United States will appear. Click on your state. The information for your state board of accountancy will appear in a box. Click on the Web site given. By navigating around the Web site for your state board of accountancy, you should be able to find out what the exam, education, and experience requirements are in your state. Write these down.