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A government auditor is conducting a financial statement audit of a public-sector entity in accordance with the International Standards of Supreme Audit Institutions (ISSAI). Which of the following is TRUE regarding the auditor's consideration of fraud during this engagement?
Suggested Answer: A
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32 comments · newest first
LA
Lauran
10 months ago
Not sure about A, isn't fraud enough to focus on?
LO
Louvenia
10 months ago
D makes sense, public audits have different objectives than private ones.
BA
Bambi
11 months ago
Wait, C can't be right, ISA 240 applies to all audits, right?
CY
Cyndy
11 months ago
I disagree with B, they can't just walk away like that.
TH
Theron
11 months ago
A is definitely true, auditors need to watch for abuse too.
JA
Janae
11 months ago
I feel like the objectives for public-sector audits are broader, not narrower, compared to private-sector ones, which makes me lean towards D being incorrect.
CH
Cherilyn
12 months ago
I practiced a similar question about ISA 240, and I think it does apply to public-sector audits, so C seems wrong.
PE
Pearline
12 months ago
I'm not entirely sure, but I think the auditor can only withdraw under specific circumstances, not automatically if fraud is found.
KR
Kristel
12 months ago
I remember discussing how auditors need to be aware of both fraud and abuse, so I think A might be correct.
MA
Maryann
1 year ago
Ah, this is a good one. The ISSAI standards are important, but I also need to remember that ISA 240 on fraud still applies. I'll make sure to consider both sets of requirements.
FL
Flo
1 year ago
The key here is understanding the differences between public-sector and private-sector audits. I believe the objectives are typically narrower in the public sector, so I'll focus on that angle in my response.
LA
Lauran
1 year ago
Okay, I know the ISSAI standards apply to public-sector audits, but I'm a bit fuzzy on how they differ from private-sector audits in terms of fraud considerations. I'll need to re-read the question closely.
NO
Nobuko
1 year ago
Hmm, this question seems straightforward. I'll need to carefully review the ISSAI standards and ISA 240 to determine the auditor's responsibilities regarding fraud in a public-sector audit.
AL
Alishia
1 year ago
Hmm, I'd have to go with A. Gotta keep an eye out for both fraud and abuse - can't let the government bureaucrats get away with anything!
LA
Lai
1 year ago
C is definitely wrong. The ISA standards absolutely apply to public-sector audits as well. These auditors aren't operating in a vacuum, you know.
IZ
Izetta
1 year ago
A: And they have to remain alert for any potential indicators of fraud throughout the engagement.
HO
Howard
1 year ago
B: That's right, they have to assess the risk of fraud and plan their audit accordingly.
YO
Yoko
1 year ago
A: The auditor must consider the risk of fraud in the financial statement audit.
HA
Hailey
1 year ago
B is a bit too extreme. The auditor can't just withdraw from the engagement if fraud is found - that would be irresponsible. They need to follow the proper procedures and reporting requirements.
RO
Rocco
1 year ago
D seems like the right answer to me. The objectives of a public-sector audit are likely narrower than a private-sector audit, as the focus is on compliance and accountability rather than just the financial statements.
DE
Desmond
1 year ago
C: It's important for the auditor to consider fraud risks in any type of audit, regardless of the sector.
SH
Shawnee
1 year ago
A: That's true, the objectives are definitely different compared to a private-sector audit.
AL
Alona
1 year ago
B: Yes, in a public-sector audit, the focus is more on compliance and accountability.
BR
Britt
1 year ago
A: I think you're right, option D does seem to be the most accurate.
FR
Frederic
1 year ago
I believe the objectives of the audit may be narrower compared to a private-sector audit, so the auditor should focus on specific areas related to the public-sector entity.
CA
Catarina
2 years ago
I think the correct answer is A. The auditor should be alert to both fraud and abuse during a public-sector audit. Fraud and abuse are both critical issues in government entities.
SE
Selma
1 year ago
Fraud and abuse can have serious consequences in government organizations, so the auditor must be thorough in their examination.
SA
Sarah
1 year ago
The auditor must maintain professional skepticism and be aware of the possibility of fraud.
AN
Angelyn
1 year ago
It's important for the auditor to consider the risk of fraud in a public-sector entity.
EN
Enola
1 year ago
Yes, you are correct. The auditor should be vigilant for both fraud and abuse.
FL
Flo
2 years ago
I agree with you, Aliza. It's important to be vigilant for both fraud and abuse during the audit.
AL
Aliza
2 years ago
I think the auditor should also consider potential abuse, not just fraud.